Technical Analysis vs. Fundamental Analysis: Which One Matters More for Stocks?

When it comes to analyzing stocks, traders and investors typically rely on two main strategies: technical analysis and fundamental analysis. Each approach offers unique insights, but which one is more important? Or is combining both the key to success? Let’s dive into the debate.

What is Technical Analysis?

Technical analysis focuses on price movements, trends, and trading volume to predict future stock performance. It relies on charts, indicators, and patterns rather than evaluating the company’s financials or economic conditions.

Key Elements of Technical Analysis:

• Charts & Trends: Traders analyze candlestick patterns, moving averages, and support/resistance levels.

• Indicators: Popular tools include RSI (Relative Strength Index), MACD (Moving Average Convergence Divergence), and Bollinger Bands.

• Trading Volume: High volume often confirms trends or signals potential reversals.

Who Uses Technical Analysis?

Short-term traders, day traders, and swing traders benefit the most from technical analysis since it helps identify entry and exit points.

What is Fundamental Analysis?

Fundamental analysis, on the other hand, examines the intrinsic value of a stock by looking at a company’s financial health, industry position, and economic factors.

Key Elements of Fundamental Analysis:

• Financial Statements: Earnings reports, revenue, profit margins, and debt levels provide insights into a company’s stability.

• Economic & Industry Trends: Macroeconomic factors, such as inflation or interest rates, affect a company’s growth potential.

• Competitive Advantage: Brand strength, market share, and innovation determine long-term success.

Who Uses Fundamental Analysis?

Long-term investors, value investors, and Warren Buffett-style stock pickers prefer fundamental analysis to assess a stock’s true worth.

Technical vs. Fundamental Analysis: Which One is More Important?

The importance of each approach depends on your trading style and goals:

• If you’re a short-term trader, technical analysis is crucial for timing trades and spotting patterns.

• If you’re a long-term investor, fundamental analysis helps you build a solid portfolio based on strong companies.

• If you’re a hybrid trader, using both methods can provide a well-rounded strategy.

Why Combining Both Can Be Powerful

Many successful traders and investors integrate both technical and fundamental analysis to make informed decisions:

• Confirming Trades: Use fundamentals to identify promising stocks and technicals to find the best entry points.

• Minimizing Risk: Fundamentals help assess long-term potential, while technicals manage short-term risks.

• Adapting to Market Conditions: Market sentiment and economic shifts can impact stock prices beyond charts alone.

Final Thoughts

So, which is better—technical or fundamental analysis? The answer depends on your goals, time horizon, and risk tolerance. While technical analysis helps traders profit from short-term movements, fundamental analysis ensures long-term stability and growth. Mastering both can give you an edge in the stock market, helping you make smarter investment decisions.

Which strategy do you prefer? Let us know in the comments!

Everything You Need to Know About Tradeify: A Comprehensive Guide

Tradeify is a futures proprietary trading firm that offers traders the opportunity to trade simulated funds and earn payouts based on their performance. The firm provides three main account types: the Advanced Plan, the Growth Plan, and the Straight to Sim Plan. Each plan has its own unique rules, payout structures, and risk management parameters. This article will break down everything you need to know about Tradeify, focusing on the rules and policies surrounding these three account types.

1. Overview of Tradeify’s Account Types

Tradeify offers three primary account types, each designed to cater to different trading styles and risk preferences:

1. Advanced Plan: Features a real-time intraday trailing drawdown, which adjusts continuously throughout the trading day. This plan is ideal for traders who prefer a cheaper option as it does offer the cheapest costs out of all three plans.

2. Growth Plan: Utilizes an end-of-day trailing drawdown, which adjusts only at the end of the trading day. This plan offers more flexibility during the trading day, making it suitable for traders who hold positions longer.

3. Straight to Sim Plan: Also utilizes an end-of-day trailing drawdown. Allows traders to skip the challenge phase and start trading simulated funds immediately. This plan is perfect for experienced traders who want to begin earning payouts quickly.

2. Payout Policies

General Payout Guidelines

• Traders receive 90% of any profits after receiving 100% of their first $15k.

• Each account is treated independently, meaning you can withdraw from multiple accounts simultaneously, provided you meet the payout requirements for each.

• Payout requests cannot be edited or canceled once submitted.

Payout Requirements

To qualify for a payout, your account must meet the following criteria:

• Consistency Rule:

  • Advanced and Growth accounts must follow a 35% Consistency Rule.

  • Straight to Sim accounts must follow a 20% Consistency Rule.

  • This rule ensures that no single day’s profit exceeds the specified percentage of your total profits.

• Minimum Days Traded:

  • 10 Trading Days are required for the first withdrawal and between each subsequent payout request.

  • At least 5 of these days must show a profit greater than:

    • $150 for 50k accounts

    • $200 for 100k accounts

    • $250 for 150k accounts

• Account Balance Needed:

  • You must reach and maintain at least $100 in profit over the Trailing Max Drawdown limit.

