IMPORTANT THINGS TO REMEMBER WHEN TRADING SHARES
The standard trading advice of “buy low, sell high” may sound great on paper, but in
reality, the market does not always provide an ideal trading scenario. Instead, while
keeping your chosen strategies in mind, it is wise to respond to market movements with a
note of caution. It may be better to take a small profit where you can, as opposed to
risking a huge loss further down the line.
1. Respond Quickly
It is important to remember that price swings can
occur suddenly due to the volatility of the stock market and the rate at which
newsworthy events take place. Sometimes profit and loss can be separated by mere
seconds, thus traders need to be able to read the situation and act in accordance in
order to minimize losses.
Mobile applications can make it easier to monitor such events and take appropriate action
when it comes to your open positions. Ensure that you have put adequate measures in
place should you foresee that you may be unavailable for some time and unable to access
your trading portfolio.
2. Know Your Limits
Before opening any trade, decide on the
maximum amount or percentage of the trade that you are willing to lose should things go
wrong, or at what point you aim to take profit should things go well.
Although it might be tempting to change these markers during the trade, the best strategy
is to stick to the initial limits you had set out for yourself, in order to prevent
losses caused by emotional trading decisions. Remember that a small loss is easier to
swallow than a substantial loss that could have been prevented by better
ONE FINANCIAL MARKETS: AN ONLINE TRADING PLATFORM FOR EQUITIES AND SHARES
One Financial Markets is a reputable trading platform perfect for all traders interested
in getting into equities trading. To get a feel for our platform as well as the market
and its movements, we recommend starting with a demo account where you can open trades
using virtual money. One you have built a strong knowledge base around the stock market
and are comfortable with equities trading, sign up for our free live trading