What Seasoned Traders Wish They Knew as Beginners

Webull 06/15/2022

It’s no secret that trading stocks is a delicate matter not to be taken lightly. When it comes to investing, every little step is crucial, so it’s important that you take the time to do it right. With a little guidance, this process can be made easier for those who are new to trading. Take some advice day traders wish they had before starting out:

Start small

You may feel inclined to put a little into stocks, ETFs, options, and so on, but as a first-time trader, it may be best to start small and grow from there. Choose one stock (or whichever product you decide best suits your needs) to invest in as you’re starting off. This can help you get the hang of things and gain an understanding through immersion. Investing is not meant to be a get rich quick scheme; in order to find what you’re looking for, go slow as a beginner and work your way up from there. By doing so, you can mitigate your risks and pave the way for larger profits in the future. While nothing is guaranteed, you will likely find better long-term results by using this as your first strategy.

Consider risk over profit

While making a profit off your investments is usually a main goal for investors, you should consider risks more heavily than you consider the potential profits. Just because an investment has the potential to pay out, doesn’t mean that it will. Before making any investment, be certain that you can handle the loss if it does not play out in your favor. If you’re only thinking about how much money you might make on a trade and ignore the possibility of losing a portion, or even the entirety, of your investment, you put yourself in a position to potentially face a burden you did not prepare for. It’s crucial to consider every case scenario of a trade before placing it, especially the ones that might hit you the hardest.

Stick to a method

Find a strategy that works and stick with it. Everyone’s strategy will look a little different since everyone has different goals and reasons for investing. Choosing a method that works well for you and remaining consistent is a key part of finding success in your investments. Don’t just follow the same formula that someone you know uses, as while their method might work for them, it may not be suitable for you. Take the time to figure out what fits your needs and how you can comfortably trade. While it may take some time to figure out the best strategy, once you find it, stay consistent.

It’s okay not to immediately recover from a loss

Don’t dwell on your losses. You won’t bounce back right away, and that’s okay. Patience is a virtue. If you attempt to cover your losses immediately by doubling down or throwing more money at another stock, you risk losing more. By waiting it out, you can take a step back to understand what went wrong and implement a better plan.

Learn before you buy

Don’t jump right in. Take the time to learn everything you can before putting money into an account. Try trading without money first as well to test your skills; you can do this with Webull by opening a paper trading account. By taking the time to learn and practice, you can help mitigate your risk. When you choose to avoid this crucial step, your potential for loss is much greater, as you’ll end up trading with little knowledge and strategy. You want to start your investing journey as prepared as possible, no matter how long it takes. Be certain that you’re ready to trade before starting.


Disclosure: All investments involve risk, and not all risks are suitable for every investor. The value of securities may fluctuate and as a result, clients may lose more than their original investment. The past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit or protect against loss in a down market. There is always the potential of losing money when you invest in securities or other financial products. Investors should consider their investment objectives and risks carefully before investing.