Below is the first of three articles. In this series, the experts at Octa share 13 practical recommendations based on the broker's 13 years of experience in the market.
The first article outlines five crucial elements that will help form a firm foundation for trading success.
1. Acquiring theoretical knowledge to unlock new practical opportunities
Octa continuously studies its clients’ experiences to gain first-hand insights into the traders' minds and finetune its products and services to their demands. A vast majority of Octa's clients who achieved consistent profits indicate continuous learning as one of the cornerstones of their success. They read trading content online, sign up for dedicated educational courses, and study the strategies of professional traders to keep up with the best practices.
Another factor of success that many emerging traders underestimate is having a fluent knowledge of basic financial concepts. For example, learn to calculate potential profits and losses for a given order based on the lot price and spread amount to be able to use risk management tools properly. Likewise, know how the support and resistance levels work and what the candlestick patterns are to be able to identify potential entry points correctly. In trading, as in any other comprehensible system of knowledge, advanced techniques are unlocked step-by-step. Progressing along the learning curve is only possible if start by mastering ground-level concepts.
Octa offers various educational resources, including its YouTube channel, which boasts more than 1 million subscribers, and a broad scope of educational materials available within its proprietary trading platform, OctaTrader.
2. Keeping emotions under lock and key
Many professional traders compare their ideal mental state during a trading session to the workings of a robotic assembly line. Each movement is time-efficient, precise, and purposeful. Each sequence of actions leads to a measured, predictable result. There are no impulsive or chaotic moves, and nothing is left to chance. In a perfect world, your trading sessions would look like that, too.
Alas, reality imposes its own—imperfect—conditions. One day, you may be tired after work. Another day, you feel fine, and brain functions like clockwork—but the market is feverish with wild fluctuations, and your predictions fail time and again.
This is where self-discipline and the right mindset come into play. One can't control the market environment, but one definitely can control own emotions—and make sure they don't undermine the efforts put into achieving consistently positive results.
3. Establishing a solid risk management strategy
In trading, potential profits always have a reverse relation to risks. In other words, one can only achieve significant gains by exposing capital to a proportionate degree.
Risk management techniques are part of any successful trader's toolkit. The concept of risk in trading is based on risk tolerance—or the amount of loss prepared to handle. The risk tolerance depends on the starting capital and long-term financial goals. In their turn, these factors define the choice of trading instruments.
For example, if your goal is to obtain a supplementary source of income without delay, you may consider Forex trading, which allows traders with modest starting capital to gain regular income for day-to-day purposes.
4. Improving time-efficiency
Less experienced traders often spend an excessive amount of time comparing expert predictions and trying to validate their decisions. However, the vast field of trading information available online is very diverse in terms of quality and trustworthiness, so it's no wonder that obtaining valid and actionable trading advice becomes an uphill battle.
To solve this problem, Octa embedded a dedicated feed with curated expert content into its proprietary trading platform, OctaTrader. This toolkit is called Space and is currently available for all OctaTrader clients across all regions of the broker's operation. With Space, OctaTrader now offers a customisable stream of actionable trading recommendations that you can transfer to your chart in a few clicks.
5. Learning from the mistakes of others
In trading, as in life, mistakes are inevitable. Given that, studying various lifehacks allows navigation to the most notorious pitfalls and keep away from trouble. You don't have to make all the mistakes in the book and learn the hard way. Instead, choose a broker with extensive educational capabilities—and study typical client cases, reinforcing the acquired knowledge on demo account if needing additional first-hand experience.
In the next instalment of our three-piece mini-series presenting 13 crucial trading recommendations, we will give a short list of the most impactful skills that allow successful traders to achieve consistency and turn trading into a steady source of supplementary income in a reasonable amount of time.
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Octa
Octa is an international broker that has been providing online trading services worldwide since 2011. It offers commission-free access to financial markets and various services used by clients from 180 countries who have opened more than 52 million trading accounts. To help its clients reach their investment goals, Octa offers free educational webinars, articles, and analytical tools.
