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Top Most Reason of Loosing Money in Commodities trading

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Lost Money in trading

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As we all are Commodity Trader, so this post is really very much important to know as well as need to understand the facts ...


If you have not heard by now, most people who trade commodities lose money. Most of the estimates range in the 80 to 95 percent range of those who have lost or who are losing in the world of trading commodities. Those statistics are dismal for someone who wants to venture into trading commodities. Fortunately, many of the losers have common traits that contribute to their losing and they can serve to help others become successful.


Here are four of the most common reasons why commodity traders lose money. If you can have the discipline to consistently overcome these common mistakes, you will put the odds much more in your favor.

Lack of Education on Commodity Trading


Many new traders do not educate themselves on how to trade commodities properly. This goes beyond learning the ticker symbols, futures margins and contract sizes of a variety of commodities. You are competing against other traders who have had the best training in the business and have been trading professionally for many years. Believe me, they will not take it easy on you. You keep score with money in this business and everyone is trying to score as many points as possible – no charity here.


At the very least, I recommend reading several good books on trading, starting with Trading By The Book by Joe Ross and Come Into My Trading Room by Dr. Alexander Elder. Don’t just read the books – implement their trading philosophies. I would also suggest learning how to trade from a successful trader. There are many professional traders available for instructing or you can take classes specifically devoted to trading commodities.

Over Leveraged Commodity Trading


Almost every small trader who ventures into commodities falls into this trap. There is huge leverage when trading commodity futures and a couple bad trades can wipeout the over leveraged trader. Fortunately, there is a simple rule you can follow to take care of this problem - do not risk your whole account on one trade. Also, do not trade a contract that is too large for your account size. For example, you shouldn’t trade three futures contracts that average a $2,000 move a day when you have a $10,000 account.

Money Management


Do not risk more than 5 percent on any one trade. Most professional money managers risk less than 2 percent on any one trade. This is tougher if you start trading commodities with only a $10,000 account. In this case you should risk no more $500 on a trade. If you want to risk no more than $500 on a trade, all you have to do is place a stop loss order $500 away from you entry. It doesn’t guarantee you won’t lose more than $500, but it is as close as you can get.
Money Lost in trading

Commodity Trading Plan


I cannot stress enough how important it is to have a trading plan in place before you begin trading commodity futures. A trading plan is your guide to how you will control your trading. It should be in writing and reviewed regularly. The trading plan should include the markets you will trade, your trading strategy, money management and even a plan to stop trading for a period of time if your account equity drops to a certain level. Trading without a plan will lead to erratic an undisciplined trading, which ultimately leads to painful losses.

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Successful And Unsuccessful People 5 important Difference

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some of the biggest deviations between successful and unsuccessful people. understand five of them :. 

Successful And Unsuccessful People 5 important Difference


1. Successful people adopt change. Unsuccessful people fear it. "Adopting change is one of the hardest things a individual can do," . With the planet acting quicker and technology speeding up at a speedy fastness, it's essential that we adopt these changes and accommodate, rather than fear them, deny then, or hide out from them, he says. Successful people are able to do just that. 


2. Successful people speak about thoughts. Unsuccessful people speak about people. Alternatively of dishing the dirt specialized in people - which gets you nowhere - successful people talk about ideas. "Sharing ideas with other individuals will only make them better,"


3. Successful people admit responsibility for their losers. Unsuccessful people fault other individuals. Truly successful leaders and business people experience both ups and downs in their lifetimes and careers. But they always admit duty for their losers. Kerpen says faulting other individuals solves not anything. "It just puts other individuals down and perfectly no good comes from it.". 


4. Successful people give other individuals all the credit for their victories. Unsuccessful people take all the credit from other individuals. Letting people have their instants to shine needs them to work harder, and, accordingly, makes you look better as a leader or teammate. 


5. Successful people want other individuals to have success. Unsuccessful people in secret hope other individuals fail. "When you 're in a company with a group of people, in order to be successful, you all have to be successful," . That's why the most successful people do n't wish for their loss of life ; they want to see their workfellows win and develop. 

Other major deviations : successful people exude joy, share data and info, read every day, and continuously learn, while unsuccessful people exude anger, hoard data and info, see TV every day, and fly by the seat of their pants.


FINAL WORDS,

I KNOW THERE ARE LOTS OF OTHER MAJOR IMPORTANT THINGS IN BETWEEN SUCCESS AND UNSUCCESS BUT THESE WERE JUST VERY IMPORTANT I FELT.
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