The Trading 212 Capitals Blog

Let’s start with a little example. Imagine two traders.  Trader A  can boast a 50% win rate, $200 average profit and $100 average loss.  Trader B  has a 75% win rate but also an average profit of $100 and an average loss of $400. It is easy to notice that in the long run trader A, though less successful in terms of win rate, will win, while trader B will siphon his money. What does it mean for you? In trading, it is usually more important not to lose what you have than to earn more. Countless traders, investors and industry experts have dedicated their time to the problem of risk management and, in the end, came up with what may seem like a commonly accepted solution. Turns out, the first thing to consider is the amount of money you can afford to lose in a single deal. But what exactly is that amount? Should you risk $10, $100 or $1000? No! Most professional traders believe that the amount of money you spend on a single trade should not be fixed...

While charts carry historical data for many years back, with past quotes becoming less significant over time, it’s natural to limit your analysis to one (often, more than one) time frame, which provides enough information to perform a trade. Defining your main time frame gives you the perfect grounding for identifying the trend and market reversals, and for refining your trade’s entry and exit points with graphical tools and indicators. Choosing the right time frame is therefore essential for any good technical analysis, which should capture as much relevant data as possible while minimizing false signals. There’s a variety of time frames to choose from, starting from a couple of minutes end extending to years, but there are steps you can take to narrow your options. Reading this article, which compares the pros and cons of different time frames, is a good start. Make a choice based on your trading preferences You will observe that some of them have a differ...

Well, successful traders exhibit a number of traits proven absolutely essential to excel in trading. While it’s true that the right trade can be life-changing, almost any experienced trader will tell you lucrative trades don’t come from luck but rather skill and strategy. That being said, here are five personality traits known to optimize trading performance. Discipline There’s a popular mantra in trading that goes, “Plan the trade, and trade the plan.” The market is full of temptation, and only the most disciplined traders are equipped to avoid falling under its spell. Traders can be tricked by their intuition, often resulting in simple but costly mistakes. Disciplined traders stick to their plan, improving their shot at success by doing so. To be clear, discipline doesn’t mean you should use just one trading technique over and over again. It means knowing when, how, and where to employ the strategy you want to use, making sure to follow it accordingly. Pati...

Forex   Forex is the world’s most popular trading instrument, and for a good reason. It offers unmatched versatility: currency pairs can be traded both long and short, and the profit potential is unlimited. Technical and fundamental analysis techniques can be applied to FX trading for additional synergy. CFDs on stocks CFDs on stocks can boast potentially unlimited profitability. Both short and long-term deals can be utilized when working with stock CFDs. This instrument will better suit those willing to follow corporate news, conduct fundamental and value analysis but will also suffice for adherents of technical analysis. CFDs on cryptocurrencies CFDs on cryptocurrencies track the performance of the world’s most popular crypto assets. It is still unknown whether you can analyze Bitcoin and its younger peers from a fundamental viewpoint. Yet, it is perfectly known that crypto currencies can be traded on both short and long time intervals. CFDs o...