Thousands have turned to online trading as a means of generating additional income; according to “The Modern Trader” report there are approximately 13.9 million online traders worldwide.
Today, CMTrading shares valuable advice for all traders in South Africa.
1. How do you get started in trading?
Fred Razak, senior trading specialist at CMTrading, said: “Well, it starts with education, and today, you know, with the advent of the Internet, anybody can go online and start taking courses about learning how to trade. There are lots of different avenues to trading today. It's an unbelievable environment that we live in today.
“That information is so accessible, and the playing field has been leveled. Nothing is holding you back, and I think that that's one of the beautiful things about the day and age that we live in besides all the stresses that we do live in these days. That's one of the pluses. I think that we have.”
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2. How do I become a better trader?
Razak said: “Once you're familiarized yourself with the markets then implement either fundamental analysis or technical analysis. Once you've brought yourself to that level that you're now familiarized with the markets and you're watching the markets you can start developing your own opinion about the markets.
“What I would recommend people do is, gain education, gain experience and formulate a formula and opinions about the market. Once you feel confident then you’ll trade with confidence.”
3. With the economy, as it is, isn’t trading risky?
Razak said: “Well, as traders, you don't care about what the current climate of the economy is. You care more about, you know, whether there's volatility and there's tradeable action in the market. This means that you can use the information that you have and the experience that you've gained to anticipate these massive kinds of selloffs that you're trading and to take a position. Short selling the market it's, you know, it's just as well as buying the market and selling it higher.”
4. What do you do when it doesn't go your way?
Razak said: “We used to say don't fight the trend - just accept things for what they are. Cut your losses short, and move to the next thing. It's just about brushing yourself off and, you know, really getting back into the game.”
5. Advice for beginner traders who are still sitting on the fence?
Razak said: “Start small - don't ever put in the markets any money that you can't afford to lose. Take it at your own pace and trade small. You could lose R50 to R100 and it's not going to ruin your day but if you lose R100 000, it could ruin your life.”
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