  • This balance must be maintained until the payout request is approved.

Payout Windows

Payouts are processed three times per month during the following windows:

• 1st~4th

• 11th~14th

• 21st~24th

Payout requests must be submitted during these windows, and payments are issued within 24 hours of approval.

3. Account-Specific Rules and Policies

Advanced Plan

• Real-Time Intraday Trailing Drawdown: Adjusts continuously throughout the trading day.

• Activation Fee: $125 (one-time fee).

• Profit Target:

  • $3,000 for 50k accounts

  • $6,000 for 100k accounts

  • $9,000 for 150k accounts

• Position Size:

  • 5 contracts (50 micros) for 50k accounts

  • 10 contracts (100 micros) for 100k accounts

  • 15 contracts (150 micros) for 150k accounts

Growth Plan

• End-of-Day Trailing Drawdown: Adjusts only at the end of the trading day.

• No Activation Fee.

• Profit Target:

  • $3,000 for 50k accounts

  • $6,000 for 100k accounts

  • $9,000 for 150k accounts

• Daily Loss Limit (Soft Breach):

  • $1,250 for 50k accounts

  • $2,500 for 100k accounts

  • $3,750 for 150k accounts

Straight to Sim Plan

• No Challenge Phase: Traders can start trading simulated funds immediately.

• Consistency Rule: 20%.

• Daily Loss Limit (Soft Breach):

  • None for 25k accounts

  • $1,250 for 50k accounts

  • $2,500 for 100k accounts

  • $3,750 for 150k accounts

• Payout Profit Goals:

  • First payout

    • $1,500 for 25k accounts

    • $3,000 for 50k accounts

    • $6,000 for 100k accounts

    • $9,000 for 150k accounts

  • Second payout

    • $1,000 for 25k accounts

    • $2,000 for 50k accounts

    • $3,000 for 100k accounts

    • $4,500 for 150k accounts

  • Third payout (and beyond)

    • $1,000 for 25k accounts

    • $2,000 for 50k accounts

    • $2,500 for 100k accounts

    • $3,000 for 150k accounts

4. Risk Management and Drawdowns

Trailing Max Drawdown

• Advanced Plan: Uses a real-time intraday trailing drawdown.

• Growth Plan: Uses an end-of-day trailing drawdown.

• Straight to Sim Plan: Also uses an end-of-day trailing drawdown.

Drawdown Lock

• Drawdowns lock when profits exceed the drawdown limit by $100.

• For example, in a 50k Advanced account with a $2,000 drawdown, the drawdown locks at $50,100 (trailing drawdown limit + $100). Otherwise, once the balance reaches $52,100.

5. Additional Rules and Policies

Consistency Rule

• The Consistency Rule ensures that traders maintain steady performance by limiting the percentage of total profits that can come from a single day.

• Advanced/Growth Accounts: 35% Consistency Rule.

• Straight to Sim Accounts: 20% Consistency Rule.

Daily Loss Limit (DLL)

• Applies to Growth and Straight to Sim accounts.

• DLL is removed once the account reaches a certain profit level:

  • 50k accounts: $3,000 profit

  • 100k accounts: $6,000 profit

  • 150k accounts: $9,000 profit

Hedging and Trading Micros/Minis

• Hedging strategies and simultaneous trading of mini and micro contracts are prohibited.

• Traders must trade independently and avoid strategies that obscure performance.

Bots and Algorithmic Trading

• Bots and algorithms are allowed if:

  • The trader owns the bot/algorithm exclusively.

  • The bot is not used across multiple firms.

  • High-frequency trading (HFT) bots are prohibited.

6. Transition to Live Funded Accounts

Tradeify offers the opportunity to transition from Simulated Funded Accounts to Live Funded Accounts after achieving consistent performance. Key points include:

• Traders can be moved to a Live Funded Account after completing 4 payouts from the same Simulated Funded Account.

• A portion of the Simulated Funded Account balance is carried forward to the Live Funded Account, capped at 10% of the account size or the remaining profit balance of sim account - whichever is smaller.

• Live Funded Accounts offer daily payouts and a clear path to scaling through Merit Accounts.

7. Merit Accounts

Merit Accounts are designed to reward consistent and profitable traders by providing additional funded accounts. Key features include:

• Traders earn Merit Accounts by reaching $15,000 in profit across their Live Funded Accounts.

• Each Merit Account comes with its own risk parameters and profit targets.

• Traders can earn up to 5 Live Funded Accounts, including Merit Accounts.

8. Conclusion

Tradeify offers a structured and transparent environment for traders to grow their skills and earn payouts. Whether you prefer the strict risk management of the Advanced Plan, the flexibility of the Growth Plan, or the quick start of the Straight to Sim Plan, Tradeify provides a pathway to success. By adhering to the rules and maintaining consistent performance, traders can unlock the potential of Live Funded Accounts and Merit Accounts, scaling their trading capital and maximizing their earnings.

