74.80 % of retail investors lose their capital when trading CFDs with this provider.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.80 % of retail investors lose their capital when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

5 + 2 most common mistakes in online trading and how avoid doing them

Whether you are new to trading in the financial markets or want to further expand your knowledge in this field, it is important to think about your own approach to this difficult discipline. That's why we've broken down the 7 most common trading mistakes for you and added tips on how to avoid doing them.

Chyby v online tradinguToo much emphasis on money

It is very difficult to evaluate trading in other terms than in nominal value, because it is still a matter of trading price changes in time. A successful trader can be identified by how much money he has made. One of the most common mistakes is putting too much emphasis on money, which often completely blinds your decision. The market doesn't care if you are in profit or in a loss. There’s a reason why you can often hear that everyone should do what they really enjoy in life and money will find its way.

How to avoid this mistake

So start thinking about trading differently. Try to make "nice" trades according to your business plan. Look forward to new opportunities every day. After all, you're just throwing money from one pile to another. If you do trading purely for money, you can't be successful in the long run.

Frequent change of strategy

In their beginnings, everyone is looking for a strategy that suits them best. These strategies have often one thing in common - they have been profitable in the past. However, trading on the real market with real money is a bit different, and once the first failure comes, the trader begins to blame the strategy. He questions his success very quickly and immediately looks for another strategy that he would like more. And so it goes on and on.

How to avoid this mistake

Successful traders believe that every strategy is profitable. It's just traders who are not. Nothing is free and nothing can be earned right away. You have to study the strategy, discover its strengths and weaknesses, realize that you are the one who usually makes mistakes, and when the strategy has a worse period, you have to overcome it and be prepared, because a better period will come again. In the meantime, if you start flirting with another strategy, you will never be able to reap the benefits of the previous strategy and you will be in a vicious circle that will never make you a profitable trader.

Inability to tame one’s ego

No one enjoys losing, especially not a competitive person. Not just trading, but your whole life is about learning to accept losses. Over time, you can lose your hair, friends, family, work, and it's always about how quickly you can recover from the loss and move on. Sometimes it’s our ego that doesn’t let us get through the loss, and especially men tend to feed their ego even more. In trading, however, the bigger the ego, the smaller the gains.

The most common consequences of overgrown ego in trading are:

  • constant obsession with lost trades,
  • excessive effort to close the trading day in profit,
  • early closing of trades,
  • blaming your failures on business strategy.

How to avoid this mistake

The Holy Grail is in each of us. Markets operate on the basis of mechanisms that have nothing to do with our ego, so you must get rid of your ego as quickly as possible. Focus on consistency and adherence to the trading plan, be patient, learn to admit loss and move on to the next opportunity if the trading strategy gives you a signal. Don't try to bring it back to the market right away, because it will punish you again. For example, you can train meditation when you look at your ego from a perspective and ideally find that it is not something that should control you.

Fear of loss

We are each unique in our own way and just like one trader can handle hundreds of trades a day, another will not trade all week, and both can follow the same strategy. Despite initial failures, many traders are unable to decide whether the opportunity they are seeing is the right one, and sometimes they even over-analyze the markets and end up without opening a single position. The reality is that the fear of losing completely eliminates them from the game. Here you can learn a lesson from professional athletes. Do you think that Michael Jordan was thinking about what if he accidentally hit the hoop every time he was trying to score?

How to avoid this mistake

Fear is just an illusion that we create ourselves by projecting the future, which, however, does not have to take place at all and basically does not exist. The danger in the markets is very real, but fear is just a choice. Fear can only hurt us, because with it you enter every trade with failure on your mind. Try to interpret fear as enthusiasm for another opportunity that the market has offered you, and instead of projecting a negative future, imagine how you realize one profitable trade after another.

Neglecting the business diarybusiness diary

Especially beginners, but also advanced traders are advised to write a trading diary. However, it does not include only the date, the price you entered and the result. You should also write down what you feel when opening the trade and what is going through your head during it. How else do you want to avoid the same mistakes that you may keep repeating. Writing a diary itself is a step towards greater discipline, which over time can eliminate frustration and fear.

How to avoid this mistake

You can also gradually interpret your losses so that they are part of the entire trading system. After all, trading is basically working with probability, and just by learning from your losses you can increase your probability. A bad trade will only be the one from which you will not take any money or experience. Likewise, if you are going through a rougher phase, you can always return to previous trades from when the strategy worked and look for patterns why the strategy is not working this time.

Insufficient consistency

Doing things regularly is one of the few qualities that unites successful people across all professions. Have you ever seen a farmer water a field only when he wants to? The problem with consistency in trading is that many traders are blinded by the daily gain they cling to. You should not try to be the type of trader who tries to hit one big trade and then gradually hand over his profits to the market.

How to avoid this mistake

There is nothing wrong with not finding an opportunity in the market. However, it is bad if you make a few losses and then take a break for a month and return to trading with the fear that you have missed something and that a worse period awaits you again. It is said that the habit is an iron shirt, and although the routine may sound boring, remember that you do trading because you enjoy it, and if you have it differently, you might want to wonder if this is really what you want to do.

Not enough discipline

Discipline is one of the basic qualities that every trader should learn right from the start. That is why business plans and diaries are created so that we have a fundamental basis for everyday trading. If you've read all the previous mistakes we have mentioned, you may already see a pattern here. Changes in strategy, ego, fear, diaries, consistency, it all ultimately stands and falls on a discipline whose task is to connect all these qualities and bring a soothing calmness into an unstable mind.

Theoretically, it's very easy to say that I will stick to a business plan and open and close stores only if strategy allows. In practice, however, we cannot completely eliminate emotions, and after a series of losing trades, we embark on trades that are against the plan, do not use stop-loss, choose too large positions, or do not prepare sufficiently for all possible scenarios.

How to avoid this mistake

If you stay disciplined, you can't blame anyone but your strategy because you're doing everything right. Loss is much easier to accept if you are able to say that you have done your best.

In conclusion

So, did you see yourselves in these mistakes or not? The purpose of this article was to point out the most common trading mistakes and give you, the readers, the opportunity to avoid them (if you don't make them) or to learn from them (if you do). If you've identified yourself with any of these mistakes, it's reason for a celebration rather than the opposite. Identifying one's own mistake is the first step to overcoming it. We wish you successful trading!


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Your capital is at risk.
74.80 % of retail investors lose their capital when trading CFDs with this provider.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.80 % of retail investors lose their capital when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.