Trading is a desirable pursuit. However, few become professional traders capable of turning a stable payout. In order to get better at trading, you will need to study and practice a lot. Knowing what to learn and how to sharpen your newly acquired skills is as important as your persistence and diligence. Today’s article is a step by step guide that will help you improve your skills.
- Learning the basics
As with any activity, whether profit-oriented or not, you would want to start with the basics. Seems logical, yet a lot of novice traders skip this step only to find their account devastated, their chances of becoming a successful trader close to zero. Don’t let the pride blind you and don’t be afraid of learning the easy things before you move on to the advanced stuff.
Your success, as a trader, will quite often depend on the understanding of the very basic economic (sometimes political, social and psychological) concepts. In the very beginning try to understand how the price of the asset moves, what are the most commonly used trading terms, what it means to trade an asset. All the information that falls into this category is the most objective and needs to be memorized. Limited practice may be required to better grasp these concepts.
You’d probably not be surprised to know there is even more to learn once you are finished with the basics. On this stage you would want to learn more about the various markets that exist (hint: there are a lot of them, all with different conditions and trading styles) and the ways they operate. It is also when you choose your preferred asset class. When working with IQ Option, you can choose between CFDs on Forex, stocks, cryptocurrencies, commodities,indices and FX Options.
After finishing this step, you should have a complete picture of the present-day global financial system, be able to understand and use the terminology and grasp the difference between assets. Remember the saying: don’t trade what you don’t understand. Can you, for example, explain what is the connection between the exchange rate and the interest rate? If not, you probably still need to learn the basics before moving further.
Now, when you know what to trade, it is time to learn how to trade. Easier said than done. Working strategies are never published for free (who would reveal their source of income?). Chances are, you will need to come with a working strategy of your own. Trial and error works here perfectly. Luckily, you’ve got a free and replenishable demo account to test all the strategies you want. Give one of them a try and if it is not working as intended, move on to something else. You can also find a professional trader, willing to become your mentor. Books and articles, written by them, will work, too. Don’t be frustrated too easily, it may take months to come up with a good trading system.
Now, to the most important part. You may learn all the information available on the topic of trading and never become a professional trader. At least, unless you get your portion of first-hand experience. It is impossible to win every trade. However, it is possible to master tour discipline, getting rid of emotions and sticking to the trading system you’ve come up with.
Surprisingly, a lot of traders give up at this stage, when they are closer to success than ever. Don’t be afraid of losing deals, better concentrate on how you handle them. At this stage, you want to learn from your experience, understand the difference between winning and losing deals, adjust your strategy and, if it stops working, come up with new ones.To the platform