10 Good Habits to Implement to Become a Better Trader

Success in trading isn’t just about strategy—it’s about discipline, consistency, and the right habits. The best traders aren’t necessarily the ones who make the biggest trades but the ones who develop habits that keep them in the game long-term. Whether you’re a beginner or an experienced trader, implementing these ten habits can help you improve your decision-making, manage risk, and maximize profits.

1. Follow a Trading Plan

A solid trading plan acts as your roadmap. It should outline your strategy, risk tolerance, entry and exit points, and overall goals. Following a structured plan keeps emotions in check and prevents impulsive decisions that could lead to losses. A good trading plan should also be flexible enough to adapt to market changes while still maintaining a disciplined approach. Regularly reviewing and updating your plan ensures it stays relevant and effective in different market conditions.

2. Practice Risk Management

Never risk more than you can afford to lose. A common rule is the 1-2% risk rule, meaning you should only risk 1-2% of your account on a single trade. Stop-loss orders and proper position sizing are essential tools for managing risk effectively. Additionally, diversification can help mitigate risks by spreading investments across multiple assets instead of focusing on a single trade. Proper risk management protects your capital and allows you to stay in the market for the long run.

3. Maintain a Trading Journal

A trading journal helps you track your trades, analyze your successes and mistakes, and refine your strategy. By reviewing past trades, you can identify patterns, strengths, and weaknesses to improve future performance. Documenting your emotions, market conditions, and the reasoning behind each trade can provide valuable insights into your decision-making process. Over time, a well-maintained trading journal will serve as a powerful learning tool that helps you refine your approach and eliminate costly mistakes.

4. Stay Disciplined and Avoid Overtrading

Emotional trading leads to costly mistakes. Stick to your trading plan and avoid revenge trading or overtrading just because the market is moving. Patience and discipline separate profitable traders from those who consistently lose. Overtrading often stems from greed or fear, which can lead to impulsive decisions and unnecessary risks. Setting daily or weekly trading limits can help maintain discipline and prevent excessive trading.

5. Continuously Educate Yourself

Markets evolve, and staying informed is crucial. Follow market news, read trading books, take courses, and learn from successful traders. The more knowledge you acquire, the better equipped you’ll be to adapt to changing market conditions. Subscribing to financial news outlets, joining trading communities, and attending webinars can provide fresh insights and strategies. Additionally, studying different market indicators and economic reports can help you make more informed trading decisions.

6. Develop a Routine and Stick to It

Having a structured daily routine keeps you focused and prevents burnout. Set a specific time to analyze the markets, execute trades, and review performance. Consistency breeds success. A well-organized routine helps in maintaining a balanced lifestyle and prevents emotional fatigue. Creating a checklist for each trading session can ensure that you stay on track and approach the markets with a clear mindset.

7. Use Proper Risk-to-Reward Ratios

A good risk-to-reward ratio helps ensure long-term profitability. A common approach is aiming for at least a 1:2 or 1:3 risk-to-reward ratio, meaning you aim to gain twice or three times what you’re risking per trade. This strategy helps maintain a favorable profit-to-loss balance and ensures that even if some trades result in losses, the profitable trades will outweigh them. Traders who consistently follow a strong risk-to-reward strategy are more likely to achieve sustainable success.

8. Stay Emotionally Detached from Trades

Trading is a game of probabilities—sometimes, even the best setups fail. Accept losses as part of the process and move on. Letting emotions drive your decisions leads to poor risk management and bad trades. Developing a mindset that treats trading as a business rather than a game of luck is crucial. Practicing mindfulness and stress management techniques can help traders maintain emotional stability and avoid making impulsive decisions.

9. Backtest and Optimize Your Strategy

Before going live with a strategy, test it on historical data to see how it performs. Backtesting helps refine your approach and gives you confidence in your trading decisions. This process allows traders to identify strengths and weaknesses in their strategies before risking real capital. Many trading platforms offer backtesting tools that can simulate market conditions and provide performance statistics. Regular optimization of trading strategies ensures they remain effective in different market environments.

10. Take Breaks and Manage Stress

Trading can be mentally exhausting. Taking breaks prevents burnout and helps you maintain a clear mindset. Step away from the charts when needed, exercise, and ensure you’re well-rested to make the best decisions. Stress and fatigue can cloud judgment and lead to poor trading choices. Engaging in hobbies, spending time with family, and practicing relaxation techniques can contribute to a healthier trading mindset. A well-balanced lifestyle supports better decision-making and enhances overall trading performance.

Final Thoughts

Great traders aren’t born overnight; they are built through habits, discipline, and continuous improvement. Implementing these ten habits will help you become a more consistent, profitable, and confident trader over time. Stick to your plan, manage risk wisely, and never stop learning. By making these habits part of your daily trading routine, you’ll set yourself up for long-term success in the financial markets.

