Trading In Volatile Markets A High Risk Strategy

Online, August 6, 2013 (Newswire.com) - Trading education and resource site Independent Investor has urged traders to demonstrate caution ahead of trading in volatile markets, warning that the risks of trading in volatile conditions are significantly greater than normal, and the threat to capital integrity even more present than in less volatile trades.

Volatility is the degree to which a market moves over a set period of time, with markets the swing more violently considered more volatile. While volatility presents opportunities for generating increased returns, it also poses a more considerable risk of leveraged losses, which can damage capital and hamper future trading success.

Traders should therefore be mindful of trading in volatile conditions, and should take measures to cater to the additional risks posed by trading of this type, according to IndependentInvestor.co.uk.

A spokesperson for IndependentInvestor.co.uk suggested that traders who are more proactive in managing their risks and protecting capital were likely to benefit from better aggregate trading performance, and urged spread bettors to factor in volatility as a more considerable factor in gauging the degree and severity of risk in each position.

"Volatile markets can be something of a mixed blessing for spread bettors (read more spread betting tips). While they can help yield a substantial return over a short period of time, they can also cause equally substantial losses, and for leveraged traders that can quickly spell trouble. Trading in high volatile markets may be viable, but it's absolutely essential that you take steps to counter the risk and protect your capital in high volatility trading environments, in order to leverage your investments to their fullest potential. Only by protecting the downside can you build a platform for attacking the markets for profit."

"At IndependentInvestor.co.uk, we're happy to discuss strategy and approaches for trading in high risk scenarios with our traders. As part of our commitment to helping make the financial markets more accessible, we provide resources and materials examining how traders can most effectively cover risks and prevent the potential capital damage trading with leverage in highly volatile markets can bring."

About:
IndependentInvestor.co.uk is an online investment education site, dedicated to helping inform traders of how they can improve their levels of success in trading on spread betting markets. Aimed at traders who are looking to become more efficient and more profitable in trading their capital, as well as those that are starting out for the first time, IndependentInvestor.co.uk provides accessible, non-jargon intense materials that traders can implement immediately for improved trading results.
Alongside educational materials and resources, IndependentInvestor.co.uk provides the chance for traders to compare different brokers and their services, in order to identify the most competitive spreads on the most commonly traded financial spread betting markets.