The 8 Rules of Penny Stock Trading

The rules of penny stock trading are simple: up, down or sideways. But the question is which one and what time? Therefore, having a set of trading rules and stick to them will save you from many of the common mistakes.

Below is a list of 8 rules for you to consider:

1. Flexibility

Don’t fall in love with a stock. There are hundreds of penny stocks to trade.
2. Take care of your hard earned money
Nobody has right all the time, but might make disastrous mistakes. The rule is to minimize your losses when you are in the wrong position. Many “geniuses” has lost all their trading capital by just one mistake. Most of them have never returned after a big loss.
3. Always set stop-loss
Stop-loss is the road to victory, and will save you from defeat. It’s a security ventilation to protect your money.
4. Learn from your mistakes
You might learn more from your mistakes than from your gains. If you learn from your mistake, then it will no longer be a loss in the future.
5. Trading plan
The foundation for your profit starts before you make a buy or a sell. Spend time to find a method that suite your trading style.
6. Don’t let coincidences fool you around
The small details are often what distinguish the gains from the losses.
7. Patience
The three pillars of learning are – training, pain and hard work. There are no shortcuts in the stock market. So be prepared for several years training and hard work before you become a master.
8. Passion
Only those with passion can become a master. If you trade with strong desire to earn lots of money, you will hardly be successful. You must have an interest and passion in what you do deal with.