Best charting software: TradingView

Best Trading Journal:
Tradezella

Best Trading Scanner:
Trade IDEAS

BEST PROP FIRMS:
APEX TRADER FUNDING (ENTER BOB FOR BEST DISCOUNT)

Best Prop Firms:
MyFundedFutures (enter break for best discount)

bEST pROP firms W/ NO EVALUATION:
Tradeify

5 Ways to Actually Get Better at Trading (No Fluff)

Let’s be real—trading isn’t easy. If it were, everyone would be driving Lambos and sipping cocktails on a private island. But most traders struggle, not because they lack intelligence, but because they don’t focus on the right things.

If you’re tired of spinning your wheels and want real improvement, here are five things that will actually make a difference:

1. Stop Chasing Every Trade (Patience Pays)

One of the biggest killers of trading accounts is overtrading. You don’t need to take 50 trades a day to make money. In fact, the best traders sit on their hands more than they click their mouse.

Start treating your trades like sniper shots, not machine-gun fire. Pick your setups carefully, wait for the right confirmation, and stop forcing trades just because you’re bored.

👉 Pro Tip: If you’re trading just because “it looks like it’s moving,” you’re already in trouble. Stick to your plan or don’t trade at all.

2. Master One Strategy Before Adding More

Too many traders jump from one strategy to another every time they hit a losing streak. One day, it’s price action. The next day, it’s indicators. By Friday, they’re watching YouTube videos about some guy’s “secret trading method.”

Pick one strategy, master it, and only consider adding more once you’ve proven consistency. Otherwise, you’re just confusing yourself and setting yourself up for failure.

👉 Pro Tip: If you can’t explain your strategy in one sentence, it’s too complicated. Simplify it.

3. Treat Risk Management Like a Religion

Your number one job as a trader is not to make money—it’s to protect money. If you blow up your account, you’re out of the game. Period.

A lot of traders talk about risk management, but very few actually respect it. You should know exactly how much you’re risking per trade before you even enter. And if you’re risking more than 1-2% per trade? You’re gambling, not trading.

👉 Pro Tip: Ask yourself, “If I take 10 losses in a row, will I still be in the game?” If the answer is no, you’re risking too much.

4. Journal Everything (Seriously, Do It)

If you don’t track your trades, you have no idea what’s working and what’s not. It’s like trying to lose weight without tracking what you eat.

Write down every trade you take—entry, exit, reason for entering, emotions you felt, and what you learned. Over time, you’ll start to see patterns in your mistakes and strengths.

👉 Pro Tip: The best traders treat their journal like a playbook. Every trade is a lesson, so don’t just write numbers—write insights.

5. Control Your Emotions or the Market Will Do It for You

Let’s be honest—trading is an emotional rollercoaster. One minute you feel like a genius, the next you want to throw your laptop out the window.

The traders who win in the long run aren’t the ones who have zero emotions; they’re the ones who control them. Revenge trading, FOMO, and panic-selling will kill your account faster than a bad strategy ever will.

👉 Pro Tip: If you can’t step away from the charts without obsessing over every tick, you’re overexposed. Reduce your risk and get a life outside of trading.

Final Thoughts

Improving at trading isn’t about finding some magical strategy. It’s about discipline, patience, and risk management.The market doesn’t care how smart you are—it only rewards those who follow the rules.

So, stop looking for shortcuts, focus on the basics, and watch your trading improve.

Which of these five tips hit home for you the most? Let me know!

10 Rules Successful Day Traders Live By

Day trading can feel like a whirlwind of excitement and risk, especially if you're new to the stock market. But with the right mindset and strategies, you can navigate the ups and downs with confidence. In this guide, we’ll share 10 key rules that successful day traders swear by to help you get started on the right foot.

1. Start with a Solid Plan

Successful day traders know that planning is everything. Have a strategy in place before you even think about making a trade. Whether you're aiming to scalp small profits or swing for bigger moves, a clear plan will keep you focused and prevent impulsive decisions.

2. Use Stop-Loss Orders to Protect Your Capital

One of the golden rules of trading is to never risk more than you can afford to lose. A stop-loss order automatically sells a stock if it drops to a certain price, helping you minimize losses and protect your investments.

3. Trade with Money You Can Afford to Lose

This is crucial for new traders. Never risk money you need for bills or emergencies. Only trade with funds that won’t negatively impact your daily life if lost. This mindset helps you stay calm, even when the market takes a turn.

4. Stick to Your Risk-Reward Ratio

Risk management is key. A good rule of thumb is a risk-to-reward ratio of 1:3, meaning you're willing to risk $1 to make $3. Keeping this ratio in mind will help you evaluate potential trades more objectively and avoid emotional decisions.

5. Master Technical Analysis

Day traders rely heavily on technical analysis to make informed decisions. This involves studying price charts, patterns, and indicators to predict future market movements. Familiarize yourself with tools like moving averages, RSI, and MACD to improve your trading accuracy.

6. Avoid Overtrading

It’s tempting to get in on every stock moving up or down, but overtrading can lead to losses. Stick to your strategy and wait for the right setup. Being patient is often more rewarding than jumping in too quickly.

