To be successful in trading, you need to have the best possible trading strategy, i.e the most consistent and the most successful. To do this, you need to have clear goals and a clear course of action. To help you develop it, here are five trading methods that have proven successful when it comes to both Forex and financial markets.
This is the strategy that Forex traders should use. It is an excellent way to gain experience and consists of multiplying operations in a single day before taking stock at the end of the session. In order to obtain gains, you must know how to withdraw at the right time and maintain a positive balance between your profits and losses. The risk is present but limited to small investments.
Hedging is to be used when you are not sure of the evolution of the price of a financial product. It consists of placing 100% of your money (without risk but without profit) in order to observe the trends of a position and to profit in the future from movements that go against your first trade. Quite complex but useful in certain situations.
Carry Trade is primarily for the more experienced and those with a large capital base as it is a method that requires substantial investment. It consists of buying currencies with low interest rates and selling them against currencies with higher interest rates. Basically, we play on the interest rates and the value differential between currencies. A simple principle but a rather complex implementation.
Counter-trend investing is certainly the riskiest type of operation in the stock market and in the financial markets. As its name suggests, it consists of trading against market trends by playing on correction movements and trend reversals. These investments can be very profitable but offer very few guarantees.
Swing trading is an excellent alternative to day trading for beginners. Here, nothing too complex: you bet on the market trend and withdraw when it weakens. Simple and effective.
In conclusion, there is no one best method of trading. Depending on your experience, your temperament and the circumstances, you will certainly prefer one or the other. A good reason to study them all.