Why Retail Investor Lose Money in Equity / Commodity Markets?
Trading in equity or commodity markets is never an easy task to do, but follow are some basic reasons why retail traders or investors lose money in markets:
- He is among the last few people to enter into the Bull Run.
- He keeps on changing a single stock.
- Never put the Stop Loss in the System.
- Always the first one to exit from the stock which are in Bull Run, with minimum profit.
- Don’t have a Habit of Trading by Robotics Mechanism.
- By doing Emotional Trading, Holding the positions in Loss and cutting down the positions early in profit.
- Lack of home work before entering in a stock.
- Lack of resources about the movements and news which effects the stock market.
- Too much greed from a single stock.
- Day dreaming in stock market also makes him suffer huge losses.
- Never traded with the trend of the markets.
- Fear in going shorts in stock.
- Was not able to stay away from the market when it is sideways.
- Didn’t invested money in sectors which are outperforming the index.
- Listening to rumours and investing money there.