Trading Psychology

“The enemy is not the market, or your broker, or even the other traders out there. It’s you.”

Fear, Greed and Need

Your emotions play a key role to your success, in learning to try to earn a good second income by trading the markets. If you let them run rampant, the ‘triplets’ within you, fear, greed and need, will be your nemesis in this business. They will eat away at your trading account like a cancer until there is nothing left.

The fear of loss, the desire to maximize your profits and the need to feed your ego with success, are within us all. You, however, do have a choice. To either kennel them and keep them on a short leash or let them drag you from one end of your account to the other.

Does that sound too dramatic?

Well not to the vast majority of ‘wannabe’ traders after they fail (including myself once upon a time). Most learn the lesson long after they have missed the chance of a comeback. Consider yourself forewarned.

In this article I am trying to offer you some of my insight and knowledge that I have learnt over many years of trading. Quite simply, trading is a bit like flying, in that it is a whole lot easier to take off than it is to land. Also when trading, it is a whole lot easier to recognise when to enter a trade than it is to recognise the appropriate exit for you!

3 Three Biggest Key Mistakes

The three biggest mistakes you can probably make are:

• Entering a trade too early or too late;
• Exiting a trade too early or too late; and
• Trading far too often.

Here is a sobering thought. The average novice trader burns through his or her account very quickly. It is not that they are uneducated or stupid. It is that they either do not have, or choose not to follow, a trading plan or strategy. Remember, plan your trade, trade your plan.

One of the first things I encourage people to do is set up a personal trading plan. We are all different so I do not offer a ‘canned’ plan like some ‘training’ organisations do.


By Dominic Nardone, a professional trader. Please note that the views of Mr Nardone are his exclusive responsibility and have nothing to do with Tradefair Spreads, nor does the content of this website or his website.

Why Women Are Better at Spread Betting Than Men?

It’s official.

According to analysis by spread betting providers including Finspreads and international research company Digital Look, women actually do better than men when spread betting.

While women are still outnumbered by approximately 10-to-1 on the trading platform, the female spread bettors are actually outperforming their male counterparts.

Why?

One reason cited is that women simply possess a more considered CFD trading mindset than men.

Sandy Jadeja, Chief Technical Analyst of spread betting provider City Index, has noted that female spread bettors tend to be more thorough with their research and approach their spread betting and CFD trading platforms with far greater caution than their male counterparts.

This leads into another potential contributor in the form of the old gender stereotype that, whilst men will not stop and ask for directions, women are happy to ask for help.

Some experts have expressed a belief that women are more likely to accept when they are wrong and need to ask questions that gives women an edge over men in financial spread betting and CFD trading.

In contrast, research from within the industry suggests that men are more aggressive and try to bully the markets, sometimes opening spread betting and CFD trading positions on shares or commodities that they do not understand.

Men are also more likely than women to refuse to cut their spread betting losses because they don’t like to admit to losing money.

It may be because of this that women spread bet or trade CFDs less compulsively than their male counterparts, which in turn makes them less likely to develop an addiction.

Ultimately though, whether or not women really do naturally possess a better trading mentality than men, spread betting and CFD trading skills still have to be learnt and developed.