“In order to be a successful financial market trading professional, you need to have the capability to adhere to strategies or rules. If you start trading with the intention to break these rules, you instantly set yourself up for failure.” These are the words of one of the top senior financial analysts at Olsson Capital, Mark Hampton. To help new traders find their feet in the volatile world of financial markets, Hampton has compiled a set of strategies and rules one should adhere to when wanting to make a success of one’s trading ventures.

The use of a trading plan

If you want to be a successful financial market trader, you need to trade according to a plan. You need to determine what amount of risk you are willing to take, what your enter and exit strategies will be as well as where you should set your stop-loss. However, in order for your trading plan to stay successful, you need to backtest your plan, evaluate what changes you can make and adjust your plan according to your findings.

Treating your trading venture like a business

If you are a trader, you can be considered as a small business owner. Like any business, trading takes risk, frustration, losses, profit gain, changes and learning curves. Starting your trading business can be expensive, thus it requires your full attention. Some individuals are seen as casual traders and treat the concept of trading as a hobby. For successful trading, you need to step up your game and make it your full-time business venture.

Protection for your trading capital

Putting your money in a savings account is easy. Withdrawing it to use for trading is easy. The difficult part is not taking advantage of the money you have saved. You need to incorporate a strong sense of discipline when it comes to the capital saved up for trading purposes. Withdrawing cash whenever you need or want something won’t set you up for success; it will set you up for failure.

Financial market trading education

If you want to be a successful financial market trader, you need to keep educating yourself. A trader can and should never stop educating him or herself; even when profits come rolling in. It is important to know that factors such as politics, the economy and even the weather can have an impact on market fluctuation. You need to be educated about how trading was done in the past, how it is currently done and what the future holds for trading in order to truly make a lifelong success of your trading business.

Know that what you gain, you can lose

Once you have enough capital to start trading financial markets, you need to keep in mind that you can lose almost all the capital if your trading plan does not work. Having said that, you should only trade with the capital you can afford to lose. For the rookie trader, this may sound scary but with good risk management and setting stop losses for all trades you make, your trading capital is safe.

Separate fact from fiction

It is easy to fall victim with get-rich-quick platforms on the internet. A great way of separating legit trading platforms from the rest is taking the “if it looks too good to be true, it is too good to be true” train of thought. Make sure you trade with a legit brokerage firm that is willing to show you the ropes without keeping aspects of their trading purposes a secret from you.

Know when it is time to stop trading

If you are on a winning streak, emotions can often cause huge losses. The pure adrenaline of making a profitable trade can lead a trader to leave the confines of his or her trading plan behind and trade with emotions. This, in the trading world, should never be done if you truly want to be a successful financial market trader.

The above-mentioned strategies and rules of trading, combined, can make you a successor in the financial market world. As a financial market trader, this is what you should strive for to achieve lifelong profit.

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