How to Become a Successful Trader → Rule #1: Don’t Chase Alerts
A stock trading service that sends out alerts sounds great on paper. All you have to do is follow an expert into each trade he or she takes and you’ll make bank, right? Wrong. What ends up happening in most cases is that subscribers over-allocate into single positions, buy at extended price levels, refuse to cut losses because they expect every trade to be a winner, let huge winners turn into losers due to greed, etc. They oftentimes don’t even have a foundation in the most basic trading concepts like Support & Resistance or even how to execute a trade through their brokerage platform, but are expecting guaranteed profits by blindly mirroring somebody else’s text and email alerts. It’s simply not an approach that works, especially in the world of low float stocks with high volatility.
The ideal approach is to learn from respected traders, but Don’t Blindly Enter Trades based off alerts. Start asking questions in order to gain a complete understanding of certain strategies. “Why are you choosing to trade this stock over thousands of others?” “Why are you entering/exiting at that particular level?” “Is there a specific reason or catalyst for why you’re entering this trade?” “What is your profit target on it?” “How are you going to manage your risk/stop-loss?” Focusing on the answers to questions like these is what leads to profitable, self-sufficient traders. So instead of looking for a service that can magically send you hot picks that never lose (which doesn’t exist), try focusing on the educational aspects of these programs. See if they offer interactive chat rooms, helpful communities, live trading sessions, real-time access to profitable traders, video lessons/webinars, etc. With the right mindset, strategy, and mentor, anybody can become a successful stock trader.