It’s natural to be biased as a trader. It can be difficult to avoid these instincts but they can prevent you from reaching your goals of becoming a successful trader. We’ve created a guide on the top 5 cognitive biases that will affect you as a trader.
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Table of Contents
Why Are Cognitive Biases A Bad Thing For Traders?
Some of the most damaging affects of being a biased trader include: deviation from your trading plan, keeping stops too tight, exiting or buying at the wrong time, exiting trades too early, developing a reliance on crowd-driven information, missing out on a trades because of preconceived notion of price, hanging on to losing trades, and delaying cutting your losses.
Don’t let your biases ruin your trading success. Check out some of the top 5 trading biases and learn to prevent them.
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Now that you understand the importance of not being a biased trader, you can start focusing on success in the Stock Market. It can be tough to control these natural instincts, but it will benefit you greatly if you can. Just remember to get all of the information you need before deciding on a trade, stay off the trading bandwagon and form intelligent decisions, and understand where you’re getting your information.
Control your biases and you’ll be set for success! Happy trading!
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