Why Are Investors Getting Depressed?
Why do investors in the stock market get depressed
There can be serious psychological problems especially for investors who have just started trading in stock markets.. These problems can even drive investors to suicide.. So, what are the reasons that lead them to depression or even suicide?
Exchanges are places where opportunities are concentrated.. Every day trader starts the day with the hope of a good profit.. But not everyone is successful in this.. The biggest reason for this is that an investor does not have the personal characteristics to trade in stock markets.. However, it is difficult to win in the stock market without the necessary education, knowledge, research and experience.. The worst is the stock market where it’s easiest to lose money. For this reason, an investor must be multi-disciplined in order to win the stock market.
The Effects of Investor Loss
It is not difficult to understand the psychology of an investor to trade in stock markets.. Unfortunately, the goal of losing-prone investors in the stock markets is to make fast and good money.. But not everything goes as planned in the stock markets.. On the contrary, the stock markets do not act according to our plan.. However, everything is more difficult for the investor who loses in the stock markets.. Because it’s hard to accept losing when there is a big chance to win.. Ultimately, this process drags many investors into depression.. There are many stock market investors who commit suicide as a result of such crises.
In this article, we will examine the reasons that cause investors to lose and become depressed.
Why Investors Can’t Resist the Depression
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Bad management skills
Bad management skills are the main factor that causes an investor to lose in stock markets. Those who invest all their money in the stock markets immediately cannot afford the heavy price.. In fact, the first thing an investor should do is calculate risk.. On the contrary, amateurs who trade in the stock market without making these calculations cannot bear the heavy burden of the negative situation.. Because the risk they take is more than they can handle.
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They trade without understanding the market
Without understanding the market ignorant and inexperienced traders often lose. In fact, there is a fact that no one knows exactly what will happen in the stock markets.. Moreover, stock markets are such a risky place to hit an investor hard just because of one position.. Trading without understanding the market is the biggest mistake an investor can make.. When looking at investors who get depressed or commit suicide, it is generally seen that there are such investors.
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They open positions without a stop-loss instruction
The reason why investors who experience big losses in the stock markets experience big losses is that they do not put stop-losses.. All investors experience loss and gain in stock markets.. The problem is not having the ability to limit the loss.. Limiting the loss is also possible only with the stop loss.. In general, it is seen that those who experience big losses play in the reverse trend in a big trade and because they do not set a stop loss, they experience big losses with the continuation of the trend.
- Trading with Leverage
An investor should always stay away from leveraged trading. Leverage means borrowed money.. Trading with borrowed money in stock markets means gambling your life.. The probability of winning is very low.. Undoubtedly, the market is a complex structure built on uncertainty.. Uncertainties also often work against investors. These uncertainties cause greater losses to traders trading with leverage.. Ultimately, the investor also has to return the borrowed money.
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Failure to apply learned concepts properly
A person takes training or courses from academies to become an investor. Just as not all students get good grades in the course, the same is true for investing.. Not every investor has the same success in investing.. Investing concepts and principles are open to all investors. Even if all investors read them and learn, they cannot apply them with the same success.. They suffer losses with unsuccessful investors who think they’re doing it.
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Greed
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Another point to be considered in investing is knowing how to take profit.. An investor should know when to take the profit and exit the position. Because profitability and growth cannot continue continuously and ends at some point and often reverses.. Loss may return if even a profitable position is not exited.. This type of transaction is the most frustrating for an investor.. Not exiting despite making a profit, then making a loss with the reversal of the trend.. This upsets an investor’s emotions and psychology.
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Emotions
Emotions have no place in stock market investing. In fact, any Twitter trader is a bad indicator for an investor.. The stock market investor must have a steely psychology. He needs to discipline his emotions.
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Investing with advice
One of the most common mistakes investors make is advice. are to invest in. A stock market investor must have a disciplined and fundamental understanding of investing that is built with a solid and good strategy.. But undisciplined investors can be greatly influenced by a tip and advice they hear.. As a result, such recommendations will not bring long-term success.. Before making an investment, first a trend analysis and then a technical analysis should be done.
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Lack of information
Investors who do not have the necessary knowledge, training and equipment are doomed to lose.. To be a stock market investor, it is necessary to know how to analyze the stock market and to analyze it regularly.. If a person does not have the knowledge, education and experience to trade in the stock market, he will constantly make wrong decisions.. These will cause him to lose his capital.
Source: Niftytradingacademy
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