7. Embrace the Power of Paper Trading

Before putting real money on the line, consider paper trading — practicing with a demo account. This helps you get comfortable with the market without risking your capital. Once you’re confident, you can move on to live trading.

8. Keep Your Emotions in Check

Successful day traders know that emotions like fear and greed can cloud judgment. Always follow your plan and don’t let emotions drive your decisions. If you’re feeling frustrated or over-excited, it might be a good time to take a step back.

9. Stay Informed, But Don’t Get Overwhelmed

While it's important to keep up with market news, don’t get lost in the noise. Focus on key updates that directly affect your trades. Too much information can cause confusion and lead to poor decision-making.

10. Review and Learn from Every Trade

No matter how a trade turns out, take the time to review it. Keep a trading journal where you note down the trade setup, what went right, what went wrong, and what you can improve. This reflection helps you grow as a trader.

Bonus Tip: Stay Consistent and Be Patient

Success in day trading doesn’t happen overnight. The more consistent you are with following these rules, the better your chances of success. Over time, you’ll fine-tune your strategies and develop your unique trading style.

Day trading can be both exciting and daunting, but with the right approach, it’s possible to achieve consistent success. By following these 10 simple rules, you'll be on your way to becoming a more confident and successful trader.

Best charting software: TradingView

Best Trading Journal:
Tradezella

Best Trading Scanner:
Trade IDEAS

BEST PROP FIRMS:
APEX TRADER FUNDING (ENTER BOB FOR BEST DISCOUNT)

Best Prop Firms:
MyFundedFutures (enter break for best discount)

bEST pROP firms W/ NO EVALUATION:
Tradeify

Skip the Wait: How Tradeify Lets You Go Straight to Funded Trading

If you’ve ever dreamed of becoming a professional trader, you may have stumbled upon something called a prop firm in your research. Prop firms, short for “proprietary trading firms,” are companies that give traders the chance to trade with their capital, rather than using their own money. In exchange, traders share a portion of the profits they make. Sounds like a great opportunity, right?

But here’s the catch: Most prop firms require you to take an evaluation process first. Think of it as a test to prove you can handle their money responsibly. During this evaluation, you’ll need to show that you can meet certain profit targets without risking too much. It's a way for the firm to assess whether you're a good fit for their platform and rules.

While this evaluation process is common, it can feel like a long, challenging road for those eager to get started. That’s where Tradeify comes in, with a unique twist on how to fast-track your way to trading success.

The Traditional Prop Firm Process: A Stepping Stone to Funding

When you join a traditional prop firm, you usually have to go through the evaluation stage. This means you’re given a demo account to trade on, and your performance during this trial period determines whether you qualify for a funded account. The goal is simple: prove that you can make profits while managing risk responsibly.

This process often takes time for some, sometimes weeks or even months, and can be stressful. You’re constantly working to hit specific profit targets while avoiding drawdowns (losing too much money) to pass the evaluation.

Now, while the evaluation process can teach you discipline and strategy, it doesn’t necessarily work for everyone. Some traders simply want to skip the "test" and go straight to the real thing: actually trading with real capital.

Tradeify’s Straight-to-Funding: A Faster, Simpler Approach

Here’s where Tradeify’s Straight-to-Funding feature changes the game.

Instead of having to jump through the hoops of an evaluation, Tradeify lets you pay a one-time upfront fee to be directly funded—no evaluation required. This means you don’t have to waste time proving your skills in a demo account. You pay the upfront fee, you’re good to go!

This approach can be especially appealing for those who have experience but don’t want to deal with the long, drawn-out process of taking tests. Whether you’re a seasoned trader or just getting started, the straight-to-funding option can save you time, money, and stress. With this model, you can focus entirely on trading and earning profits, instead of jumping through hoops.

Why Tradeify’s Straight-to-Funding is Perfect for Beginners and Pros Alike

For beginners, the traditional evaluation process can be daunting. If you fail, you have to pay again and restart. A lot of people lack the patience. Tradeify’s straight-to-funding option removes that hurdle, giving you immediate access to a funded account so you can start trading and earn real money right away.

For more experienced traders, skipping the evaluation phase means you don’t have to worry about passing specific targets or dealing with restrictive rules. You pay the upfront fee, and you’re in business. This lets you focus on what you do best—trading.

The Benefits of Tradeify’s Straight-to-Funding Model

1. No Evaluation Needed – You don’t have to pass any tests to qualify for funding. This means no more demo accounts and no more waiting.

2. Faster Access to Capital – If you have the capital to pay upfront, you can start trading and earning profits right away without the delay of an evaluation.

3. Less Stress, More Focus – Without the pressure of evaluation targets, you can focus on refining your trading skills and maximizing profits.

4. A Chance to Jumpstart Your Trading Career – Whether you’re a beginner or a pro, this feature makes it easier to get into the game. You won’t waste time, and you can start trading with real money almost immediately.

