Making investment decisions based on emotional circumstance instead of risk/reward and reasoned logic is an avoidable cost. If you are unable to focus on making a clear-headed decision, it is best to avoid trading altogether; however being aware of your own emotions can be difficult. At times when you are in a disturbed mood, due to any reason, your judgment will be poor and you may end up making poor trading decisions, which will further effect you emotionally.
It’s not uncommon for amateur spread bettors who are experiencing a losing streak, to attempt to break even by placing highly risky trades. While it is natural to become impatient following a streak of losses, it is important to be self-aware and self-critical of any decisions made based on emotions. Here are a few ways to help manage situations like this:
First of all, remember that spread betting comes with risks. Losing or profiting cannot be guaranteed, and you should be prepared to handle both objectively.
Be sure to have a clear idea about the markets that you are dealing with and the factors that effect its performance. Spend some time reading up on technical charts and reports to understand the historical performance of the market. In short, be prepared for the markets that you are venturing into.
Considering the above and the risk/reward ratios, make a trading plan and follow it to the letter.
Financial spread betting is not your game if you don’t have the patience for it. Only when you can spare the time and energy to understand and apply the strategies, while accepting the risks that come along, will you be able to minimise your losses and improve gains.