Confused ...

[jayel49]

I've read with interest several threads regarding what I should do and should not do as a newbie trader, but to be honest the more I read the more confused I become.

I understand the principals of spread betting and have opened accounts with IG Index and Finspreads but where do I start. I realise it would all too easy for me to be ensnared into buying in to a get rich quick scheme or be persuaded to attend an expensive training course and have no intention of going down that road. Whatever I do I want to be able to stand on my own two feet and be able to trade by making my own decisions.

So where do I start, which software should I get, which trading system would be best for me? I've about £5,000 capital and still work full time thereby limiting tha amount of time and hours I can spend trading.

Any suggestions would be appreciated, if I've not given enough information please let me know what else is needed.

Thanks

 

[Skimbleshanks]

If you are working full-time, I assume that means a regular 9-5ish sort of day. You therefore have three options:

a. trade UK markets EOD (end of day), ie just take your trading decisions based on daily bars;

b. trade US markets intraday (the 19:00 to 21:00 UK time session gives some good moves); or

c. trade US markets EOD using daily bars, which gives you the opportunity to exit/enter a position in the last half hour of the trading day if you prefer.

You will also need to bear in mind the stocks/indices that IG Index and Finspreads list as being available to trade.

When you know that, we can help on what sort of software, etc, you need.

And welcome to T2W by the way!

 

[donaldduke]

As a newbie i think this advice is the most important, regardless
of which system you use:

Do not trade more than the minimum bet size until you have atleast three back to back profitable months.

IG Index have big minimum bet sizes so you probably want
to avoid them for now.

Finspread i believe let you trader 1p in the first 8 weeks and
thereafter its 50p a point.

Instead of paying for seminars buy books and spend
time reading and learning about trading.

 

[donaldduke]

jayel49,

What time span are you comfortable with?

Do you watch the market on a daily chart and think you
can predict where the market will be in the next hour or so
or do think you have a feel for where a stock or index will trade
in the next week or month?

 

[ChartMan]

Are you prepared to lose the £5K? Try with £1k and see what happens.Whatever you chose, the odds are really stacked against you.It realy is a tough learning curve and for most,it is very expensive. Not very constructive or encouraging, but you need to know this before you start...

 

[BBB]

Ain't that the truth!

 

[reddragon]

Hi jayel 49,
Yes - i definitely agree with CM re: steep learning
curve, to be honest, it's vertical !!!.
Also, donaldduke's suggestion that you trade with min. stake
is valid because the only REAL way to learn is at the school
of hard knocks, where you'll have to bleed money before
you'll aquire the necessary ability / experience.

" What you know is EVERYTHING, who you know is not
important, because nobody else is going to get off their
backside amd make money for you"

Reddragon.

 

[jayel49]

jayel49,

What time span are you comfortable with?

Do you watch the market on a daily chart and think you
can predict where the market will be in the next hour or so
or do think you have a feel for where a stock or index will trade
in the next week or month?

I'm more comfortable with a short time span, I feel that having achieved my target I would like to take any profit.

Are you prepared to lose the £5K? Try with £1k and see what happens.Whatever you chose, the odds are really stacked against you.It really is a tough learning curve and for most,it is very expensive. Not very constructive or encouraging, but you need to know this before you start...

I take your point about being prepared to lose £5K and a £1K loss is a more realistic figure. Are you implying by your reply that it is virtually impossible to make any kind of profit from spread betting? Should I put my money in Premium Bonds?!

Which books should I read to learn more?

 

[adrianallen99]

It is not impossible to make a profit spreadbetting, it is just very easy to lose lots of money.

As for taking any profits, be careful with that strategy. I know they say that no one ever went bust taking a small profit, but it is often a mistake. In the last week and a half I have made 4 trades - I have only won 1 of them, yet still made a profit. As soon as I realised I had made a mistake on the others I got out (or my stop was hit). The one I got correct I have just trailed the stop behind it.

When I first started I could win 75% of trades and lose money. Maybe more down to my money management and positioning, but also down to the fact that I took small gains and my 1 loss in 4 wiped all of them out.

I found this site an interesting read, especially the trading truths and 50 golden rules he sets out. financial-spread-betting.com/index.html

Why not try out Capitalspreads.com as you can have a simulated trading account, if you can make money on this you are doing well - Watch the spreads though, I have noticed that they sometimes differ from the real account.

 

[MikeW]

Jayel49,

I'm pretty much in the situation as you - I've a taken a couple of demo accounts out to 'practice' as suggested by others here also. It is well worth trawling through this BB's various forums/threads to cherrypick/glean info to suit you - hours of late night homework for you!! It's generally from people with good experience & can help fill some of the practical 1st hand knowledge gaps that specialist books don't/can't usually cover.

All the best.
Mike