Investment Insights

Whether you are a seasoned investor or one of the many traders joining in recent times, you will know that the financial landscape is forever changing. A strategy which works perfectly well today may need to be updated tomorrow as markets move and different trends emerge. Successful investment traders accommodate several strategies, looking at ways to maximise the upside while limiting the downside. It is essential to be flexible and forward-thinking, admit if you are wrong and move on!

As a day trader, there is potential to make significant long-term returns. Indeed, many people trade stocks for a living. However, as with any type of investment, day traders must be able to identify the risk/reward ratio of each investment, with risk management critical to long-term success. In this article, we will look at the principles of risk management that every day trader should understand and implement.

While online trading is second nature to many investors, there is an assumption that the psychology of a stock market trader today is the same as that of 10 years ago, 20 years ago and further back. The reality is that the stock market is an ever-changing beast, and with these changes comes the need for investors and traders to adapt their psychology. As we work through the various changes in psychology, it will all become apparent.

While many seek to be a professional investor, what does it take? More to the point, when do you know when you’ve achieved that status? A professional investor is someone who invests/trades for a living. This is a dream for many people, a nightmare for some, while achievable for very few. So where do we start?

You will often hear the term wealth management, which tends to be associated with relatively high net-worth individuals. At first glance, it is not automatically clear what services a wealth management company would offer. However, if you dig a little deeper, this industry provides a vast range of services.

While anyone can do online trading, specific personality traits are required to be a successful day trader. Often portrayed as an exciting carefree profession, being a day trader is one of the most volatile investment activities you will encounter. What may look like a haphazard approach to investment is, in fact, extraordinarily disciplined and structured. Perhaps the ability to switch between investments in a split second gives this undisciplined overview.

Many articles have been written about the psychology of trading, but sometimes it is interesting to hear thoughts and views from the horse’s mouth. For example, a recent survey on the Newtraderu website gives a fascinating insight into the actual beliefs of professional traders and what they believe impacts their trading activities.

We live in a world where technology touches all areas of our financial lives, from wealth management to banking, investment to insurance and beyond. While FinTech covers the broader financial technology sector, subsectors are now emerging, such as WealthTech and RegTech, to name but two. Focusing on WealthTech, what are the long-term benefits and how does this enhance wealth?

We have seen considerable developments in online tradingtechnology over the last 20 years. As an online trader, dealing from the comfort of your home, the markets and the investment options available today have never been broader. There are five basic stock trading strategies used by many online traders, often adapted for their particular goals.

As an online trader, it is essential to appreciate the importance of psychology in online trading. There is nothing wrong with feeling various emotions as you are trading; indeed, as an online trader, they can be helpful, but they must not rule your head. We will now look at the challenges of online trading in relation to psychology and how to remain in control.