Being a professional trader may be more appealing than taking on another job at night. Though financial markets are constantly changing, it can be challenging to adhere to the ever-changing market patterns. How is it possible to be a successful trader while working a day job? Here are some tips and tricks for managing your side job as a trader and preventing some of the mistakes others make.
1. Choose a trading style that suits you
To succeed as a CFD broker, you will need to find a trading style that works for both you and your schedule. A trader can choose between swing trading and day trading, while swing trading is better suited to workaholics who lack time to monitor the market during working hours. They do not always have to monitor the charts, but they can analyze the charts over the weekend or off work and execute the trades during free time.
On the other hand, Forex traders typically prefer day trading since they can usually find active currency markets at any given moment. You can still trade at certain points of the day as long as you squeeze in a few minutes.
Adjust your schedule after choosing your trading style to execute the trades on time by carefully choosing the markets, brokers, and instruments.
2. Try a demo account first
Start your CFD trading journey with a demo account offered by most online brokers before you begin trading on a live account. It is the best way to test out CFD trading tips before committing real money. Your performance and returns will be more realistic. Could you set aside $1,000 to trade CFDs? Add this as a virtual amount to your demo account if you want to test it.
3. Stop overtrading
Lack of a trading plan is one of the common mistakes traders make. Whenever you execute a trade without planning, you’re almost certain to lose money. Follow your plan when it comes to charting and trading. Set your rules and analyze the charts rather than responding to the market based on what you feel. You will soon get the ideal price. As such, you should enable your real-time notifications so that you can be notified of any market changes after your weekend analysis is complete.
4. Limit leverage
Leverage is an option, but keep in mind that in most cases, it is unlikely that the price will move instantly in the desired direction once a position is opened. With very high leverage, a small move (say 0.1% in the wrong direction) can force you to close out the position, and you will not profit when the price reverses. The use of leverage levels of more than 400:1 is not uncommon, but regulators in the EU have set a 30-to-1 maximum limit on major currency pairs.
5. Avoid being influenced by money
It is important not to focus on how much you earn and how long it will take you to leave your job forever. You will be tempted into unhealthy trading habits if you focus on the monetary side of things. Demotivation can also result from your realization of how far you still have to go. Make baby steps instead and focus on the present to immediate tasks that need to be done and avoid snowballing the list. As your improvements grow, start taking measures.