Bad behavior can cause tangible damages. According to ScienceDirect, in workplaces that tolerate bad behaviors, 48% of those affected by those bad behaviors put in less effort at work, 47% spent less time at work, and 38% turned in poorer quality work. Bad behavior can come with a price tag, too. According to the Fines & Fees Justice Center, the national court debt in the United States—the amount of money owed to courts for fees and fines—is estimated to be at least $27.6 billion. Bad choices and decisions have consequences, and some industries are more prone to them than others.
“When first starting their day-trading career, people should be made aware just how consequential their choices can be,” says Gary Trades, a professional day trader and co-founder of the Goblin Gang trading team. “One bad trade is all it takes to wipe out months’ worth of profits if people aren’t careful and don’t learn to pace themselves and stay disciplined.” He goes on to list some of the most damaging behaviors day traders engage in.
Relying Solely on Tips
The day-trader industry is full of people who are willing to share their plays and help others out. Gary Trades’ mission is to help people be better at trading and harness its power to change their lives for the better. Those efforts come with a caveat, though; eventually, people should learn how to make trades of their own.
“It’s really simple; anyone who wants to understand trading needs to do a lot more than just copy someone else’s trades,” explains Gary Trades. “If that’s all they do, people will never be able to call themselves traders, and they won’t know how to jump at great opportunities or avoid losses unless they see someone doing it first.”
Never Using a Stop Loss
“A stop loss is the life-saving instrument and one of the first things people should learn how to use,” says Gary Trades. “With it, people create an order to sell an asset when its value hits a particular low, protecting themselves from greater losses.”
Even people who are more willing than others to tolerate risk should set up a stop-loss order. Stop-loss orders protect people from their worst instincts and can be the only thing standing between a trader and a loss that could wipe out all they have on the market.
Giving In to Emotions
The emotional and rational might be equally important for a well-rounded life experience, but they’re not equally important in every situation. When it comes to trading, for example, emotions should take second place in calculations and analyses.
“It’s very easy to get swept up by the moment when day trading,” explains Gary Trades. “The results might be great, but they can also be devastating. Usually, it’s the ability to stick with a game plan that wins the day, and not giving in to excitement, euphoria, fear, or anger.” Fittingly, his parting advice is that “the gut should be listened to, but not followed blindly.”