WOW. It's my first week trading stocks EVER in my life. My second week in the Stock Challenge. I've had some pretty big lessons learned this week:
Commission fees can really stack up and need to be factored in to your sell price in order to at least break even. Learned that on my very first trade, which I thought was profitable... until commissions. That being said, buying in larger quantities can help offset the need for the stock to have to significantly increase to turn a profit.
I went against the grain and held a couple stocks overnight based on anticipation of big spikes the next day... against warnings from other challengers and teachers. These resulted in some big losses the next day. Listen when warned not to keep a stock overnight.
Don't set a buy for market open... until you're already AWAKE before market open. Had a great buy in for URRE set and could've turned a great profit on it in the first 2 hours of trades... except I overslept my alarm by 3 hours and wasn't able to put in a sell limit once I owned the stocks... and resulted in a loss on this stock.
Take what Tim and the other mentors for the Trading Challenge have to say about buying and selling with grains of salt. Their advice is not the end all be all. I acquired 2 different stocks when Tim and Mark did... and sold relatively around when they did based on both saying they needed to dump the stock and cut their losses. HOWEVER, both stocks ended up bouncing back over $2 from where I had purchased them. Could've turned some REALLY great profits if I'd held on to them just minutes longer.
Learn to trust my pre-determined sell limits on hot stocks. Today, I took several tokens of advice from chatroomers and mentors... bought in to 3 stocks, only to watch them all narrowly miss turning me a profit over the next hour. By the time I decided to cut my losses, just minutes later the stocks spiked to well over my sell limits and have continued to sit there ALL DAY.
PATTERN DAY TRADER is NOT a term you want associated with you on your account (unless you keep over $25k in there). Robinhood warned me, then banned me for 90 days, and now I have a warning from ETrade for the exact same thing... and now I'm stuck with CBIO in my portfolio, already at a loss, trying to figure out when I can ditch it and not get my ETrade account banned for 90 days. I wish this was something that was early flagged for newbies such as myself by this program. It was my understanding that day trading and making multiple trades in a day was what pennystocking was all about...
Failing is learning, right??? Luckily these lessons have only cost me about $220 this week. But it's all a good reminder that I still have NO IDEA what I'm doing. I'm only half way through the 1st disc on Pennystocking for the course... and have no idea how to read graphs and spot trends that I see others discussing in the chat room. Looks like I'll be taking next week off from trading and focusing on learning more from the course materials.
Don't trade yet and get educated. Start with Michael Goode webinars, they are hidden gems. Then watch Sykes and Grittani DVD's at least once. Follow the market. Do this for 3-4 months, then rewatch the DVD's. Don't get distracted by the chat room and trying to trade. You are not ready yet. Get a decent broker and get use to the trading platform by paper trading. Try to get 50% winners before putting real money in. Most of the time, timing the trade it is all the secret. After a year of the Chall
Challenge, this is my best advice.
By the way, most brokers will remove the ban on your account the first time you get banned for the PDT rule. Just call them and politely explain you didn't realize the rules and they will usually take it off of your account. Just don't do it twice! Good luck.
Hey, for avoiding lots of commissions: https://profit.ly/user/Skiwi/blog/for-profitable-people-who-lose-money-on-commissions
Join now or log in to leave a comment