HFM information and reviews
HFM
96%
OctaFX information and reviews
OctaFX
94%
XM information and reviews
XM
93%
FXCC information and reviews
FXCC
92%
FxPro information and reviews
FxPro
89%
FXCM information and reviews
FXCM
87%

3 Tips on How to Take Advantage of Volatile Markets


What’s your first reaction when market prices suddenly go tumbling down or climb up? Do you start to worry or do you calmly think it through and act based on your trading strategy? In any case, as a trader, you’ve probably experienced market volatility in a number of situations. Online trading comes with the uncertainty of price fluctuations and this is what keeps traders on the edge of their seats.

If you’re wondering whether there are any ways to help you feel more confident and reassured in times of high volatility, keep reading below!

 What is Volatility?

In a short period of time, volatility measures the tendency of a market or security to rise or fall sharply. Typically, it is defined as the standard deviation of an investment's return over a specified time period. Investing in different types of assets will have different volatility depending on how much and how often their prices or returns move over time. Price fluctuations and heavy trading are common characteristics of volatile markets. This happens when there is an imbalance in trade orders in one direction. The volatility of the market usually rises when investors are fearful or uncertain. Economic downturns, geopolitical events or natural disasters can cause this kind of downturn. In 2008-09, for instance, the credit crisis contributed to higher market volatility. In addition, the market volatility spiked in 2022.

3 Tips on How to Take Advantage of Volatile Markets

What Can You Do?

Risk Management

Traders should always be aware of the risk entailed in online trading. Just as huge profits may arise, unexpected losses are also part of CFD trading. However, this does not mean that you should just sit back and remain inactive when things go sideways. Risk management is all about carefully considering your trading positions, your entries and exit points, and the funds you are willing to risk. Especially in volatile markets, risk management can prove to be one of the most fundamental strategies for every trader. In this way, even if any unexpected price changes occur, you will have already prepared your exit strategy and your next move.

Remember your Ultimate Trading Plan

When you first created a trading account, you probably had a specific goal in mind that you wanted to achieve in a certain period of time. This is the ultimate trading plan that guides you throughout your trading journey and keeps you disciplined when challenges arise. As your trading positions could be affected by a variety of factors, such as global economic events, it’s important to think back to your trading plan. This can help you look at the situation more clearly and then help you decide your next move more effectively. What’s also essential to remember is that your trading plan will keep you motivated as every day you will want to be one step closer to making your trading goals a reality.

Stay Ahead of the Markets

How can you stay one step ahead of the ever-changing financial markets? By practising and educating yourself on a daily basis. If you truly want to become the trader you aspire to be, you need to put all your efforts into boosting your trading skills and knowledge. In this way, you will be better prepared to handle any challenge that comes your way. It is also essential that traders stay on top of every economic event that could impact their trading positions, as fundamental analysis is vital when it comes to analyzing and understanding price movements.

Are you ready to face the markets? Log in to your XPro Markets account and discover all the tools and resources you need to conquer the volatile markets and discover some of the most trending CFDs out there! 

Risk Warning: Contracts for Difference (‘CFDs’) are complex financial products, with speculative character, the trading of which involves significant risks of loss of capital. 
Disclaimer: This material is considered a marketing communication and does not contain, and should not be construed as containing investing advice or a recommendation, or an offer of or solicitation for any transactions in financial instruments or a guarantee or a prediction of future performance. Past performance is not a guarantee of or prediction of future performance.
#source

Share: Tweet this or Share on Facebook


Related

Delving into the Webs of Influence: Dissecting the Role of Past Performances in Sculpting Future Achievements
Delving into the Webs of Influence: Dissecting the Role of Past Performances in Sculpting Future Achievements

In the continuously evolving sphere of human endeavors, the relentless quest to decipher whether the footprints of past performances imprint on the sands of future successes remains a focal fascination among scholars, analysts, and industrial protagonists...

Understanding Forex Hedging: A Comprehensive Guide
Understanding Forex Hedging: A Comprehensive Guide

Forex hedging is a risk management strategy that aims to reduce or eliminate the potential risks associated with financial transactions. It has evolved into a profitable trading strategy for some traders...

Forex Hedging: Shielding Your Business from Foreign Currency Risk
Forex Hedging: Shielding Your Business from Foreign Currency Risk

Forex hedging stands as a cornerstone of currency risk management, a strategic shield that businesses employ to safeguard themselves against losses arising from the unpredictable fluctuations in foreign exchange rates. In essence, it involves the acquisition of financial instruments or products to shield an enterprise from unforeseen shifts in exchange rates.

Unlocking the World of Commodities: An In-Depth Exploration
Unlocking the World of Commodities: An In-Depth Exploration

Commodity markets have often been portrayed as a realm for high-risk individuals, and while there's some historical accuracy in that depiction, the reality is that nearly every type of investor engages in commodity markets...

The Surge of High-Frequency Trading (HFT): Implications for Market Stability and Liquidity
The Surge of High-Frequency Trading (HFT): Implications for Market Stability and Liquidity

In the last decade, High-Frequency Trading (HFT) and Algorithmic Trading (AT) have emerged as dominant forces in the world of trading. In 2010, HFT accounted for 56% of all U.S. trades and 38% of European trades...

A Comprehensive Guide to Trading in Volatile Markets
A Comprehensive Guide to Trading in Volatile Markets

Trading in volatile markets can be a challenging yet rewarding endeavor. To navigate these turbulent waters successfully, it's crucial to understand the dynamics at play, and one of the key tools for doing so is the VIX...


Editors' Picks

MultiBank Group information and reviews
MultiBank Group
86%
Vantage information and reviews
Vantage
83%
FP Markets information and reviews
FP Markets
81%
Just2Trade information and reviews
Just2Trade
80%
AMarkets information and reviews
AMarkets
78%
IronFX information and reviews
IronFX
77%

© 2006-2023 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.