While investing in a business may seem like a safer course of action, those with a bit of money on the side might find it more lucrative to try their hand in online trading. It can be done efficiently even as a part-time job. Nonetheless, in order to actually make some profit, you will have to master several aspects of Forex trade, like setting a trading strategy, determining stop-points and much more. With this in mind and without further ado, here are four online trading strategies for a beginner.
1. Pick a Trading Strategy
The first thing you need to keep in mind is that in order to get the most out of your trading, you need to pick a strategy. If we were to describe how these strategies work in the simplest possible terms, we would say that you are either betting on or against a certain trend. Still, there are many different ways to do so and some of your options are trend trading, swing trading, momentum trading, retracement and many other strategies. You can consult Synergy FX, an Australian regulated forex broker, regarding their online Forex trading services.
One more thing you need to keep in mind is that in order for a certain strategy to give some results, you need to persist in it for at least a full year. Changing your strategy on a monthly basis might seem compelling but keep in mind that this is more of a gamble than actually doing business.
2. Set a Stop-loss and Profit
Another thing you need to learn about online trading is how to cut your losses and when to quit while you’re still ahead. While there is no general rule, it would be wise to set a stop-loss order at about 1 or 2 percent of your entire asset value. As for your win-stop, you should set it at 6 or even 7 percent. In this way, you can make a profit even with only 30 percent of successful trades, which puts you in a great long-term position. Keep in mind that trading is not a race but a marathon, which is why you should always be concerned with a bigger picture.
3. Find the Right Platform
The next vital thing for an inexperienced Forex trader is to find an appropriate platform. In the 21st century, you can control all your trades through a phone at your day-job or on a laptop during a holiday. The choice of the device makes no difference in 2017, but the choice of a platform does. What you need is a social trading tool, that gives you advanced options like auto trade, copy trading and much more.
4. Take It Easy
One of the things that even the best trading course or tutorial cannot provide you with is a genuine experience in this industry. Therefore, until you are confident enough, it might be for the best to just play it safe. Start by making a couple of token trades here and there in order to see how things work, and then try taking some bolder steps. Keep in mind, though, that demo trading isn’t like real trading and that you might need some time to adjust.
As time goes by, you might find yourself earning enough money that you can focus on Forex trading as a full-time job. At that point, you might be ready to start exploiting the most advanced strategies and features, as well as justify spending a fortune on adequate hardware. Until then, you need to provide yourself with an environment in which you can safely practice some of these basic skills.