Getting Started in TradingBut you are not alone since this has happened to every one of our
star traders. Chuck Hays, for example, lost$50,000 in his first year
of trading. Steve Ickow made$1,500 his first day, but was down
$5,000 in his first week—and after five months, had lost$20,000.
Indi Jones lost$8,000 on his first trade, which included both his own
money and money he borrowed from his father. The difference
between most new traders and our pros is their perseverance. It
is much easier to give up trading and move on with our lives than
to have the dedication to learn from our mistakes and ensure that
we don’t repeat them. Discipline is always easy to say, but hard
to do.
Not all of us can afford losing$20,000 or even$8,000. There-
fore, we encourage you to demo or paper trade before you actually
go live. Make sure you have a decent strategy, and then start trad-
ing small and work your way up. Log your trades and analyze them
on a regular basis. Expect to lose, expect to make mistakes, it is all
apart of learning to trade, but the difference between becoming a
pro and being an amateur is the ability to improve.
- Test Before You Try
Testing before you trade live is so important for new traders that it
deserves its own section. Trading is very exciting. It is tempting to
jump into the markets and begin trading before you are even ready.
However, if you are serious about trading, we encourage you to
slow down, to test every strategy before you implement it. Hoosain
Harneker imposed a very strict rule on himself when he decided
that before putting his hard-earned money at risk, he would have
to triple his demo account three times in a row. Certainly not
an easy feat, this is also a huge barrier of entry. Yet in doing so,
he forced himself to develop a disciplined trading style that he
is able to replicate over and over again. At bare minimum, every
new trader needs to prove to himself that he too can double his
account three times in a row or triple his account two times in
a row. Technological advances have allowed many brokerages to
offer virtual trading accounts that duplicate real market activity.
We urge you to use these tools to your advantage.