As with any sort of financial investing the only certainty is that nothing is certain and rewards cannot come without risks, but knowing how to manage those risks will ensure that over time you become a winning financial spread trader.
When considering financial spread betting you must examine the possible benefits and balance them against the potential disadvantages in order to gauge whether or not the risks are acceptable. Since financial spread betting allows traders to make profits free from income tax (UK), there being no Capital Gains Tax on any income made and the fact that it is possible to go short as well as long, the potential for earnings can seem limitless at first glance. And, for the intelligent trader, they can be. But in order to get to that point, you must take steps to learn how to diminish and control the risks involved.
Just as every individual must learn how to ride a bike with training wheels before they are capable of riding on their own, financial spread betting is something that should be done in stages, working your way from the bottom up in order to decrease the risks to your investment. And while initially it might appear as though financial spread betting is a subject that has so much information behind it that it would be impossible to learn it all in a short period of time, the 21st century has that information available at the click of mouse, allowing anyone anywhere the knowledge necessary to get up to speed on how to deal with the risks associated with financial spread betting.
Make Money From Financial Spread Betting Guide Tips
Many individuals find themselves hesitating at the thought of risking money, and this can be considered the first hurdle to overcome. There is always risk involved in investments, regardless of whether you are investing in the property market, opening a restaurant, investing in a start-up business, or any other enterprise. But no one makes money without taking risks. Yes, there are risks, but when gauged against the potential income, they are minimal at worst. Educating yourself is an essential part to becoming successful and joining the winning traders and a home study course such as making money from financial spread trading can help put the odds in your favour.
Where to start?
Choose a market you have an interest in or perhaps work within. This will help you to overcome any monotony in reading all about the companies in that particular market for many individual shares (equities) is a good place to start, remember with Financial Spread Betting you can profit from Up and Down movements. It’s important to have some sort of a trading system and know when to get in and more importantly when to get out, this is covered in my course.
The next step is to choose a spread betting company who you believe will offer you the support you require and has financial stability and a reliable dealing platform, my experience is its bets to go with the larger more established companies.
You will need a platform that is stress-free to use and has an intuitive user interface, preferably with very clear ‘Buy’ and ‘Sell’ buttons, as well as quick access to depositing more funds. More importantly perhaps is that it executes the trade quickly when you are closing out positions. This will help to ensure that you can effectively cut your losses should the market be moving against you.
Above and beyond educating yourself on how financial spread betting works, one of the most effective methods of guaranteeing extra money does not get away from you is via the stop loss system that every financial spread betting firm allows traders access to. It is virtually impossible to eliminate all risk related with financial spread betting, but using stop loss limits on your accounts allows you to close the trades at a pre-determined level in case the price of the market moves against you in dramatic falls.
A stop can also be used to lock in profits as well, think of it as a safety net.
There is no doubt that it can be exhilarating to play the market, and the risk of betting large quantities can sometimes prove to be an overwhelming rush for some individuals, but there is no reason to sink yourself with one trade, so making educated and limited bets until you have had a chance to learn the system is the best way to ensure profits. In fact, this remains true for both novice and experienced financial spread traders.
There is no substitute for experience, and the only way to get that experience is to overcome your fears of risking money, start with the minimum bet sizes permitted, the objective when starting out is that fact your learning and testing the system rather than then actual amounts you make. If your system makes money with 0.50p a point then it will make money at £100 a point.
Remember that financial spread betting is about making money in a controlled way, not gambling, and even if you are someone who has been in the game for a long time it is never a good idea to have too much exposure to any one company or market however sure you are.
Just remember that there will always be some risk involved, there will always be unexpected events we are dealing in unknowns but if you take the time to learn how financial spread betting works and make sure you manage your risk will find that the potential earnings are well worth the risk in the long run.
Learn more about Spread Betting and Vince Stanzione at www.winonmarkets.net