Spot trading is a new investment channel. Buyers and sellers in the spot market must settle with the financial market within a few trading days after the end of the transaction. In order to profit from spot trading, investors must master the relevant skills, and also have to grasp the actual situation. This article introduces to you what are the spot trading techniques and how spot trading can be profitable.
What are the spot trading techniques?
- Three don’t: don’t do it when tired, sleepy or weary; don’t do it when you’re in a bad mood; don’t do it when you don’t understand the market.
- Weak position: When trading, open a position according to the amount of funds in the account. The general principle is that the position does not exceed one-third of the amount of funds.
- Strict stop loss: After placing an order, whether it is long or short, the loss range cannot exceed 3 points. Exceeding means that the order is wrong. No matter how the market goes, stop loss must be considered.
- It is forbidden to have luck: fluke is a taboo for survival. If there is a fluke after a loss occurs, it may lead to more serious consequences. Therefore, you must strictly stop the loss after making a mistake, and you must not take any chances.
- Non-retaliation ordering: The psychology of gamblers after losing is to make money, and investment must not have the same psychology of gambling as gamblers. The general principle is that the loss cannot exceed twice a day. Once there are two losses, the state is not good and the possibility of continuous losses will increase. Therefore, there may be retaliatory orders, which must be strictly prohibited.
- Frequent orders must stop loss: the number of transactions is large, and the probability of errors is also high. The first principle of trading is the safety of account funds and the interests of customers. Do not make frequent orders for the pursuit of order quantity. The principle of multiple orders is to protect the profit of the account.
How can spot trading be profitable?
The spot market mainly uses the price difference to make profits, that is, the use of market changes to buy low and sell high to obtain profits, including high-frequency, short-term, mid-term and long-term trading methods. For example, when the investor Mr. Wang bought 2 lots of 5,000 ounces when the price of spot gold was 15 US dollars per ounce, the price rose to 15.8 some time later. At this time, Mr. Wang closed the spot holdings at 15.5. , Then his profit is: (closing price-opening price) * number of lots * product unit, that is, ($15.5-15) 25000=$5000, which is his profit. If the market is not good and the price drops, the same calculation method, the result of a negative number, proves a loss.
It can be seen that there are many spot trading techniques. Although these techniques do not seem complicated, it is not easy for investors to do well. This requires investors to have enough experience and be able to use these techniques flexibly. As for the issue of spot trading profit, in fact, it is still making money through price difference, which is similar to other investment transactions.