The Trading 212 Capitals Blog

When it comes to trading, a lot of people believe that the most important skill you can get is making more money, when in reality (according to more experienced traders) it is not losing what you already have. After all, even Warren Buffett, the world’s third richest man and an investment icon, believes that your #1 rule as a trader is to never lose money. This article is the collection of 8 quotes by renowned investors that might help you better understand the nature of financial risks and manage your losses. This knowledge is important as it could help you stay in the game when everything seems to be against you (because, as you know, you could lose all of your money and your trading would suddenly end). “I’m always thinking about losing money as opposed to making money. Don’t focus on making money, focus on protecting what you have.” — Paul Tudor Jones “The elements of good trading are: (1) cutting losses, (2) cutting losses, and ...

You’ve probably heard more than once that it is essential to diversify your trading portfolio with different assets. But what does it mean to diversify and why exactly would you want to do it? Diversification is a process of adding unrelated assets to your trading portfolio. Correlated assets, no matter how thoroughly-picked, will provide similar results under similar market conditions. The latter poses an additional degree of risk. Imagine all open positions going down at once — this is not something you want from a well-balanced portfolio. Unrelated asset, on the other hand, will provide different results following a particular event and there is a chance that while one of your assets is going down, the other will go up. Risk management, therefore, is the primary reason to diversify, but is not the only one.Read more about the three reasons below. 1. Risk management Risk management is probably the first thing that comes to mind when talking about portfolio d...

We all know that feeling when the trend turns against you and you have to watch your position slowly deteriorate. Definitely, this is not something you would want to experience. Yet, everyone engaged in trading will have to face this problem sooner or later. It is totally fine to lose a portion of your deals, as even the most experienced and successful traders do not win 100% of their trades. However, it is important to address the issue correctly in order to manage your risks and losses. Here are three different ways to address this problem. 1. Relax It may seem obvious, but this is the first thing you want to do when the trend goes against you. No matter how many times you hear ‘get rid of emotions’, you won’t benefit from this technique until you do exactly that.  You increase your chances of success by sticking to the trading strategy and staying cool-headed. When you see a sudden trend reversal, avoid making emotionally driven decision. What you want to do ...

We all know that feeling when the trend turns against you and you have to watch your position slowly deteriorate. Definitely, this is not something you would want to experience. Yet, everyone engaged in trading will have to face this problem sooner or later. It is totally fine to lose a portion of your deals, as even the most experienced and successful traders do not win 100% of their trades. However, it is important to address the issue correctly in order to manage your risks and losses. Here are three different ways to address this problem. 1. Relax It may seem obvious, but this is the first thing you want to do when the trend goes against you. No matter how many times you hear ‘get rid of emotions’, you won’t benefit from this technique until you do exactly that.  You increase your chances of success by sticking to the trading strategy and staying cool-headed. When you see a sudden trend reversal, avoid making emotionally driven decision. What you want to do ...

We all know that feeling when the trend turns against you and you have to watch your position slowly deteriorate. Definitely, this is not something you would want to experience. Yet, everyone engaged in trading will have to face this problem sooner or later. It is totally fine to lose a portion of your deals, as even the most experienced and successful traders do not win 100% of their trades. However, it is important to address the issue correctly in order to manage your risks and losses. Here are three different ways to address this problem. 1. Relax It may seem obvious, but this is the first thing you want to do when the trend goes against you. No matter how many times you hear ‘get rid of emotions’, you won’t benefit from this technique until you do exactly that.  You increase your chances of success by sticking to the trading strategy and staying cool-headed. When you see a sudden trend reversal, avoid making emotionally driven decision. What you want to do ...

If you are interested in the world of trading and its history, you can probably name some well-known successful investors. Warren Buffett, George Soros, Abigail Johnson — all these names seem so distant: yes, they succeeded, but what is in it for you? You may feel confused and be discouraged, not knowing where to start and what to do. But instead of giving into this overwhelming feeling, read this article, learn about the differences between experienced and novice traders and use this knowledge to your advantage. The success of the great investors is, without doubt, a phenomenal thing, but there are always similarities between successful people. What is it that they do right? What makes the great investors so great and is there a secret they know that you do not? How can you use their success in your favour? Let’s break it down. 1) Successful people value education Good education starts from a young age, but it does not stop there. You need to continue learning...