Here are three top CFD trading strategies that will improve your trading
- Run your profits
- Cut your losses
- Don’t over trade
What does running your profits mean?
Basically most CFD traders get it right about 50% of the time. When you are buying or selling something with a CFD you are essentially taking a speculative position on one of two outcomes. Will it either go up or down.
With some basic technical analysis you can tell whether a stock or asset is in an up or down trend. But it’s what you do after that counts.
Some clients are too eager to take a profit and lock in a few points rather than having patient and running a profitable position.
Never run your losses
Inversely, one of the major mistakes most people make in CFD trading is running losses too long. If a trade is bad cut it. Don’t bury your head in the sand and wait for it to get better.
Why over trading is so bad.
Over trading CFDs can either mean trading too much or putting to much of your risk capital (account balance) at stake.
You should only assign a small percentage of your investment portfolio to CFD trading, never put all your eggs in one basket and only really trade if you see an opportunity, not just for the sake of it.
You may also find these articles interesting:
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- CFD (Contracts for Difference) trading meaning
- The best way to compare CFD trading platforms
- Top CFD trading strategies highlighted
- CFD trading tips and where to find them
- Where to find a CFD stock broker and what to avoid
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