Top 5 Characteristics of a successful trader -


Post Top Ad

Post Top Ad

Tuesday, 6 March 2018

Top 5 Characteristics of a successful trader

Do you want to know some alternatives to invest your money? Today, our guest author IG, a company that offers to operate with CFD in various financial markets, will talk about online trading and the skills that a trader needs to fully benefit from the operations he executes. Find out, invest today is not rich!

Online trading is fashionable, of that there is no doubt. More and more people are entering this world, either looking for timely income or the point of fun they miss in their daily lives.

After all, the massive arrival of the Internet in our lives for a few decades has greatly democratized the world of financial investment .

If before there were only a few economic elites that could invest in the stock market, in the currency market or on the price of raw materials, now anyone can do it.

Of course, not everyone can get to operate with real money in online trading platforms. It requires a minimum knowledge , psychological preparation and, above all, to be very clear about certain basic concepts before entering to move money within this world.

Then, in case you want to join this world and try to make a profit through operations in different financial markets, we explain the five basic characteristics of a good trader.

Follow them step by step and, although you may not make sure you become the new Warren Buffett , but you will have more chances to get positive results in your operations or, at least, not lose all your money in the blink of an eye.

1. Surround yourself with the best in the industry

This is the first essential step if you want to be successful in the world of online investment . Nobody is so clever -not as rich- as to become a millionaire on their own in online trading, and for that reason a trader who aspires to earn money must join brands established in the market, with a certain reputation. Especially when it comes to choosing a broker .

A broker or investment broker is the platform through which traders make our investments in different markets. They offer different prices for each instrument and we decide whether to buy it or not.

Regarding the choice of one of these brokers , it will always compensate much closer to platforms that, although they are a little more expensive or have a more complex and demanding start-up process, offer all the guarantees of being operating with a reputed actor . Sometimes, it happens that the traders began to operate with the cheapest brokers and ended up being a scam.

The same applies to any other type of company, agency or self-employed person that is going to be instrumental for our investments or that supposes a help for our actions.

The key is always to go to actors who have a certain reputation and who already have a name and a positive reputation in the industry.

We must always stay away from the cheapest options , since behind these low prices there is usually a very important reduction in quality.

On numerous occasions, we can see incredible offers to operate on unsafe markets such as cryptocurrency in exchange for ridiculous prices.

Do not pay attention, try to have only signatures and workers who, although more expensive, have the greatest certainty that they will not fail you in any way.

2. Be patient, haste never helps

No one is born learned. Although it is a phrase made, this is a very important truth, especially in the world of online trading.

As a novice investor you should take your time to acclimatize to the environment , know the different types of markets, the possibilities they offer you and the behavior of the different instruments in each of these markets.

So, for example, one of the most common recommendations for a novice trader are usually demo accounts .

Most reputable brokers have this type of accounts, in which they operate with fictitious money instead of real money. Its purpose is to make the trader get used to the operation of the markets and everything that has to do with trading: price movements, use of strategies, identification of patterns in the ups or downs of value, etc.

No matter how much time you have to spend operating in a demo account, the important thing is that when you decide to make the leap to the accounts in which you operate with real money, you have enough notions to not lose your capital in a couple of wrong movements .

In addition, patience should not apply only when you are a novice without much idea of ​​how financial markets work, but you have to maintain it until the last second of our life as a trader.

The rush is always bad advice, and it is useless to close operations early or want to get rich in four or five operations . You can be completely sure that if you try to get rich in a few risky operations:

  •     You will end up bankrupt and without money, since the only way to get stable and constant income is through a conscientious trading, and not crazy.
  •     You will be frustrated , since you will think that you do not have 'what you have to have' to succeed in the world of online trading. 

For all this, you know, do an exercise in patience and get ready to put your nerves to the test. This online trading is like the world of snipers, only the one who waits the most and the one with nerves of steel wins.

3. Discipline, the key to the industry

Patience is tremendously important in online investment, but we must also recognize that discipline is no less important. And is that a good trader has a great control over himself , both financially, emotionally or work.

For example, almost the most important part to invest online is to have a total discipline in terms of our economic organization.

