0 XP   0   0   0

Checklist before proceeding

To recap this guide, I made a checklist so you don’t have to read every chapter again in detail. You should use this checklist and only proceed with other guides (mentioned in the next chapter) when all boxes are checked. Reread chapters in this guide if you are not comfortable yet.

1. Healthy personal finances

The first major important step in your trading and investing journey is having a healthy personal financial situation. Never invest or trade money you need in the near future. Never borrow money to enter positions unless you exactly know what you are doing. Only risk money you can comfortably lose. Only trade and invest money if you have zero regret of losing it.

Action: Did you check all the steps mentioned in chapter three: The basic principles of money management

2. Invest time

The next major step is investing time. If you want to be a successful investor or day trader, you need to spend hundreds or even thousands of hours learning and testing. You should not think this is exaggerated. Be prepared to give up certain things in your life if you have the goal of living from money earned by trading or investing. Close your knowledge gap by reading books, guides on this website, youtube videos and more. 95% of all investors and day traders lose money in the long term. Because they simply give up or have no clue what they are doing because they didn’t invest time in learning the details. Prevent being one of the 95%.

Action: Are you prepared to invest hundreds or even thousands of hours to master the skills needed to become a successful investor or daytrader?

3. Goals

Have you determined your goal and is this a healthy goal based on how much time you want to invest? If your goal is to make a lot of money, you need to invest hundreds and probably thousands of hours. If your goal is to make a lot of money but you have no intention to spend time on achieving this goal on a daily basis you will most likely fail. Make sure your goal is tied to the time you want (or can) invest.  

Action: Have you determined a clear and realistic goal?

4. What kind of trader do you want to be?

This is an important step because you can’t do everything at once. Have a realistic goal and pick the best market that is complementary to your goal. You should not trade crypto if you have a hard time mastering your emotions. Some people can’t stop panicking when prices collapse. You know yourself best, can you master your emotions? Pick a strategy and market that fits your personality. Not everyone can be a day trader. You have to be a determined emotionless robot that trades consistently with predetermined strategies.

This is also tied with healthy personal finances and investing time. Because it’s much harder to become emotionally attached if you lose money you already know you can lose with no regrets. You need to invest big amounts of time to figure out and test trading strategies that are profitable on a consistent basis. If you want to be an investor buying stocks you need to know everything about fundamental analysis (reading and comparing income statements) and if you want to be a day trader you need to know everything about technical analysis (chart psychology and using several indicators). I got both covered in two in-depth guides you'll find on the next page..

Action: Do you have a clear vision want kind of trader or investor you want to be based on your goal?

5. Conclusion

Becoming a successful investor or day trader is hard. Especially if you have the goal of living your life as a trader making thousands of dollars a month. There is a simple reason why 95% of all investors and day traders fail: they have no clue what they are doing. If you want to be a successful investor or day trader you need to do exactly what successful investors and day traders are doing. Warren Buffet did not become the most successful investor in the world by occasionally looking at income statements. He’s been looking into financial data for the last seventy years (!) on a daily consistent basis. Just like athletes are busy with their sport all day every day. It’s a lifestyle. This is where the successful 5% is separated from the failing 95%. 95% fail because they only think about making $$$ and not putting in the time to find out why strategies work or not or blindly copy strategies while they have no idea how the strategie actually works.

This is not meant to scare you. Just be aware that making money with trading and investing is not a simple task. In the next chapter I'll guide you to the next steps.

6. Must reads

It's not mandatory but if you want more in-depth information about the things mentioned in this guide you should read the following books:

Subject: Personal finances

The Richest Man in Babylon: Original 1926 Edition

The Richest Man in Babylon: Original 1926 Edition

Learn the basic principles of personal money management

View book on Amazon.com

Early Retirement Extreme: A Philosophical and Practical Guide to Financial Independence

Early Retirement Extreme: A Philosophical and Practical Guide to Financial Independence

Early Retirement Extreme: A Philosophical and Practical Guide to Financial Independence

View book on Amazon.com

The Millionaire Next Door: The Surprising Secrets of America's Rich

The Millionaire Next Door: The Surprising Secrets of America's Rich

The Millionaire Next Door: The Surprising Secrets of America's Rich

View book on Amazon.com

Subject: Investing in stocks

One Up On Wall Street

One Up On Wall Street

One Up On Wall Street. Find hidden gems in the stock market not touchable by Wall Street and not noticed by the masses.

