Nigeria : Volatility equals opportunity – What to do when markets are uncertain

  • 14 June 2022 / News / 427 / Fares RAHAHLIA

Nigeria : Volatility equals opportunity – What to do when markets are uncertain

The first six months of 2022 have proved disastrous for most markets. The technology sector and cryptocurrency saw a huge selloff. The only sectors that continue to thrive are oil and wheat, though this is directly attributed to volatility caused by the ongoing conflict in Eastern Europe.  

And yet amidst the market turmoil, there’s hope for traders; the stock market has been rallying into June. The current rally, according to experts, has a decent chance of lasting well into the Northern Hemisphere summer. 

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Good traders can spot opportunities regardless of which way the markets are moving. By partnering with an award-winning broker, such as CMTrading, you’ll be able to thrive even when markets are volatile. 

Fred Razak, the chief trading strategist at CMTrading, said: “It’s important that traders trade responsibly. Look for opportunities that will present themselves as we head into the Northern hemisphere summer trading.  

“There are still lots of things happening in the world both economically and geographically and politically that are adding some pressure on the market right now.” 

How to become an online trader in 2022

Here are 5 top tips for dealing with market uncertainty:  

1. Stay calm, and don’t panic!   

The first time a trade goes wrong, or you see the market drop can be stressful. It’s easy to think of pulling out all your investments and cutting your losses.  

Instead, you should do what all experienced traders do – nothing. Don’t panic and take your emotions out of the equation. The best traders watch to see how they can profit even when the markets are down. 

2.Stick to a strategy  

It can be tempting to start switching strategies or assets the first time you take a loss. You’ll have a much better chance of success in trading by implementing a strategy and refining it. Not every trade will go your way. Even the best traders suffer losses. The difference between a beginner and a veteran trader is that the latter can learn from their mistakes.  

3. Have realistic expectations   

Many sadly get into trading thinking it’s a get-rich-quick scheme. This can prove disastrous when markets are down. It’s slow and steady that wins the trading race. Do your research and understand that markets experience cycles – you can trade and profit regardless if markets are moving up or down.  

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4. Don’t make too many trades at once  

Start small and build up to large positions. By taking smaller positions you’ll be able to stay in the game longer even if you take a loss.    

5. Knowledge and experience make trading easy   

 Anyone can become an online trader but to be successful you need knowledge and to partner with a great broker. Fortunately, CMTrading is here to help traders of all skill levels have the best possible trading journey. From webinars to in-person training sessions, CMTrading is here to guide you to success.   

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Trading CFDs        

One of the most advantageous methods of benefiting from stock movements is to trade CFDs online. CFDs or Contracts for Difference are financial derivatives that allow investors to speculate on the price fluctuations of an underlying financial asset (I.e. Amazon or Microsoft) without buying it beforehand.        

Moreover, CFD traders can profit both when prices are rising as well as when they are falling. This is because CFD trading allows traders to open a buy or sell position, which means they can buy when prices are moving up or sell when the prices are dropping to generate profits.         

Also, CFDs are traded on margin, which means that traders only need a small amount of capital to open a position on the market and enjoy increased returns at the cost of higher risk exposure.         

Please note that trading CFDs is considered a high-risk investment, which can result in the loss of your invested capital. Always get in touch with your account manager to discuss profit targets and how you can minimize your exposure to downside risk.        

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