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Trading News Another 3 Spread Betting Rules for the Novice
Trading News Another 3 Spread Betting Rules for the Novice
Another 3 Spread Betting Rules for the Novice |
| Written by Trader Hideout Editor | |||
| Wednesday, 17 December 2008 11:20 | |||
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In an earlier article titled ‘Top 3 Spread Betting Rules for the Novice’, we gave three short rules to get the novice started, however, it just didn’t seem enough so here are another three spread betting rules that the novice should live by. Rule Number Four: Watch the pennies In Rule Number Two, we advised you to start small, however, you also have to manage your money bank. Many expert and successful spread traders do not risk more than 2 percent of their bank on a single trade. Use the stop-loss appropriately so that your trade will be closed automatically if you lose that 2 percent. That might not sound great when you’re starting off small but if you don’t follow this rule, you may never make it big. Rule Number Five: Specialise As we mentioned in Rule Number Three, spread trading is a skill that can be learned. So, try to get to know one or two markets really well and do not be tempted to play the field in areas you do not know. Experts say that each market has its own rhythm and certainly the big winners in this field do not play at random – they trade only on oil, or gold, or specific stocks and shares, but they never trade at random. Rule Number Six: Cut your losses but not your profits Beginners are often said to ‘run their losses and cut their profits’ and that’s what this rule is all about. If you see the prices dropping, do not be tempted into the thought-trap of ‘the price is bound to recover’. More often than not, it doesn’t and you will only lose more money. On the plus side, do not panic if you see a profit either. If you’ve made £200, it’s tempting to grab the money and then watch as a few minutes later you would have made £250, then £300. Having said that, you will not go broke if you take a profit so it’s a judgment call and if you follow Rule Number Five, you’ll be better placed to make that call.
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