Mercedes Pantazi, Customer Support, easyMarkets
The growth of online trading platforms has democratized the global financial markets. Once only accessible to a very narrow segment of society, the financial markets can now be accessed by virtually anyone with an internet connection. This opportunity has given rise to a new generation of financial traders, many of which are trading part-time from the comfort of their own home or office.
In the information age, becoming a part-time trader is one of the best ways to earn a secondary income. Below we outline the five keys to becoming a successful part-time trader. By applying these principles, you can begin leveraging the equity, commodities and forex markets around your busy schedule.
- The more you learn, the more you earn
It goes without saying that knowledge is the key to success. Your ability to understand the market you are trading, anticipate newsworthy items and apply technical and fundamental analysis are critical to your success. If you’re new to trading, you should take every opportunity you can to read about the financial markets, follow the news and learn how to analyze securities.
- Identify your risk tolerance
If you’re new to trading, you’ll quickly learn that risk management is just as important as picking successful trades. By identifying your risk tolerance and working within it, you might avoid unnecessary, costly mistakes. This includes using trading tools such as stop-loss and take-profit orders, determining your drawdown levels and using correct lot sizes. These tools may help you minimize your losses when trades go against you and may secure profits when trades go in your favour.
- Trade around your busy schedule
If you’re a part-time trader, time is of the essence. You don’t have 12 hours a day to devote to trading, so make sure you set aside enough time to trade effectively. Enable mobile trading, set up automatic alerts and create automatic charts every time you login to your online trading platform. Although these tools may seem insignificant, they will save you a ton of time over your trading career. They will also help you become a more efficient trader. If you are unable to trade during the day, forex might be your best option because the market is open 24 hours a day, five days a week.
- Pick the right broker
Choosing the right broker is one of the most important decisions you will ever make as a trader. Remember, your broker not only facilitates all your trades, it is responsible for your entire trading experience. Things like execution speed, spreads, trading instruments, trading platform and regulatory structure must be scrupulously studied before you decide on a broker. Things like customer support and personalized trading tools should also be considered when choosing the right broker.
- Stay motivated
Deciding to become a part-time trader is easy; sticking with it long-term is much more difficult, especially after a few bad sessions. Losing money in the market is something every trader experiences, regardless of their wealth or level of expertise. What separates successful traders from the rest is their ability to manage their losses and learn from their mistakes. This is why risk management is extremely important. If you’re serious about trading, longevity is key to success.
There’s a reason millions of people around the world are becoming part-time traders. Your ability to control your hours, access the world’s most liquid markets and learn everything you need to know with a click of a mouse have made part-time trading a viable option for people from all walks of life. Through education, practice and discipline, you can put the financial markets to work for you on your own schedule and at your own pace.