Reasons Why Intraday Traders Lose Money in the Stock Market

When you raise this question, ‘why am I losing money on intraday?’ then you must learn the sensitivity of the trade and sensibility that you need to maintain throughout the Intraday. Still, by the end of the read you too will carve yourself to make more money than losing money on Intraday, so stop worrying ! 

You need to just follow the guidelines mentioned below such as well planned trading strategy, best alternatives, risk management, leverage, stop-loss, & lack of technical analysis. 

Guidelines to Avoid Losing Money in Intraday: 

You should be more cautious while you are a participant in a stock trading scenario, and be absolutely active while doing a trade on intraday rules. 

Be sensible, remember, you are into stock trading only to make money by applying  the predefined  well planned trading strategy in the form of a trade plan for the day. 

In case your strategies turn down your trading approach in the stock market then find the best alternatives and exit the trade positions. All this, just to avoid losing money on Intraday. 

A Word of Caution: 

Never move forward to participate in  vengeance trading to gain control over the incurring losses. Instead, stay cool , appreciate the loss and willfully withdraw from the trade. You need to maintain patience and control your emotions. 

Functionally, you must realize when to trade and when to keep away from stock markets although the fundamental rule says as the share prices rise you need to buy and as they begin to fall, it is time to sell out by executing exit positions. 

You need to strictly practice risk management, for instance, It is a situation where you have to buy and sell the stocks on the same day and if you are about to incur losses then you can make an attempt to reduce it by converting the shares into deliveries. This sounds funny, but a change in your trading strategy in times of crises is never an issue to bother. 

Utilizing Leverages

Stock brokers provide leverage on your trading capital, it goes up to five times the trading capital, you must be careful in opting for it. It is very tempting to make higher investment on your selected stocks through leverage, if chosen, you can confront risk on trade in a time when the stock trend movement is unfavorable to your trading strategies. 

In case your trade goes upside down, you will have lost a part of your trading capital, and also make a payment of the leverage taken from the stock broker. 

In an intraday trading session, the trailing of the stock prices can cause an immense loss on your investment. In such circumstances, the stock market has provided a mechanism to limit the losses,  known as stop-loss. When the share prices touch the set limit value, the stock market sells the share thus protecting further loss.  

Another reason for encountering loss in the stock markets is lack of technical analysis. The candlestick charts provide information to identify entry position, exit position, and the patterns help to exploit the bullish/bearish markets. 

With no prior knowledge, you will find it difficult to cope up with the trading signals and at some point while trading might lose money in intraday.