CFD
trading has become very popular nowadays among the investors and
traders. If you are one among them looking to trade CFDs then you
must know some CFD
trading strategies
to increase your chances of success. With the help of these
strategies and systems, you can improve your profits. Let us go
through some of the common CFDtrading strategies:
Mean
reversion systems
These
CFD
trading strategies
work on the theory that shares and stocks that go down are likely to
bounce up. You can test these mean reversion or dip buy systems on
previous market data that you wish to trade this strategy with. Make
a note of win loss ratios, profit loss ratios and the number of
trades that the system sets off. Some times many stocks may be set
off so be careful during big dips. Make sure that you note down the
past draw downs. These systems are more inclined to higher win loss
ratios which makes them preferable to trade with.
Swing
trading
This
strategy is based on avoiding choppy stocks that are out of trend and
getting into those that are trending up followed by going short on
down trending phases. Swing trading strategies is basically for
shorter term trading. Here entries and exits are decided on the basis
of chart patterns and indicators. This type of strategy is suitable
to the trading styles where smaller moves are exploited.
Longer
term buy and holds
These
strategies are based on mechanical and fundamental triggers. They
work in a longer time frame ranging from weeks to months to help
stock give more room to breathe and experience larger movements.
Some CFD
trading strategies
and systems are based on a strongly trending stock and work on a
theory that this stosk may continue to rise. Long term positions have
holding or interest cost but larger moves will have to compensate for
these costs.
Thus
we see that there are some Online CFD trading strategies
that are used by the traders to exploit movements in the market.
These systems play important role in deciding whether CFDs should be
traded with or without leverage. So it is important to learn some
good CFD strategies to ensure success.
About
Trading Lounge
Trading
Lounge is an online trading, analysis and education provider that
offers services such as Day Trading, Trading Strategies, Technical
Analysis, and How to Trade advice by a reputable and experienced
trading coach. TradingLounge.com.au was started by Peter Mathers in
1982 to meet the growing demand of accessible and sensible education
in online trading.
No comments:
Post a Comment