Futures Trading 2018: What is it & How to Trade | Beginners Guide

The Futures trading can be defined as a contract between two parties (buyer and seller), to buy and sell a particular asset at a fixed price and on a very specific date. Though a trading trend today, futures contracts were created to aid farmers when crop prices fluctuated, during the period between planting and harvesting. This grew into a trend for traders to speculate on and predict an asset's profit/loss. 

What are Futures Trading?

Futures are essentially a derivative - their value is derived from another commodity's price movements. Only the instrument's price will affect the value of a derivative, and it doesn't have an inherent value by default. Futures can be traded by anticipating the instrument's price movements. This is done by going long (buying) or going short (selling). Several traders speculate on this rise/fall and try to profit from the changing price of the contract. Right from eggs, to precious metals - futures contracts exist for several commodities! 

How to do Futures Trading in Vietnam

Futures are unlike other financial assets, solely because of their lack of inherent value. Additionally, a particular commodity can't be speculated for a long time because each futures contract has an expiration date. This makes futures trading a very sophisticated and volatile field to delve in. 

Basics of Futures Trading in 2018:

Futures trading are more than just a means to hedge; it is a provision to speculate on financial assets. The risks involved are very high - while the profits you make might just put you at a breakeven position, the losses will leave you tumbling! Intense amounts of research are required to ensure a healthy trade in futures. Several traders consider taking help from a professional broker when it comes to futures, because of the immense risks involved and the high levels of precision needed to avoid losses.

While trading futures, there is always an underlying element of risk. The second you decide to take a risk, you must be ready to sacrifice all your investments! It has happened on one too many occasions where the losses suffered were more than the investments put in. Futures brokers provide leverage, since buying a commodity is not financially doable; this leverage can be your downfall if you don't trade carefully! Only trade with your risk capital. Incurring leveraged losses will leave you drained of funds in no time! Only utilize money that you can afford to risk losing. 

Tips for Trading Futures in 2018:

1) Study the Asset Completely: The crux of futures trading lies in understanding the underlying asset completely. Traders fail to realize it isn't just the asset that's on the line; it's the accompanying factors as well! Handpick the instruments/commodities you think will move as you predict, then go on to study the factors that affect its movements. For example, if you're a wheat futures trader, just knowing the harvest duration won't help. You must know who the prominent wheat-buyers are, how the weather affects the crop market and the price patterns of all previous years. These are some of the various governing factors for a crop. Similarly, for other commodities, observe and research on the factors that will affect its presence in the market and govern how long it is on the top. 

2) Move on Your Own: Futures trading may look hard to conduct, but with ample research, you can definitely profit! Trading independently has a number of advantages; you can trade at your time, devise your own trading strategy, and other than the facilitation fee, there won't be a dime to pay anyone! However, this requires immense responsibility and attentiveness to pull off. Right from managing funds, to researching, to devising a strong plan - the entire ordeal will have to be handled by you and you alone! This hasn't prevented traders from pursuing it. Several traders are solo players in futures and are more than just successful at it.

3) Implement Stop-losses: Futures holds a lot of liquidity, which will work against you in no time. Profits always look attractive from the distance, but the closer you go the more you realize - the path to profiting in futures is laden with risks! Several traders choose to stick to losing positions out of pride, or hoping that the market will turn in their favor! Avoid such careless acts. An amazing way to keep losses in check without pressurizing yourself each minute is by implementing a stop-loss before hand. Stop-losses are mechanisms that are hugely beneficial in trading. Implementing a stop-loss will automatically withdraw your position once a losing trend is spotted or a certain loss amount is met. Risk management and loss minimization make up a huge part of your trading strategy.

Futures are a highly lucrative field with immense prospects of profits. However, the volatile nature of futures ecosystem makes it very liable! Assisted by WesternFX - the best at futures trading in Vietnam, you will not just learn, but excel in your ventures! Call us today to hire us.

Know Where to Balance in Trading

Knowing what steps to follow and omit will provide a good trading opportunity. This article discusses various ways that parity can be obtained while carrying out exchanges.

Trading is not a piece of cake. Everyone who does that wants to make a profit, yet most of the time they incur more loss than they expect. Central banks, technical indicators, data releases and economic news are some of the factors that influence the Forex market. By simplifying things that are more complicated, we end up being a victim.

Trusting Ourselves Too Much

When a person starts to trade they will probably end up failing at the initial stage. Most of them fail when they start their first account. Once we learn certain Forex trading strategies and techniques, we end up implementing it and succeed. As soon as the account starts to grow, our confidence increase and work like experienced traders. Even hedge fund managers and prominent traders lose. So, there are chances of losing an exchange or an account. To ensure that we trade consistently with profit, we should not succumb to greed.

Believing Trading Strategies Blindly

Many Forex trading strategies exist but not all prove to be successful. New techniques are being posted often in Forex trading forums. Even though those approaches seem to work at the start, they eventually fail at the end.  Following a strategy can only help to a certain level, as only having a proper understanding of the market will aid in futures trading.

