As a beginner investor, CFD trading is one of the best ways to make your starting investment fund go further with leverage. This type of investing focuses on both short-term and long-term profits, depending on what you want. The only problem, however, is that CFD trading can sometimes be risky to get started with. That’s especially true if you don’t have proper knowledge of investing or you simply use the wrong broker. The best CFD trading advisory platforms, such as Winsidetrading, will always advise you to always use the Stop-Loss order when trading.
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What exactly is CFD trading?
Contracts For Difference (or CFD) is a popular financial instrument every trader needs to have in their portfolio. CFDs have been around since the early 1990s – brokers offer them for common instruments, such as Forex. As a beginner investor, once you decide to start trading CFDs, you’re simply engaging in a contract with the broker.
Today, CFD trading primarily focuses on calculating profit and loss by considering a couple of factors. For instance, by trading CFD, you (as a trader) have to look at the difference in price between the time you “entered a contract” and “exactly when you exited” it.
The simplest way to calculate your profit or loss is by finding the difference between the Price 1 (when you entered) and the Price 2 (when you exited), multiplied by your number of CFD units.
Tips on how to start trading CFD
As a beginner investor, one thing you need to keep in mind is that trading CFD isn’t a difficult thing to do. While CFD trading is a simple process, you still need the right information to become a successful investor. That said, the following tips will guide you on how to get started as a CFD trader:
Get the right information about CFD trading
The very first piece of advice about CFD trading is for you to avoid it if you’re yet to get enough information about it. Today, there are a couple of websites out there that provide investment information and advice regarding how to become a successful Contracts For Difference trader. One of these sites is Winsidetrading.com, a platform that has been around for more than 3 years.
Win Side Trading is neither a broker nor a registered financial advisor. If that’s the case, you must be wondering how the site generates information on how to successfully trade CFD. It’s pretty simple; all information from this site (winsidetrading.com) comes from experienced authors of articles and private traders of website owners.
Create a CFD account
Unlike other forms of trading, applying for a CFD account is pretty straightforward. It doesn’t take much time; all you need is to provide your details and wait for the approval. There are tons of CFD trading platforms out there that you can trust you enjoy this goodie. Some of them are MetaTrader 4 (MT4) and MetaTrader 5 (MT5).
Create a good trading plan
Creating a good trading plan is not so easy as you need the right experience to do that. Interestingly, you can always get advice that matters on the Win Side Trading platform to get started with this process.
Create g a good trading plan requires you to include motivation, goals, time commitment, attitude to risk, and funds, in your trading activity blueprint.
Set profit-loss order
One thing Winsidetrading.com will always tell you about CFD trading is that you need to always set profit-loss order. This approach is important if you truly want to make your investment capital go further with leverage.
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