Trading: It’s The Process, Not The Outcome

Description: Online trading is available to everyone, but it’s not for everyone. Success depends on commitment and more importantly, on the process of trading itself.

Trading: why your focus should be on the process

Online trading offers you a slew of opportunities and possibilities that not too long ago would not have been available. The extent to which this industry has grown is such that nowadays daily trades average around $5 trillion. However, trading in various financial instruments is not for the faint of heart. You need to understand that if you’re going to enter this volatile world, that not only can your profits be great, but so can your losses. You’ll need to develop a keen understanding of the markets and a thirst for knowledge on politics and global events. In other worlds, trading isn’t just about predicting where a currency or commodity might be within a specific set of parameters, it’s about the process – what it takes to make accurate estimations and how to get there.  In fact, if you’re looking to get into trading, you should take it as seriously as you would an actual business.

Treat it like a business

In order to reap the potential benefits of online trading, you need to treat it as a full-time business or at least a part-time business. Refrain from looking at it like a job or a hobby. If it’s viewed in light of being a hobby, then your commitment to it is likely to be inconsistent. If you view it as you would a 9 to 5, then you’re likely to become frustrated over the lack of a regular paycheck.  Like a business, trading is subject to taxes, expenses, losses, profits, uncertainty, risk and stress. With all the hallmarks of a business, it’s only fair that you treat it accordingly.  Thus, as a trader, and in essence, a small business owner, you will need to invest hours into research and strategizing.

Research & strategy

Trading is a global affair reliant on global solutions and global outcomes, hence your research has to extend into the world at large. The currencies of the world are subject to the state of their countries and the economic intermingling that occurs between these countries.  For instance, if you’re speculating on a currency pair, you’ll want to investigate the economic activities of both countries and this can entail looking at the political arena of each as well as any major foreign investment endeavours. It would also be a good idea to look at legacy issues – how old is the country in question’s stock market? What major companies and corporations have emerged from each country to dominate the market on a global scale? The latest updates from CityIndex, one of many reputable online brokers, could be of great assistance in the pursuit of such knowledge.  Their free demo accounts have helped many new traders to become acclimatised. Next would be a strategy. If you’re going to be risking your money, you’ll want it to be as calculated as possible. It would be advisable to develop a serious liking for flow charts and financial media outlets.  Rest assured, if you follow all this advice with fervour, you may very well develop a passion for the type of information at your disposal. Thanks to the ongoing evolvement of financial technology, there are various software implements that you can use to make better estimations. Various online brokers avail upgrades on trading software at a very decent costs while there are companies that make automation software (trading robots) designed to take into account a slew of variables based on your research and to then initiate trades on your behalf.  Remember would-be trader, at the end of the day, it’s the process, and the process is also the journey.