Is This for You?

If you’re ready to take the plunge into the world of prop trading but don’t want to spend months proving your skills through a demo evaluation, Tradeify’s straight-to-funding feature might be the perfect solution. It allows you to go straight from zero to real trading in a much shorter timeframe. All you need is the initial upfront investment, and you’re set to start working with real capital.

No more waiting, no more evaluations, just a clear, fast path to the trading world.

Ready to get started?

It’s time to stop just dreaming about being a trader and take action. Tradeify’s straight-to-funding feature could be the shortcut you need to jumpstart your trading career. Whether you’re new to the game or an experienced trader looking for a fresh start, this option is here to make it easier for you to unlock your full potential.

Happy trading!

Common Mistakes Beginners Make When Trading with Prop Firms (And How to Avoid Them!)

So, you’re thinking about joining a prop firm. You’ve heard the benefits: no need for your own capital, access to bigger trading funds, and the chance to make some serious profits. But before you dive in, let’s talk about a few mistakes many beginners make when trading with prop firms—and how to avoid them, so you can set yourself up for success from day one.

1. Jumping In Without Enough Knowledge

Let’s be real—prop trading can sound super appealing, but it’s not a “get rich quick” type of deal. A lot of beginners get excited about the potential to trade with larger amounts of capital and rush into it without fully understanding the ins and outs of the market or the specific rules of the prop firm they’re joining.

How to avoid it:
Take the time to learn about the firm’s structure, rules, and trading strategies before getting started. Look for beginner-friendly resources that explain key concepts like risk management, trade sizing, and profit-sharing. Many prop firms offer educational content for new traders—use that to your advantage! You can also start small to get a feel for how things work before scaling up your efforts.

2. Ignoring Risk Management

When you’re trading with the firm's capital, there’s often more pressure to perform. A common mistake is to get too excited about the potential profits and throw risk management out the window. Whether it’s taking bigger trades or risking too much of your account on one position, a lack of proper risk management can quickly lead to blowing up your account.

How to avoid it:
Set clear stop-loss levels and never risk more than a small percentage of your total capital on a single trade. Stick to your trading plan, and don’t be tempted to chase big wins. Remember, consistency and preservation of your capital are key. Prop firms usually have risk parameters in place—make sure you're fully aware of these and that you follow them to avoid getting penalized or losing your account.

3. Neglecting to Practice on a Demo Account First

You wouldn’t run a marathon without training first, right? The same goes for prop trading. Some beginners dive straight into live trading with real capital without practicing first on a demo account. While demo trading won’t perfectly mirror live conditions (because there’s no real money at stake), it’s still a valuable way to test strategies and get comfortable with the platform.

How to avoid it:
Use the demo account to practice, practice, practice! Familiarize yourself with the trading platform, test out different strategies, and build up confidence in executing trades. Once you’ve consistently performed well in the demo environment, then—AND ONLY THEN—consider transitioning to live trading with real capital.

4. Overtrading Out of FOMO

The fear of missing out (FOMO) is something a lot of traders face, especially beginners. It can feel like you’re not doing enough if you’re not constantly placing trades. Prop firms typically reward traders based on their performance, which might make you feel like you need to always be active in the markets, even when you don’t have a solid opportunity.

How to avoid it:
Don’t force trades! It’s okay to sit on the sidelines when the market conditions aren’t right for you. A lack of patience can often lead to unnecessary losses. Keep in mind that being selective about your trades is just as important as making them. Focus on quality over quantity.

5. Failing to Adapt to the Firm’s Rules and Guidelines

Each prop firm has its own unique set of rules, including profit splits, drawdown limits, and minimum trading requirements. Beginners often overlook these specifics or misunderstand them, which can lead to unexpected issues down the road.

How to avoid it:
Before you start, read and understand the firm’s rules inside and out. Some prop firms have strict limits on things like maximum daily losses or trading times. Failing to adhere to these rules can result in penalties or losing access to the firm’s capital. Make sure you're crystal clear on what’s expected and take it seriously—those rules are there to protect both you and the firm.

6. Not Having a Trading Plan

Without a solid plan in place, it’s easy to get distracted or make impulsive decisions. Trading without a plan is like going on a road trip without a map—you might get somewhere, but you’re more likely to get lost or run into problems.

How to avoid it:
Before placing any trades, develop a clear trading plan that outlines your goals, strategies, risk tolerance, and the rules you’ll follow. Whether it's a simple one-page plan or a more detailed guide, having a strategy will help you stay disciplined and avoid making rash decisions that could harm your account.

7. Letting Emotions Drive Your Decisions

Trading is emotional, no doubt about it. But one of the biggest mistakes beginners make is letting their emotions—whether fear or greed—dictate their trades. If you're trading scared, you're likely to make overly cautious decisions that keep you from reaching your potential. If you're trading out of greed, you might take unnecessary risks that hurt your account.