A real trader only operates with the money he has been able to save for this purpose out of the money he needs for his life and daily expenses.

And the moment that any person begins to pull your savings or daily expenses to invest that money in the financial markets, this means your ruin will end up coming. Sooner or later, but surely it ends up coming.

Not mixing the money that is dedicated to trading with that of daily life is the main maxim in the life of a financial investor.

Then, as we explained earlier in the point of patience, it also requires enormous discipline and control over oneself. 

For example, let's put a usual situation: we have a financial instrument (the shares of a company) that costs about 30 euros, but its price is falling below normal, and it seems that it will continue to plummet.

Here, the responsible decision is to sell while the asset still has an acceptable value and by which we can get something out. However, if we wait too long, thinking of a lack of discipline that perhaps the price rises again, we may be facing a total loss of the value of the instrument and, therefore, we are left with nothing.

Therefore, although it costs us, we have to have enough discipline to sell the instrument at the right time, accepting the losses it generates, instead of trying to turn the situation around and end up with nothing.

So, it is also important not to get carried away by any kind of hunch, intuition or irrational thinking. The key to success in trading is rationality and discipline. 

Leaving your field you may be lucky one day, two or even three; but what is clear is that sooner or later you will lose all the money earned through luck. Without method (and without discipline) there is no paradise in online trading.

4. Adapt or die

In financial markets open to online trading there is a huge diversity of subjects to operate on, as well as ways to do it. And, obviously, it is not the same to invest in currencies of the Forex market or currencies than in future contracts on commodities such as crude oil or gold.

Therefore, a good trader must know how to adapt to each of them , applying different methods to each of the spaces.

Then, we give you a definition of each of the markets in which you will have the opportunity to dive into online trading:

Forex or Forex market

The Forex (Foreign Exchange Market) is the economic space where foreign currency is exchanged for others.

In other words, all the world's currencies (the US dollar, the euro, the Mexican peso, the pound sterling, etc.) are bought and sold . The prices of each of these currencies are configured based on supply and demand, and the objective of investors is to buy a currency before its value rises, thus generating a profit.

For an initiatory investor, it is best to start operating in these markets with derivative products such as CFDs (Contracts for Difference).

With these products, one can enter to operate on the currencies without having to make an initial outlay of very large money. With CFDs, instead of buying a product, you will only gain exposure to the price changes that are made in it during a certain time. 

Raw Materials

Another one of the markets with more attraction for the new investors is the one of raw materials , in which it is possible to be operated on a great number of raw materials.

As in the case of the foreign exchange market, the raw materials market is defined by supply and demand. Although, in this case, the most used product to invest are the Futures Contracts.

Within the raw materials, gold, oil, or natural gas are some of the products in which most is invested, although their characteristics are totally different.

While gold is a safe haven - investors go to it to keep the value of their money, since gold is never devalued - oil is much more volatile, and better adapted to riskier operations . 

The cryptocurrencies

Bitcoin , Litecoin, Ethereum and the rest of electronic currencies are some of the most volatile financial products in the world.

What does this mean? That its price undergoes constant changes in its value and that these changes can be up to 20% or 30% in a single day.

In fact, the operation of the cryptocurrency market is very similar to that of Forex, and, also in this case, CFDs are the product that best suits this economic space.

However, the enormous volatility of the cryptocurrency market means that although it is very easy to make large amounts of money in just a few hours if you are able to take the right trend, it is also extremely easy to lose large amounts of money if you are not paying attention. Therefore, it is a market that requires extreme attention. 

5. Always follow a strategy

As an important last step, you should always keep in mind that the basis of your entire trading system should be a well-planned strategy.

And your behavior against this strategy must combine the four concepts outlined above: patience to make it work, discipline not to get out of the rules you have marked, which suits each of the market types in which you are going to invest and, very important, that has the analysis or tools of reputable companies in the trading industry.

If your strategy is correct from the analytical point of view and, at the same time, you apply the four steps that we have explained previously, your trading is ready to operate without problems in the real financial markets.

You can lose or earn more money, but at least you will fulfill all the requirements to not lose all your money due to unconsciousness or ignorance. 

No comments:

Post a Comment

Post Top Ad