Cfd trading tips to keep in mind

VINSON FINANCIALS PRESENTS

CFD TRADING TIPS TO KEEP IN MIND

CFD trading has emerged as a popular alternative for traditional form of trading.

Without actually having the ownership of the financial products, all you do in CFD online trading is take a position on the price of the product, speculating whether the price will rise or fall. The best CFD platform will provide you with a wide range of financial instruments for CFD trading, such as forex, commodities, indices, etc. Your CFD trading broker will only demand of you a small margin amount upfront in order to trade using his CFD platform.

But remember, while the profits with this form of trading can be huge so can the losses be. Keep the below tips in mind when you’re trading CFD for a living:

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1. START WITH TRADING SMALL AMOUNTS

2. BE CAREFUL ABOUT YOUR PROFIT/LOSS

Start with trading small amounts, especially when

There will come a time when you’ll have to face

you have little experience in this type of trading. The

losing trades. In such a situation, you should be

thing about trading with margin is that your losses

rational and step away from the trade in order to cut

can way surpass your initial deposit. So keep the

your losses before they run too extreme. Similarly,

trading small and easily manageable when starting

you should also be careful not to take your profits

out, and only when you’ve earned some substantial

from a profitable trade way too soon, there is a

experience, think about going big.

chance that if you let your profits keep running they yield better results.

3. DECIDE THE PRICE LEVELS

4. DON’T BE IMPULSIVE

With CFD online trading, your first step should be to

Don’t be impulsive with your CFD trading. Foe

decide the price levels at which you want to enter

example, you shouldn’t trade against the current

and exit the trade. Try to stick to this plan of buying

trending price positions, without concrete evidence

and selling the financial instrument when its price

that the trend is likely to reverse or change in the

reaches those levels. For exit points, you should keep

future. Your trading decisions should always be

two price levels decided, one for when you’re

based on logic and evidence, rather than random

incurring losses and one for when you’re reaping in

instincts.

profits.

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5. USE FUNDAMENTAL & TECHNICAL ANALYSIS

6. MAINTAIN AN EXCLUSIVE NOTEBOOK

Use a combination to make sound trading decisions.

Keep logs of your CFD trades. Make detailed notes of

You can use fundamental analysis to decide the

your trades, such as what financial instrument you

trigger point of your trade and use technical analysis

traded, when did you enter and exit the trade, what

to decide the entry time into the trade. Your CFD

were your reasons for doing so, did the trade result

online trading platform may offer you various

in profit or loss, etc. Such a notebook will be a useful

analysis tools that you can make use of.

tool in your learning from the past trades.

Contact us: (+357) 25 02 88 61–63 | general@vinsonfinancials.com