How to avoid it:
Be aware of your emotional state before making a trade. Take breaks when you’re feeling stressed or overly excited, and stick to your trading plan. If you're feeling emotional, it’s better to step away from the screen than to make decisions that might not be in your best interest. Emotional discipline is one of the most valuable skills a trader can develop over time.

Final Thoughts

Prop trading is an exciting way to get involved in the markets without having to risk your own capital, but it’s not a free ride. By avoiding these common mistakes, you’ll be in a much better position to succeed as a prop trader. Take your time to learn, stay disciplined, and always follow your trading plan.

And remember, trading is a journey. There will be ups and downs, but with the right mindset and approach, you can work your way toward becoming a consistently profitable trader.

Recommended Prop Firms:

Apex Trader Funding: Enter BOB for best deal available

MyFundedFutures: Enter BREAK for best deal available

Recommended Prop Firm with NO evaluation:

Tradeify (Go STRAIGHT to Funded Account)

How to Find Stocks at a Discounted Value: A Practical Approach

In the world of stock investing, finding undervalued stocks—those trading below their intrinsic value—can offer a significant edge. While the concept of “buy low, sell high” is easy to grasp, identifying truly discounted stocks takes a bit more than just relying on headlines or popular opinions. The art of finding stocks at a discount lies in understanding valuation metrics, market sentiment, and the broader economic environment.

Let’s explore some proven strategies to locate these opportunities with a mix of technical and fundamental analysis.

1. Focus on Valuation Ratios: P/E, P/B, and EV/EBITDA

Valuation ratios are often the first stop when searching for stocks that might be trading below their intrinsic value. But here's the key—these metrics should be analyzed in context. A low P/E ratio doesn’t always signify a bargain, nor does a low Price-to-Book (P/B) ratio automatically indicate that the stock is cheap.

• P/E Ratio (Price-to-Earnings): Look for companies with a P/E ratio lower than their historical average, the industry average, and the market average. However, don't simply buy based on a low P/E—check if the low earnings multiple is justified by factors like weak growth or poor future prospects. An out-of-favor stock in a temporary slump may be a better bet than one with a P/E that’s low due to secular decline.

• P/B Ratio (Price-to-Book): A P/B ratio below 1.0 often suggests that the stock is undervalued, but it could also indicate that the market has serious doubts about the company’s asset quality. Assess the company's balance sheet and determine whether those low assets are tied to tangible or intangible assets (the latter is harder to value).

• EV/EBITDA (Enterprise Value/EBITDA): A solid metric for evaluating the value of a company’s operating performance, this ratio compares the value of a company, including debt, to its earnings before interest, taxes, depreciation, and amortization. A low EV/EBITDA relative to industry peers or historical benchmarks may signal that the company is undervalued.

2. Scrutinize the Company's Growth Trajectory and Competitive Position

Discounted stocks are often linked to temporary setbacks—whether due to a sector-wide downturn, a shift in management, or external market shocks. If a company’s fundamentals remain strong despite short-term challenges, its stock might be unfairly discounted.

• Earnings Growth Rate: Review the company’s earnings growth over the past 5–10 years. A stock might be undervalued if earnings have been consistently growing, yet the price has fallen due to market pessimism or overreaction to a bad quarter.

• Competitive Advantage (Moat): Evaluate whether the company has a sustainable competitive advantage. Companies with strong moats—such as brand loyalty, patent portfolios, network effects, or cost advantages—tend to recover faster from temporary setbacks and often have less volatile earnings. A company with a wide moat trading at a discount could be an opportunity.

3. Examine Insider Activity and Institutional Ownership

Insider buying and large institutional ownership can be strong indicators of a stock’s long-term prospects. If executives or major shareholders are increasing their holdings, this could be a sign that the stock is undervalued, especially if they’re doing so in a market downturn.

• Insider Buying: Pay attention to large insider purchases, particularly from key management members. Their buying behavior could indicate that they believe the stock is undervalued or that they expect a rebound. Conversely, insider selling, particularly if excessive, could signal the opposite.

• Institutional Ownership: A high level of institutional ownership can indicate confidence in the stock’s long-term prospects. When institutions start trimming their positions, however, it’s worth investigating the reasons behind it—if those reasons are related to short-term market events rather than company fundamentals, the stock might still represent a bargain.

4. Look for Stocks with a Catalyst for Change

A stock trading at a discount due to temporary headwinds or market mispricing is often a hidden gem, but the real value lies in finding catalysts that can unlock that value.

• Turnarounds: Companies that are in the midst of a restructuring or turnaround can often be bought at deep discounts. However, this requires a lot of due diligence. Are the management changes and strategy shifts truly likely to result in better performance? Understand the company’s restructuring plan and whether it’s likely to deliver lasting benefits.

• Mergers and Acquisitions (M&A): If a company is being undervalued due to being an acquisition target, this could represent a great opportunity, especially if the market has priced it too low. Be cautious of hostile takeover situations, but research potential acquirers and assess the likelihood of a deal happening.

