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What Makes Stock Trading So Difficult for New Traders?

black and silver laptop computerFor most traders, perhaps the most challenging time is when they are getting started with the stock market. Indeed, many of them drop off, never to be seen again near the stock markets, prompting the big question, “What makes trading stocks, such as USA 500 equities, so difficult for new traders?”

Before looking at these challenges, we have to indicate that it is not just newbies who find trading stocks challenging. Even experienced professionals also experience challenges, but we are here to help. Keep reading to understand the main reasons for these challenges and how to address them:

Basing their Trading Decisions on Emotions

When you join the stock market, the trading psychology and personal ability to control emotions will be crucial in defining your career’s success. Some traders, especially newbies, are unable to deal with the stress that comes with the stock markets and fall into the dangerous trap of making decisions emotionally. Think of a situation where you selected a specific USA 500 stock expecting its price to go up, but the reverse happens, resulting in some loss.

Sure, you are bound to feel upset, but that should not make you get out of your trading plan. Instead of simply opening another position in haste, it is important to control your emotions and think of what might have gone wrong. Take some moment to rethink your strategy and enrich it where necessary to increase the chances of success. For example, you might want to consider combining technical and fundamental indicators to increase the chances of making correct predictions.


Overtrading is one of the common mistakes, especially among new traders. It is not uncommon to see a new trader watching over 20 charts, following more than USA 500 stocks or Tech 100, and making more than 50 trades in a single day. These traders are driven by quantity as opposed to quality, while the reverse should be the way to go.

Trading is like a favorite sport, which makes one feel like going on and on, but this is likely to result in failure. The best trading strategy is to follow your plan, target to identify just a few opportunities and capitalize on them. If you miss a great opportunity, it should not be a reason for jumping into the next one without proper analysis. Know that another opportunity will present itself.

If you notice an opportunity has been missed, a good way to deal with it might be taking a break. Perhaps grab a cup of coffee and resume after some moment to scout for new opportunities. Remember to also take note of key fundamentals, such as reports on employment rates, because they greatly impact the market.

Getting Overwhelmed by Data

The world today is full of data travelling at supersonic speed. You can receive news of a top USA 500 Stock plummeting and get the same report in all news channels on the globe within minutes. For a trader who loves staying informed, which is a good thing in the stock market, it is easy to get overwhelmed and end-up with wrong decisions. So, how are you supposed to deal with the sea of data when trading?

Here, you only need to identify one or two things and follow them. You can easily achieve this by working on a demo account. For example, if you prefer technical analysis for trading stocks, you might want to only follow one or two indicators. With time, you will be able to see how the strategy works, improve it, and increase the chances of operating more successfully.

Fear of Missing Out

For new traders, reports that other people are making huge profits or a big move s is about to happen, even when such information is not based on truth, can push one to open positions without analyzing them well. The fear of missing out (FOMO) is a serious challenge because it creates a feeling that one is lagging behind. Indeed, FOMO is also a major challenge even for experienced USA 500 or TECH 100 stock traders.

To address the problem, you need to cultivate a high level of personal discipline. Even when you get news of an expected stock movement, the first action should be carrying out further analysis before making a decision to open trade. When you persuaded to open a position, always use an appropriate stock risk management strategy, such as a stop-loss order or 1% rule to avoid losing a lot of cash if the price moves against your prediction.

Working with the Wrong Broker

Trading stocks, such as USA 500 or other instruments today is pretty easy because all you need is a broker and some cash deposits. However, the broker you select can make or break your career as a stock trader. For example, if a broker has very high transaction fees, there is a risk of the bulk of your profit getting eaten away. This is why you should take your time to pick a good and trusted broker. Be specific about the following attributes when selecting a trading broker:

  • Only select the broker with an easy-to-use trading platform.
  • Read through reviews to identify the broker who is trustworthy.
  • The broker should have multiple payment and withdrawal options for clients.
  • Good customer support should be a must-have for the selected broker.
  • Support for multiple financial instruments, from USA 500 stocks to precious metals.

One broker that ticks right in all the attributes that we have listed above is The broker is committed to helping traders find most of the trading information on one point to simplify their work. Visit their website to learn more and start trading your preferred stocks.

This post has revealed the leading causes of high losses among new stock traders. The secret to becoming successful in the stock market is to make every experience, whether negative or positive, a learning opportunity. Then, stick to your strategy and look for ways to improve it over time. Remember to also try different trading instruments to diversify your trading portfolio.