Starting up trading with no experience is not without its difficulties, especially during this challenging time. It takes a lot of time, effort, and knowledge to make it work.
How you fare at trading depends on how you ruminate on trading, what sort of profits/returns you are looking at, and how much risk you are willing to take.
Consequently, you can devise your own strategies and goals, and achieve them to make the most optimal profits.
Traders who want to start their first trading will be glad to learn there are a variety of styles and strategies tailored for certain personalities. Here are a few trading styles you can experiment with based on your personality:
Day Trading
This type of trader focuses primarily on starting and completing tasks on the same day. That’s you if you prefer taking one trade a day and closing it before the day ends even if that means staying up until late at night.
Generally, day trading is classified as a short-term trading style due to its nature – the intention of gaining returns from small price movements.
You might be apt for the day trading style if you are persistent. A strong day trader is persistent as they like sticking to a certain style/strategy when it works for them.
Discipline - day traders can manage their plan of how they approach their trading and what they do during market hours. They have a strict schedule to follow every single day without fail.
Also, it is important for day traders to be sharp as day trading is known as the game of minutes. Traders can’t afford to be pensive or apprehensive as they must act quickly when they see the opportunity.
Position Trading
A position trader specializes in having a long-term outlook even it means days, months, or years. Thus, it is known as a long-term strategy mainly focused on fundamentals however, technical principles may come in handy as well.
If you lean more on position trading, ensure to comprehend how economic factors can affect markets and thorough technical understanding, is super important in predicting trading plans.
Patience is a virtue for position traders as they won’t make short term profits and you need to be extremely patient to achieve your profit goals. It is best suited for those who have already have a full-time job and not wanting to be worried about price fluctuations every single day. The goal for this trader is to make profits in a long run. That means you enjoy more delayed gratification over instant gratifications.
Swing Trading
Swing traders look at trading like gambling. They don’t mind waiting for the trade, but they make sure to hit the profit when they enter the trade even it means waiting for ages. Position traders look at the long-term view and play with fundamental analysis to determine whether a particular trade is profitable.
This type of trading is best suited for those who have a full-time job and are only able to do trading part-time. If you are a calm and collected person, this trading style suits you the best as you will be able to keep yourself calm while you are away from your device.
Swing traders must be cool-headed even though things aren’t going in their favor. Besides, patience is their second name as fellow swing traders must wait around to trade. Swing traders usually are meticulous and attentive – they are willing to take fewer trades but have a very good setup and strategies as they are super organized and up to date with the trends.
Scalping
Scalping is one of the most infamous strategies used in trading. An opportunistic trader, also known as a cyclical trader. While swing trader would wait and hit the bull’s eye, scalper would do that too but differs in the sense that they are fast-paced and opportunistic in identifying trends and price movements.
Scalpers always keep you at the edge of your seat – small opportunities are their aim. They are always quick and able to take precise decisions. Scalpers often focused on profits from small changes, and they enjoy intense concentration therefore they are also on the feet.
If you are short-fused, this is not for you as it is a risky process. It is so important to be level-headed as you can see you need to be always super focused. Scalpers are usually determined people as they can make decisions quickly, if you are indecisive or are prone to daydream, scalping is a no go.
Algorithmic Trader
This trading style is vastly different from the rest, algorithmic traders are primarily focused on technology, software, and technical tools. They don’t really investigate the fundamentals of trading, but rather try to profit from computing power and mathematical modules.
If you are someone attentive and observant, this works the best for you. With their observational skills, they will be able to optimize their returns. A successful algorithmic trader keeps themselves centered and often are realistic – as they take calculated risks and strategize their next step beforehand.
Their persistent attitude is their perk as they take a practical approach to trading, and they know when to avoid making trading decisions.
Momentum Trading
Momentum traders predominately sell or buy according to the strength of market price. They often focus on returns from trades that are moving up significantly. The goal is to find profits in short-term uptrends and sell when it starts losing momentum.
Usually, traders buy trades when they in low and sell them when they are high but that is not the case with Momentum traders – they buy when the price is high and sell it when it’s higher. Typically, momentum traders are highly focused and able to quickly identify the market trends.
If you are someone who tends to get distracted easily, this is not for you. Besides, these traders are often up to date and can absorb information in a short amount of time. They will be constantly monitoring and looking for signs of market movements as well as keeping abreast of the latest trends and development to capitalize on potential movements.
As you can see, trading styles are based on your traits and financial goals. Different styles suit different people; thus, it is important that you understand who you are and what styles suit you the best.
Don’t worry if none of these styles suits you as there are a plethora of styles and strategies out there – no one size fits all. Feel free to dive in and research various other styles that are mentioned above!
In Lirunex, we will help you to experiment with your trading styles and strategies that work best for you in the long run. As a trader, we help you to remain consistent with your trading styles, even if the performance lags. The constant experiments are the best way to catch every losing streak.
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