The pandemic changed how we work and earn money. People had to make up for lost income, so they turned to side gigs and day trading.
For investing novices, you’re sure to come across the most common myths surrounding day trading. Keep reading to discover what they are.
1. You Can Get Rich Quick
People go into day trading with the hopes of getting rich quickly. That doesn’t happen. In fact, one study of 1600 day traders found that only 3% made money.
That’s because day traders don’t have the experience and they don’t know what to look for in investments. They treat it like placing sports bets on football.
2. You’re Old to Start
“I’m in my late 40s and I never invested a thing.”
That’s a bit more common than you think. Gen Xers faced several big recessions and a pandemic in their lifetimes. Each one hurt them financially, leaving them barely prepared to retire.
At this point, many Gen Xers and even Baby Boomers don’t see the point in day trading because it’s too risky and too late.
It’s never too late to invest money in the stock market. With a smart investing strategy, you could get your retirement plans back on track.
3. You Don’t Have Enough Money to Invest
How much money do you think you need to invest? Most people think that they need at least $5000 to start investing. The truth is that you don’t need that much.
Some brokers let you invest for as little as a few hundred dollars. It’s important to think like a smart trader and research your stocks before you begin trading.
4. You Can Go With Any Broker
Don’t start day trading because you signed up with a broker that offers low commissions. You often get what you pay for.
You want to make sure that your online broker is licensed and registered to operate. The broker should also offer the latest news, research, and education.
Those are the tools necessary to learn the fundamentals of trading. A good example of such a broker is www.monexsecurities.com.au/.
5. You Have to Sit at the Computer All Day
Day trading gives you a visual of someone sitting at the computer all day behind multiple screens. There’s a TV tuned in to one of the big business channels.
Day trading isn’t like what you see in the movies or TV. Most day traders make about 100 trades a month. They do a solid technical analysis and choose their stocks wisely.
Busting the Top Day Trading Myths
Day trading seems like an appealing way to build wealth quickly. The truth is that you have to do your homework and find a good broker before you become the best stock trader.
The day trading myths in this article help shine a light on some of the most common misconceptions about smart investing. Now that you know what they are, you can avoid falling into these traps.
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