View book on Amazon.com

The Intelligent Investor

The Intelligent Investor

Learn everything about value investing from the mentor of Warren Buffet.

View book on Amazon.com

Subject: Creating your own business

UNSCRIPTED: Life, Liberty, and the Pursuit of Entrepreneurship

UNSCRIPTED: Life, Liberty, and the Pursuit of Entrepreneurship

Life, Liberty, and the Pursuit of Entrepreneurship

View book on Amazon.com

Chapters: Trading and Investing Guide for Beginners

Comments

Join the conversation.

Leave a comment

Stay informed with my latest content.

Subscribe to my newsletter and receive an email as soon as I add content to PenkeTrading.com.


By clicking Register, you agree to the General Terms and Conditions.
Penke's Market Notifications
AAGH.PINK
8 minutes ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of AAGH.PINK.

AAGH.PINK Daily Candlestick Chart
WSNAF.OTCQB
11 minutes ago

I found you a STOCH Bearish Reversal Divergence on the daily chart of WSNAF.OTCQB.

WSNAF.OTCQB Daily Candlestick Chart
XINT.ST
45 minutes ago

I found you a Bearish Three Line Strike Candle Pattern on the daily chart of XINT.ST.

XINT.ST Daily Candlestick Chart
ELAN.NYSE
1 hour ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of ELAN.NYSE.

ELAN.NYSE Daily Candlestick Chart
EIGR.NASDAQ
1 hour ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of EIGR.NASDAQ.

EIGR.NASDAQ Daily Candlestick Chart
EFSC.NASDAQ
1 hour ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of EFSC.NASDAQ.

EFSC.NASDAQ Daily Candlestick Chart
DZZ.NYSE ARC
1 hour ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of DZZ.NYSE ARC.

DZZ.NYSE ARC Daily Candlestick Chart
CANS.V
1 hour ago

I found you a Overbought RSI (Relative Strength Index) on the daily chart of CANS.V.

CANS.V Daily Candlestick Chart
DRMA.NASDAQ
1 hour ago

I found you a RSI Bullish Hidden Divergence on the daily chart of DRMA.NASDAQ.

DRMA.NASDAQ Daily Candlestick Chart
DRFS.PINK
1 hour ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of DRFS.PINK.

DRFS.PINK Daily Candlestick Chart
DISH.NASDAQ
1 hour ago

I found you a STOCH Bearish Hidden Divergence on the daily chart of DISH.NASDAQ.

DISH.NASDAQ Daily Candlestick Chart
EDGE.TO
1 hour ago

I found you a Golden Cross on the daily chart of EDGE.TO.

EDGE.TO Daily Candlestick Chart
ENRG.V
2 hours ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of ENRG.V.

ENRG.V Daily Candlestick Chart
EFR.TO
2 hours ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of EFR.TO.

EFR.TO Daily Candlestick Chart
DML.TO
2 hours ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of DML.TO.

DML.TO Daily Candlestick Chart
DOO.TO
2 hours ago

I found you a Bullish Three Line Strike Candle Pattern on the daily chart of DOO.TO.

DOO.TO Daily Candlestick Chart
CIX.TO
2 hours ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of CIX.TO.

CIX.TO Daily Candlestick Chart
BYL.TO
2 hours ago

I found you a STOCH Bearish Hidden Divergence on the daily chart of BYL.TO.

BYL.TO Daily Candlestick Chart
3LLV.PA
2 hours ago

I found you a MACD Bearish Reversal Divergence on the daily chart of 3LLV.PA.

3LLV.PA Daily Candlestick Chart
MAC.LSE
3 hours ago

I found you a STOCH Bearish Hidden Divergence on the daily chart of MAC.LSE.

MAC.LSE Daily Candlestick Chart
KCT.LSE
3 hours ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of KCT.LSE.

KCT.LSE Daily Candlestick Chart
S5FI.INDX
3 hours ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of S5FI.INDX.

S5FI.INDX Daily Candlestick Chart
MMFI.INDX
3 hours ago

I found you a STOCH Bullish Reversal Divergence on the daily chart of MMFI.INDX.

MMFI.INDX Daily Candlestick Chart
STU.V
4 hours ago

I found you a STOCH Bearish Reversal Divergence on the daily chart of STU.V.

STU.V Daily Candlestick Chart