Today’s traders have more choices than ever before. As new trading strategies continue to emerge, more people are investing in the hope that they can make a consistent profit. These are five trading strategies you probably haven’t considered but are well worth checking out.
Online CFD trading
Sometimes you don’t have to own a stock to profit from it. Contracts for Difference or CFD’s give traders the opportunity to speculate on the performance of a wide range of stocks and other items. Trading CFD products is relatively easy to do. A wide range of online CFD trading websites let you speculate on whether a particular stock will rise or fall in value. This can be a risky way to trade but you can make some large profits too, if you know what you’re doing.
Many traders start out dreaming about making huge profits in a short amount of time. However, it’s not always as straight forward as this. In some cases making small gains on a consistent basis is a much better strategy.
Scalping is a day trading strategy that lets you do this by making fast trades that generate a small profit each time a trade is completed. The profit is low on each trade. However, if you do this on a frequent basis throughout the day, it soon adds up to a large amount. Scalping reduces your exposure to large losses and your money isn’t tied up in stock for long periods of time.
Momentum day trading
This is a type of stock trading that depends on the trends associated with a particular stock. Some stock prices are volatile because of different circumstances and events. The Momentum Day Trading strategy is used to exploit trends associated with a particular stock. To make a profit, the trader has to make their trade and close it at a higher price, all in the same day.
This type of hedging investment capitalises on the differences in price of the same stock in two separate markets. One market may be selling the stock lower than another. If this is the situation, Arbitration is used to buy at the lower price and sell on the other market at a higher price. These transactions take place at the same time to ensure that there’s no change in price after the stock has been purchased at the lower price.
Trading online on News
For those who keep an eye on current events, Trading online on News could be a lucrative way to profit from the latest news stories. However, this can be a risky way to invest so you do need to have up-to-date facts and research the area the news is related to. This strategy simply involves profiting from changes in prices of financial instruments that are affected by certain news events. The whole process normally takes place over the course of a single day, so it’s not usually a long term strategy each time you decide to Trade the News.
Trading has never been as easy to do and more strategies emerge as time goes by. These are five of those trading strategies that you may not have considered until now.