1. Regulation. Make sure your contracts for difference broker is regulated by FCA or other respected regulatory authority. Remember, you money could be at risk if you trade with a dodgy broker.
Trading In Rising & Falling Market
1. How are the spreads? are you satisfied? Shop around as there are so many brokers to choose from. A bit of leg work will save you time and money.
1. You need to set up your trading targets. What do you want to achieve trading forex or CFDs (or any other financial market)? You need to set realistic and feasible objectives and adhere to your plan throughout your trading.
1. Have a trading plan.
Regulation. Make sure your CFD broker is regulated by some prominent regulator such as FCA (UK), ASIC (Australia), Cysec (Cyprus), or FSB (South Africa), your CFD provider should be regulated by at least one of those regulators.
Successful traders tend to specialise and know their traded markets upside down, just think of hedge funds, each fund specialises in 1 particular market and thoroughly researches it.
Is leverage good?
1. The first cost in incurred by the long term traders and it's the overnight financing. This is the the cost a trader has to pay every night for holding his/her position (it's usually around base currency borrowing rate + 2%).
As most would guess, CFD trading started in the City of London in the early 1990's as a type of margined equity swaps. At first, they were only available to institutional traders and investors such as hedge funds.
It is vital but equally difficult to keep your emotions in check but emotions can cloud your judgement and you can rush into spontaneous and irrational decision; whether it's a CFD trading entry or closing your positions at the wrong time.
Leverage: CFDs are a leveraged product and thus should be treated as a risky instrument. Treat leverage with respect and it will respect you. Never over-leverage and keep your trades under control.
1. Short-term strategy or scalping: as the name suggests, it is a very short-term method that involves a very quick trades in order to clear as quickly as possible. This strategy is considered to be the most stressful and time consuming.
What strategy should I Use?
The speed and quality of their trading platform. Most
1. CFDs vs Financial Spread Betting: the main difference between these two is that spread betting is CGT-free; thus you don't need to pay tax on any profit you make, at the same time your losses can't be offset against future gains.
No matter how much you think a certain position is going to be a “sure thing,”
Leverage: How about the leverage? It might be fixed in the EU but it's not everywhere so make sure you control the leverage. cfdspy.com/leverage/cfd-l…
1. CFDs vs Options: both are derivative products are the main difference here is that options have pre-defined expiry date.
1. Leverage offers a great advantage for retail trader but it comes with its own benefits and risks. Leverage "technically" allows you to borrow money from your broker and thus you don't need to pay 100% value of the underlying instrument.