Top 10 Rules for Successful Trading

Whether you are new to commodity trading business, or have been there for many years, there are certain disciplines that one needs to follow to become a profitable trader. There’s a very steep learning curve that decides whether you are a good trader or not. And no matter what you trade, it’s how you trade that matters. So, if you are looking for ways to become successful at non-ferrous trading.

Here are 10 golden rules you must follow.

1. Follow a Trading Plan: Before you enter into the real trading, make sure you have a written plan that specifies your entry, exit, profit taking level and a money management strategy.
2. Become an Expert in Futures and Options: As compared to equities, bonds and currencies, metal trading is the most volatile asset class. So, it’s important to learn the ins and outs of futures.
3. Treat Trading Like a Business: Understand that trading is not a hobby or a job, but a full-time business that requires time and effort.
4. Make Full Use of Technology: With advancement in technology, getting used to fully automatic metal supply via Internet of Things (IoT) will take your ferrous trading business a long way.
5. Understand Contract Specifications: Each commodity has different characteristics, so understand all the contract specifications beforehand for the markets that you are considering.
6. Understand the Fundamentals of Supply and Demand: Metals are economic trading vehicles and the prices fluctuate frequently. Therefore, it is important to learn the supply and demand characteristics of these raw materials in the market.
7. Protect your Trading Capital: Trading is all about taking risks, but taking excessive risks can decimate your trading capital, thus putting you out of the business. So, take wise decisions.
8. Focus on Learning: Understanding the market is a lifelong process, so you must focus on learning more each day.
9. Consider Technical Factors: It is important that you study the behaviour of prices by understanding the historical trends to predict the future trends. And, consider both short-term and long-term price data.
10. Keep Trading in Perspective: You must always focus on the bigger picture, and accept winning and losing as a part of business.