Don’t Aim for a Home Run When Trading

In baseball, few things get the crowd cheering quite like a home run. Trading can feel the same way, and there’s no doubt that hitting a home run has a certain thrill. However, hitting one is not always so easy, and many traders may find it easier to aim for singles and doubles.

Trader’s psychology can contribute to both positive and negative results. When we talk about the mental game involved in trading it’s important to set limits around profits and losses and then exercising self-control to stay within your set boundaries. Doing so can help traders log more consistent and profitable results.

Work on Your Short Game

Avoid the temptation to chase a home run trade and focus on making incremental gains in your stock portfolio. Some traders believe that making money requires home run trades. Maybe they knew someone who bought a stock for $10 a share and it sold for $200 a share. This can and does happen, but what you must realize is that while everyone wants to talk about their home runs, not everyone wants to be so honest about their strikeouts.

Seasoned and sophisticated traders often look to hit singles and doubles rather than swinging for the fences. One way to do that is by focusing on trading stocks with high volume. This way there are more stocks available on both sides of a trade. If you find out that your initial decision on a particular stock was incorrect, it is much easier to get out of a position and mitigate your risk. Volume tends to be highest in the morning and afternoon, with somewhat of a lull in the middle of the day as people are away on lunch breaks. Remember slow and steady wins the game.

Trading with The Lightspeed Platform

The Lightspeed Trader® platform can help you find stocks with high volumes throughout the day.  In Lightspeed Trader there is a ‘Risers and Fallers’ window that shows the most active securities traded and their current volumes. In that window, you can filter by price or minimum volume levels. For additional volume filters, Lightspeed Trader users can request a free add-on called Lightscan. Lightscan allows traders to sort by other volume categories like average 30-day volume and previous day volume.

Lightspeed™ provides day traders with all the tools required to help them find success in stock trading, and we have been developing and honing our active trader platform to offer the best possible user experience in the marketplace. With the intuitive interface layouts and institutional quality stock and option scanners, we aim to help traders reach their goals, no matter what their strategy is.

For more information on the Lightspeed trading platform and to set up an account, please call us at 1-888-577-3123, or request a demo today.

Lightspeed Financial Services Group LLC is not affiliated with these third-party market commentators/educators or service providers. Data, information, and material (“content”) are provided for informational and educational purposes only. This content neither is, nor should be construed as an offer, solicitation, or recommendation to buy or sell any securities or contracts. Any investment decisions made by the user through the use of such content is solely based on the users independent analysis taking into consideration your financial circumstances, investment objectives, and risk tolerance. Lightspeed Financial Services Group LLC does not endorse, offer nor recommend any of the services or commentary provided by any of the market commentators/educators or service providers and any information used to execute any trading strategies are solely based on the independent analysis of the user.

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