Profitability is the goal that every TRADER wants to reach one day. Being profitable means that, in percentage terms, you earn more than you invest. The closer you get to 100% profitability, the better use you are making of your money. And as much as we would like to give you success, there is no trick that will make you have a high level of profitability, but there are tips that will help you improve your results. And as you know, every step to improvement counts.
The first way to improve your profitability is to improve your PSYCHOLOGY.
What is Psychotrading?
PsychoTrading is the science that studies the emotions and behavior of traders when they operate in the market. It aims to make traders aware that they have the ability to manage their trading consistently, so that they are not affected by their emotions before, during and after their investments.
Some people see trading as a casino, where you place a bet and you can win or lose. It depends on the case: there are traders who feel a great euphoria after winning the trade of their life, or the opposite extremely dejected after losing a lot of money. This is not healthy behaviour, nor does it help us to improve our profits. The reality is that our task, as professionals, is to generate profits through data, not to win a lucky bet that is not supported by anything rational. It is nice to feel a stroke of luck, but this is more of an illusion that takes us away from what really matters: us.
To improve this aspect, we suggest you ask yourself these questions when investing in an asset: Do I have a strategy, do I know this market, am I getting carried away by enthusiasm? This will make you think about whether or not you should risk the amount you are about to invest. If you don’t know the market, walk away and study it first for several weeks on a [DEMO] account (https://canaltrader.com/plataforma-de-social-trading).
Another important question is whether you are trading at a time that you are comfortable with. Some traders trade in the morning because they feel fresher, others prefer to study the market in the morning and trade in the middle of the day. It’s up to you.
The second way to improve your profitability is COPY TRADING.
This trading technique is based on copying professional traders with a high level of profitability. There are platforms such as Naga that allow you to see other traders’ percentage of profits and the markets in which they trade, so that you can assess their trades and (if you see fit) automatically copy their actions.
For example, if you copy a trader who has a 95% profitability, you can program the trades to copy 10% of the amounts he invests, within a take profit and a stop loss.
We explain what copy trading is here: What Copy Trading consists of
And finally, another option that we like a lot to improve profitability is SOCIAL TRADING.
This technique is very similar to copy trading, with the difference that you do not always copy automatically, but you can read other people’s trades and their opinions about them, just as you would do in a social network. In this way you can learn a lot about a market that you did not know, or you can value investments without having to spend all the time it would normally require to get to know the market.
This trading technique is explained in more detail here: What is Social Trading
As always, we hope we have helped you a little more to improve your trading. May the market be with you!