I tried paper trading and I can’t… Paper trading has never worked for me, I need to win or lose really money to understand better… Sounds stupid, I know but when I lose a fair amount, I don’t want to do the mistake again!
Ideally, I need to find a few shares and/or indices on which I could enter a trade in the morning and let it run until it hit the stop or the limit OR shares/indices that I could trade in the evening or early morning (before/after work). Just need to find the share and research the technical analysis behind it to decide when to enter… and ideally, that would allow me to make to 10-50 points per day…I may be asking too much for now!
My other advice is not to follow discussion forums too closely. Most try to appear as know it all and most are relentlessly bearish. I suspect some work for the spread betting companies. If you need to know what is happening in the markets minute by minute then watch CNBC but take everything with a pinch of salt as what the media shows is what they want you to know!
Here’s a few extra spread betting tips and strategies to improve your chances of success -:
- Read a few good trading books such as “Trading in the Zone” and “Come into my Trading Room.
- Always watch interest rates and price/earnings ratios. Low interest rates and low price/earnings ratios equals bull markets.
- Don’t over leverage.
- Don’t trade currencies. I consider currencies to be a lottery. The national lottery is very popular. Currency trading is very popular. It appeals to a particular mindset. IMO it’s a harder game to win at than equiities.
- Don’t overtrade. The most common problem is overtrading, reinvesting your profits to soon after a win without any clear direction set out.
- Or worse of course going back in instantly to reclaim your losses, and doubling them instead, that must be quite bad if anyone has ever done that as unlikely as it may sound.
It is very important not to be too clear when trading the markets. I see so many newbie investors doing what Cramer is recommending and following what fund managers are recommending is buy. Intellectually you can make lots of arguments as to why shares should fall but if most people (unaware/ignoring those arguments) think they will go up then most people are buyers and prices will rise.
I have come to the conclusion that preserving cash is a better strategy than attempting to trade in a market that is beyond me. The only frustration is that whilst doing nothing doesn’t create losses, it also doesn’t create any profit.