• Sector Rotation: Certain sectors go in and out of favor. For example, if a sector like energy or financials is underperforming but you believe it’s due for a rebound, that sector could present discounted opportunities. Historical analysis can help determine which sectors tend to recover post-drawdown.

5. Utilize Quantitative Screens and Algorithmic Tools

A more systematic approach involves using quantitative screens and financial models to identify potentially undervalued stocks. Platforms like Bloomberg, FactSet, and even free tools like Yahoo Finance and Finviz can help filter stocks based on specific valuation criteria.

• Discounted Cash Flow (DCF) Models: For a more precise understanding of a stock’s intrinsic value, consider running a DCF model. This involves estimating the company's future cash flows and discounting them back to the present using an appropriate discount rate. If the current market price is significantly lower than the DCF value, it may indicate that the stock is undervalued. Just be sure to use conservative growth assumptions to avoid overestimating future cash flows.

• Relative Strength Indicator (RSI): While more commonly used as a momentum indicator, RSI can also signal when a stock is oversold. A low RSI (below 30) can indicate a stock that’s temporarily undervalued from a technical perspective, potentially signaling a buying opportunity if the company’s fundamentals are solid.

6. Watch for Market Overreactions and Psychological Biases

Markets often overreact to news—whether positive or negative—and this presents opportunities. Understanding psychological biases like loss aversion (investors’ tendency to avoid realizing losses) or herding behavior (where investors follow the crowd) can help you spot stocks that are undervalued due to irrational market behavior.

• Negative News Overreaction: When negative news hits a company, such as a regulatory investigation, earnings miss, or a lawsuit, there’s often a knee-jerk reaction that drives the stock price down, sometimes to a level that significantly underestimates the long-term impact. As an analyst, you need to carefully assess the severity of the news and whether it genuinely changes the company’s prospects.

• Fear and Greed Cycles: In bear markets or during broader economic uncertainties, fear drives stock prices down. While this can create opportunities, be mindful that some companies may never recover or could be fundamentally impaired by changes in the macroeconomic environment.

7. The Technical Aspect: Using Charts to Identify Discounted Stocks

While fundamentals are crucial in identifying undervalued stocks, technical analysis can provide additional insights into market sentiment and price action. A technical approach involves studying price charts, volume, and trends to understand how a stock is behaving in the market.

• Support and Resistance Levels: These are key price levels that a stock has struggled to move past. A stock that is trading near a major support level and showing signs of stabilization might be undervalued, particularly if there is an increasing volume of buying interest. If the stock rebounds from support, it may indicate the market has overcorrected, offering a potential discount.

• Moving Averages (MA): Short-term and long-term moving averages can give you an idea of the stock's trend direction. For example, if a stock is trading below its 200-day moving average but is starting to trend upward toward this level, it could suggest that the stock is at a discount and may soon recover. A moving average crossover, such as the 50-day MA crossing above the 200-day MA (a "Golden Cross"), is often a bullish signal.

• MACD (Moving Average Convergence Divergence): The MACD is a momentum oscillator that helps identify changes in the strength, direction, and momentum of a stock’s price trend. When the MACD crosses above its signal line, it can indicate an upward momentum shift, even if the stock is still trading at a discount. Similarly, an overbought MACD condition might warn you that the stock's value is no longer a bargain.

• Volume Analysis: A stock with low volume might be undervalued because it’s not attracting much attention from investors. However, a sudden increase in volume, particularly following a price dip, could signal that institutional buyers are beginning to accumulate the stock at a discounted price. Volume spikes often precede significant price moves, either up or down, so keeping an eye on volume changes is critical.

• Relative Strength (RS): The Relative Strength Index (RSI) is not just useful for finding oversold conditions; you can also use it to compare two stocks or sectors. If a stock is consistently outperforming its peers but is still trading at a low valuation compared to industry benchmarks, it might suggest that the stock is undervalued relative to its technical strength.

Conclusion: Patience and Diligence Are Key

Identifying undervalued stocks at a discount is more of an art than a science. It requires a blend of financial metrics, qualitative assessment, and an understanding of broader market dynamics. What often sets the most successful investors apart is their patience—waiting for the right moment when the market irrationally prices stocks below their intrinsic value.

By focusing on valuation metrics, understanding the company's fundamentals, tracking insider activity, identifying catalysts, and using quantitative tools, you can gain an edge in finding stocks at discounted values. On top of that, employing technical analysis can provide additional insights into market sentiment and help pinpoint entry points when a stock reaches its discount threshold. However, remember that no strategy is foolproof—always do your due diligence and have a well-thought-out risk management strategy in place.

Best charting software: TradingView

Best Trading Journal:
Tradezella

Best Trading Scanner:
Trade IDEAS

BEST PROP FIRMS:
APEX TRADER FUNDING (ENTER BOB FOR BEST DISCOUNT)

Best Prop Firms:
MyFundedFutures (enter break for best discount)

bEST pROP firms W/ NO EVALUATION:
Tradeify