Market Trading

5 tips to avoid trading losses

1 Read/Watch Trading fails

Me buying 1 of share GME at $260

Well the GME train seems to be slowing down, or is it? Many people have their opinions on GameStop and why it popped a stunning 736%. To recap why it was such a monumental stock soar, was because it wasn’t pushed to the moon to make a profit, but to teach a lesson to the head corrupt head funds of wall street. 

I believe there are two sides to this story and completely understand that there are pros and cons to this whole mission, but in summary, people are tired of the top %1 in this vast market, manipulating the news in order for their gain and not caring about what it does to the retail investor. 

The little guys teamed up on Reddit under the group wallstreetbets, and worked together to launch this money shorted stock ( GME) because wall street hedge funds have been shorting this stock for so long and have been really pushing it into the grave when the 7m WSB group pumped the stock up, it did a lot of damage to the hedge funds, and they definitely retaliated by using their power to quickly stop this pump. 

it was a great lesson for wall street, but beginner investors can be lulled into this play and get stuck at the top, thinking that it will keep going, but in reality, it won’t cause it already pumped, held, and now returning to the actual value of this stock which is right around $50.

2 Research your hat off

This is a word that is honestly overused and tiring to oneself, but in this case, and how things are headed into the market, it is crucial to really take time a research a stock for a good amount of time, if you are a well-rounded investor, you will most likely have solid sources and hopefully a sphere of solid friends whom may check your sources and express their ideas or opinions Aswell. Listening to opinions is great, but it’s wise to not believe everything they say.

3 Buy on Fear/Sell on Greed

One of the Greatest Investors!

This is such an important formula to remember, When the fear takes over in your mind, it is very easy to make rational moves, but actually they are inspired and motivated from emotional thinking.

If the Dow Jones sunk 2,000 points in one day, then most people would flip out and panic sell; on the other hand, if you spent a fourth of the time investing in researching why it dropped, and the eighty percent of your time, investing in the companies you love, then that would be a day well spent.

The market takes corrections, some are larger than others and at some point, it takes a really big drop, usually called a market crash.

With all of that said,

it will either push you 2 ways, one way is following the herd and selling out, also called losing profit, or being wise and just buying the dip, and waiting for it to recover.

I have been on both sides and can definitely say the winning side is patient and usually doesn’t do what the majority are doing.

4 Choose your Broker Wisely

Brokers can be your worst enemy or your best friend, they are the bridge that allows you to convert your strategic trading plans into action.

At NBT we recommend you compare your brokerages and a really great resource to use is Investopedia. My top favorite place to learn which broker is right is they are very useful and can help narrow down the pros/cons you are desiring.

Its no secret, how easy and luring a bad broker can be, for example, one brokerage that has held a reputation for being unreliable along with shaddy order processing is Robinhood. It’s not my place to spread dirt on another company; however, from my personal experience with this service, I will vouch to share my results and the truth, in the order to serve you, hard-working people!

How to avoid the wolves of wallstreet!

  • Research your Brokerage: Who are their partnerships? or their income sources trustable? What do they strive for?
  • Read Reviews: All of them Top to Bottom!
  • Customer Service: Do they have fast response time? Do they even have a number to call?
  • Hope that helps guys!

5 Stop your losses!

1 Their are tools to this game, the faster you learn and apply them, the better your odds are at winning in the world of stock trading. There are many factors that contribute to 90 percent of day traders losing, but here are some reasons, not being patient, FOMO, Laziness in researching, and emotional trading.

Investing in Robinhood was great, but once I became impatient in my gains, I discovered options trading and that was my downfall, at some point, I look forward to revisiting my mistakes and really learning that game, but in the meantime, I feel it necessary to spread the real facts and help in areas I have some experience in. We here at Nitrobluetrades and Nitrofinance believe ” Never Ever Give Up!”

Keep Trading, Remember to Use your Stop Limits, Stop Losses, and never do market sell. If you invest your time

Here are the basic order types ( from Investopedia )

  • A market order instructs the brokerage to complete the order at the next available price. Market orders have no specific price and are generally always executed unless there is no trading liquidity. Market orders are typically used if the trader wants in or out of a trade quickly and is not concerned about the price they get.
  • A limit buy order instructs the brokerage to buy a security at or below a specified price. Limit orders ensure that a buyer pays only a specific price to purchase a security. Limit orders can remain in effect until they are executed, expire, or are canceled.
  • A limit sell order instructs the broker to sell the asset at a price that is above the current price. For long positions, this order type is used to take profits when the price has moved higher after buying.
  • A sell stop order instructs the brokerage to sell if an asset reaches a specified price below the current price. A stop order can be a market order meaning it takes any price once triggered, or it can be a stop limit order where it can only execute within a certain price range (limit) after being triggered.
  • buy stop order instructs the broker to buy an asset when it reaches a specified price above the current price.
  • day order must be executed during the same trading day that the order is placed.
  • Good till canceled (GTC) orders remain in effect until they are filled or canceled.
  • If an order is not a day order or a good til canceled order, the trader typically sets an expiry for the order.
  • Immediate or cancel (IOC) means that the order only remain active for a very short period of time, such as several seconds.
  • An all or none (AON) order specifies that the entire size of the order be filled, an partial fills will not be accepted.
  • fill or kill (FOK) order must be completed immediately and completely or not at all and combines an AON order with an IOC order.

Words from Warren!

  • Wise investing is made up of multiple factors, like Mr. Buffet says: Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years, he also advises:
  • It’s better to hang out with people better than you. Pick out associates whose behavior is better than yours and you’ll drift in that direction.

Thank you for reading, we are looking for your questions comments, and concerns. If you need further support please feel free to reach out and we will get back to you!

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