I wasted so much money making these everyday trading mistakes

Most jobs seem at least somewhat intimidating to outsiders. Everyone knows that a career in medicine and law requires years of training and apprenticeship. If you’re into sports, you only need to watch a track and field or ice hockey game to conclude that serious practice and skill are required even to play professionally, let alone win.

Then there is day trading. Anyone over the age of 18 can open a US account with a minimum amount of $25,000 or $500 abroad and call themselves a day trader. But that certainly doesn’t mean they will be profitable.

No one is asking you to go into the books and study the basics. There are no final exams, internships, or certification bodies that will finally allow you to “practice” this profession.

That’s only half the good news: people work like dogs in B-school, only to spend another decade working like dogs on Wall Street before perhaps becoming fund managers. In a good year, they give each other kudos when they generate a 10% return in six months.

When day trading, it is unlikely – but possible – to achieve a 100%, 200%, or even 600% return on a stock. In a single day.

Related: Learn more about the stock market with this $40 day trading package

Mistake #1: Acting without knowledge or discipline

This crazy contrast between no barriers to entry and potentially mind-blowing returns is irresistible to new traders every day. Maybe they even have a bit of beginner’s luck, like me. But here’s the reality: If you want to become a successful day trader in the long term, you must first acknowledge that most new traders will lose money and end their “career” as roadkill. Then you must acknowledge that to avoid this fate, you must do things differently than most people do.

First, although no one demands it, you need the self-discipline to learn the principles of successful day trading. Here is an example. When new traders buy a stock and it falls, they don’t have the discipline to cut their losses. Instead, they often buy more, justifying that they are being smart by dollar-cost averaging. And if the price has been high recently, it will surely bounce back.

Unfortunately, many stocks never return to the highs that made them social media darlings in the first place. We have a name for people who buy at high prices, perhaps buy even more when prices fall, and now put their money in a stock that’s not going anywhere: They are “pocket holders” because all they have left is a loss, that you can take credit for.

Second, you need the self-discipline necessary to put the principles you have learned into action. If you’ve survived the episode where you ended up as a bagholder on a stock, you now need to resist the urge to do it again. If your plan doesn’t work and you find yourself in a stock that’s trending down, you’ll have to sell based on the parameters you set before you even entered the trade. No matter what your feelings are screaming at you.

Related: 5 Things You Need to Be a Successful Day Trader

Mistake #2: Taking the path of least resistance without a strategy

There is no shortage of “experts” on the financial channels. They are absolutely sure of themselves, and after all, they must be right, or why do they have their own show year after year?

It is a mistake to get day trading stock recommendations from such people. Most of them are not day traders who need to close out their positions at the end of each day. Even if they were day traders, it would still be a mistake. Here’s why. I’m regularly asked, “Ross, I’m quick with a keyboard. Why can’t I just track what you buy, when you buy it, and when you sell it?” It’s called “mirror trading” and it doesn’t work. Not only do the markets move too quickly for you to get in and out exactly when I do, but my risk tolerance is not the same as yours.

A strategy is not the same as a hot tip; It is a set of parameters that you follow. It covers, among other things, the type of stocks you are pursuing and the terms you are looking for. Some parameters might include a focus on stocks between $1 and $10, a win/loss ratio of 2:1 or better, and a catalyst in the form of breaking news. The way to build a solid foundation of knowledge and experience is to develop a strategy and then learn it so thoroughly that it becomes as natural as riding a bike.

Mistake #3: Looking for the Holy Grail

In some ways, this is the opposite of the above mistake of not having a strategy. This suffering has too many strategies. It’s shiny object syndrome, and it occurs when traders suffer serious losses – but not career-ending ones.

I can’t tell you how many traders have taken this route. Immediately after selling a losing stock, they abandon the strategy and look for something else. You will move from small-cap stocks to large-cap stocks, then to futures, then to cryptocurrencies, and back to large-cap stocks. At the same time, they are looking for a “perfect” combination of technical indicators that works 100%.

Related: 4 Things You Need to Practice for Trading Success

Believe me, I have searched thoroughly for the perfect indicators and I am convinced that they do not exist. I also believe that I don’t need to find a perfect strategy to be successful in day trading – I just need a good plan and excellent discipline.

Work in your day trading profession. The basic knowledge of day trading is not that difficult to acquire. What’s really difficult is treating it like a job. This means you are ready to put your skills into practice, continuing to learn and refine while being patient. The Japanese have a great saying: “Fall seven times, get up eight.” It’s solid advice for any day trader.