Forex Trading

Opting Unique Approach

Renowned Forex blogs constantly provide concepts and analysis that are not easy to grasp. No two traders will come to the same conclusion regarding such approaches. Since markets generally follow the majority, unless we are hedge fund managers or central bankers, the market won’t go in the direction that we expect. Including indicators and strategies will complicate the chart and confuse the traders. Handling Forex market will be effortless if it is kept simple.

Stop Overtrading

Do not trade in all the opportunities that you get. If the specifications of the market are not clear or when you do not know what to trade on, it would be wise not to carry on. When you overtrade, you often become paranoid and mess up your entries. 

There are no set rules when it comes to futures trading. It is important that we stop making it difficult by including strategies and techniques and find that perfect balance.

The aforementioned steps will allow traders to attain that balance in online trading. For online traders in Vietnam, these measures will help in perfecting your balance and reach your financial goals. Partnering with reputed online brokers in Vietnam like WesternFX will ease up the process of trading.

5 Habits you can Inculcate from Seasoned Forex Traders

There’s no such thing as guaranteed success in the Forex market. Yes, there are plenty of opportunities for wins, but how you get there is the hardest part. You might load yourself up with knowledge, have an excellent game plan and have all the resources you need to trade. But that’s not everything! Your attitude, habits, and mindset can also determine how your performance shapes up in the Forex market. Successful traders stay focused, build a positive aura,   keep refining their strategy and remain persistent.

If you want to join the ranks of big-time traders, here are five habits you can derive from them and step up your trading game:

1)    Knowing you will fail

Success and failure are a part of trading, and one can never expect trades to always swing in their favor. One of the most harmful beliefs you can nurture is the notion that failing once means that you’ll fail always. Even experts lose money, but they wait it out, find the perfect opportunity and bounce right back.

2)    Developing a healthy routine

By ‘healthy,' we aren’t just referring to a good trading routine, but also to your overall health and well-being. Inculcate healthy personal habits. Stay fit, eat well and get to work. Excellent physical and mental health will reflect in your trading performance in a positive manner.

3)    Limiting exposure

We’ve got day traders, swing traders, position traders, and scalpers who specialize in trading over specific time frames. The problem with beginners is that they want to do it all and simply cannot stop over-analyzing the market. Seasoned traders limit their exposure to the market. Identify which markets you’re interested in, take it slow, and make a conscious effort to limit market exposure.

4)    Be disciplined not addicted

You need to develop the discipline and patience it takes to watch the charts and make moves in the market. There’s a fine line between exercising discipline and addiction, and most traders fail to see that. Professional traders follow a prescribed plan and enjoy trading. Do not turn into an addict and make ‘bad’ trades.

5)    The drive to learn more

No matter what you’ve achieved, you can never know it all. Learning is a continuous process, whether it’s about Forex trading or yourself. Learn from your mistakes, refine your strategy, adopt new things and do not be afraid to experiment. That’s the only way you can grow – both as a trader and as a person.

While this is by no means an expansive list of habits observed by professional traders, it does offer a glimpse into the level of dedication and commitment shown by seasoned Forex traders. Etch out a similar identity for yourself. Start your trading journey with WesternFX today!

What Beginners Must Do to Get Started After Demo Trading?

After finishing training on a Forex demo account, there are a few steps that a beginner needs to take to have his live account opened and funded. In this article, we’re going to be discussing what a novice must do to get his trading game set-up and started. 

Identifying a broker

The first step you must take is deciding which broker to engage with. The broker is your conduit to the trading realm, and controls your live account. The broker you hire for live trading may or may not be the one which gave you your practice account. The ideal beginner usually has a try with multiple brokers’ demo environments to get familiar with the advantages and drawbacks of each. One must keep in mind that if a brokers’ Forex demo platform is not as ideal as needed, it is not to be automatically taken that the same would happen with a live account as well. 

There are a few questions one must ask when finding a Forex broker in Vietnam. 

1) Does the broker have experience and credibility? 

2) Does the broker’s financial capacity suffice for your trading needs? 

3) Does the broker appear honest and trustworthy? 

4) Does the broker have an established support system that you can depend on during turbulent periods in the trading day? 

5) Does the broker offer leverage and spread capacity that satisfies you? 

These are some of the basic questions that one needs to ask himself when evaluating a particular broker. After choosing your broker, you would need to complete some basic formalities, including filling a form and submitting your identification. 

Depositing money in the account

After completing the formalities, the brokerage would assign you an account with a username and password. You would be given basic instructions regarding the usage and various options that exist for the account. There are different ways one can transfer money into the account, with credit/debit cards being perhaps the easiest mediums. After having your initial amount deposited, adding further levels of funds into the account can be done in the same manner. 

Beginning your trading

Usually, the broker would notify you after having received the minimum fund deposit. It could be through email or other means. After this, you can begin trading in the live stage immediately. An important thing to remember at this point is to withdraw money from your account. The broker would provide instructions on how this is done, and a client could read this from his website. 

If you need further assistance with the tenets of online trading, then get in touch with a leading brokerage in Vietnam. WesternFX has been in this scene for quite some time now, with clients across the continents. We can improve your performance, make more room for profits, and add value to the business of Forex trading.