Six tips for new betting exchange traders…
If you are brand new or you’ve been around a few months, you probably have noticed it can be quite confusing as to where you should focus your attention when starting out trading.
Here’s a snappy post with 6 points that everybody should consider before parting with their hard earned cash.
Go Long-term:
Oh no, I said it…
It’s the one thing that everybody doesn’t really want to hear. But in order to succeed, it’s advisable that you start out taking a longer-term view.
Of course, everybody’s looking for the next get-rich-quick scheme, but if you take a look at anything in life those who’ve amassed great wealth often took a longer-term view.
Trading is no different particularly when you consider most new trader’s downfall is patience. The exchange markets are different to financial, of course. However, the same saying that Warren Buffet once said rings true:
The stock market is a wonderfully efficient mechanism for transferring wealth from the impatient to the patient.
Having a both emotional and irrational approach to the markets is likely to lead to over-trading. I’ll tell you now, it’s the quick way to the poorhouse. Don’t do it. You’re just lining someone else’s pockets…
Realistic Expectations:
Following on from the first point, it’s not unnatural to look around at maybe myself and others and see that they’ve done extremely well for themselves. Of course, this is too, possible, but in the early days, you need to be realistic. Optimism is great; But, misplaced optimism is foolish.
In most cases, successful trading comes from hours and hours of reading, learning and logical application within the markets. That’s not to say that you couldn’t make a lot of money very quickly. Although the reality is, it’s probably going to take a while.
Also, consider the difference in your behaviour when you do and don’t have expectations. If you do have great expectations, it’s quite likely that you’ll feel worse when they’re not met.
If you don’t have those expectations, failing your way to success becomes significantly easier…
Detailed Research:
Again, boring.
But it’s an absolute must if you’re to succeed in this trading game. You’re not the only one that’s trying to extract thousands of pounds from the markets. In order to beat your other opponents, it’s best to have an edge or significant advantage of one kind or another.
The most logical come through understanding. The more characteristics and limitations that you understand from each situation will put you ahead of the pack. Make notes, spot patterns and do your very best to understand exactly what’s going on.
Limit Weaknesses:
Throughout life, most people want to be the best at everything. It’s just human nature.
However, it doesn’t make a whole lot of sense because if you can focus on one specific area, the chances of success increase drastically. Trading is exactly the same – except you have to remember there’s financial gain or potential loss linked with what you’re doing.
The quickest route to success would have to be to eradicate all weaknesses. Focus on the bright spots and do what you know that you are passionate and good at. Only once that’s mastered is it time to then move on to other areas. The chances are the things you learn from your successes will be easier to carry over afterwards.
Emotion Intelligence:
You’ll find talk of this riddled all over the place: on trading forums and even this very blog. But if you can’t control your own emotions whilst in the moment trading, you’re screwed. That’s it. Game over.
So, with that in mind, what framework and structure are you going to implement into your immediate environment and trading game in order to protect yourself from potential losses? And more to the point, how are you going to maximise your potential upside whilst considering emotion, inside the markets. Honestly, think about it. You’re not the only one that reacts emotionally at times!
Emotion presents an opportunity as well as a potential risk.
Best Tools:
Much like I mentioned in previous points, there’s a huge array of people out there that are trying to beat you while betting on the exchanges. They want your money just as much if not more than you do theirs. So it only makes sense to equip yourself with the best possible tools to succeed.
It depends entirely on what you are trading. However, if you are trading pre-race horse markets, it’s non-negotiable; it’s an absolute must. Probably even more so for in-play traders.
The exception to this would have to be very long-term trading, maybe if you’re trading over a set of days or weeks, or even over a series of sets within a tennis match.
Trading software will definitely provide you with an advantage at times.
Related: NEW Cricket Trading Strategies!