Is there a possibility of becoming consistently profitable in trading CFDs? Why is it that other traders tend to achieve this goal very easily while others cannot get things right even after countless attempts? What they didn’t know is that the error boils down to human mistakes.

Warren Buffet once said: “I really believe it's better to learn from other people's mistakes as much as possible.” Being able to be called successful doesn’t mean that you should become the next George Soros or Warren Buffet. There is no such thing as the exact recipe to success in CFD trading. Like any other pursuits in life, you also need to have the right attitude and follow the process when you trade CFD. Check out these mistakes that shouldn’t be made in trading.

When you fail to have a trading plan

CFD trading should be treated like a business. When you get into a business, you give in all your time and effort to succeed. You will make a business plan even though it means you’ll be able to give up more time to think and conceptualize the content of your plan. If you are determined to make your capital grow, you have to plan your moves and think of the things that you should do to become profitable.

A trading plan shouldn’t be complicated. But it should follow these things;

1. What are the markets that you will trade?
2. What is your preferred time of the day to trade?
3. How long should you hold your trades?
4. What is your risk appetite?
5. What is your preferred trading setup?

When you fail to follow your trading plan

You may have a trading plan but you are not following it, you will end up wasting your time and effort creating the trading plan. As much as possible, you should create a trading plan that you can easily follow. There is no need to have a complicated trading plan. What you need is a comprehensive trading plan that states all your plans and strategies for your long-term success.

When You Overtrading

There are complications when you trade too much. But how many trades are considered too much? The answer to this goes back to your trading plan. But the most important reminder for every trader is – trade only when the opportunity strikes and if your money management permits you to do it.

When You Trading Without Stop Loss

Although you cannot fully remove the risks of trading, you can use several ways to protect your trading capital. Using a stop loss is necessary but you also need to know when you should cut your losses. This is why you should have a trading plan that can assist you in your trading decisions. It is appropriate to know when to enter or exit a trade because this determines your wins or losses.

Overleveraging

Leverage is one of the advantages of trading CFDs. However, if you overuse it, it will backfire on you. As you take a greater leverage ratio, you are also taking more risks. For newbies in trading, it is more appropriate to stay low and increase your leverage ratio as you go on.