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There is a real need to find supplementary sources of income during the COVID-19 pandemic. Not only has the economy experienced a significant hit, but many people are in need of a secure source of income to help them survive the upcoming post-pandemic recession.
Many might argue that stocks are a bad investment during this time, especially considering that most investment options have lost a significant amount of value since the onset of the pandemic. While this is definitely a bad development for people who have already invested in these stocks, this makes it a perfect opportunity for someone who is looking to start trading.
Because stock prices have plummeted so low, these stocks are now more accessible. However, just because stocks are now more accessible does not make this an easy venture. There are lots of things that you need to keep in mind in order to make this a successful journey.
Always Monitor the Market
With the stock market as volatile as it is, the value of your investments can spike or drop rapidly. Also consider that with more people on the internet these days, news is going to travel fast, and current events affect the market by influencing investor behavior. It’s also difficult to constantly monitor the market, thus, a good remedy here is to have a stop-loss order in place on all short-term trades to help you minimize your losses.
Don’t Trade at Every Breakout
It can be tempting to pounce on every profit you make, especially during these desperate times. However, this is a bad decision, as breakouts are bound to be more common these days due to the volatility of the market. You need to set strict and realistic profit targets and trade only when these profit margins are met. It’s also important to set a maximum stop in order to protect yourself from incurring major losses.
Trade With Data, Not Your Intuition
It’s normal to react emotionally to different kinds of scenarios. This is also true in trading. However, opting for an emotional response in trading can cost you profit and may even be the cause of major losses. One of the most important things to keep in mind is to formulate a rational plan and to stick to that plan as best you can. Research is your friend here, and if you’re unable to perform research, you can always hire a forensic economist like the ones from The Knowles Group to help you gain a better understanding of economic trends and what you can do with the assets you have.
We understand that there are many ads online that demonstrate how easy it is to trade. The sad truth is that many of these ads do not accurately depict the process of trading. If something sounds too good to be true, it usually is. Don’t rely on these ads to gain an understanding of trading. It takes a lot of time, experience, and knowledge to trade effectively.