Five years on from learning to trade with Amplify Trading, Head of Market Analysis, Anthony Cheung caught up with Ben, to see how his trading has developed over the years. Ben also shares his best advice for anybody who is looking to begin trading, below. Anthony provides some details on Amplify's processes on the points raised by Ben throughout.
'Developing discipline is key to trading. I recommend creating a really strict set of parameters and rules when trading – never do an impulse trade! You have a 50/50 chance of success - but unfortunately - they almost never work, and even if they do, you should see it as a bad trade – it was taking a punt.'
New traders always ask what the one necessary skill is to become a successful trader. The answer? Discipline.
With the right training and guidance, the fundamental and technical aspects of trading can be learnt with time. However, an ability to remain disciplined and act in accordance to a predetermined and well thought out plan is a daily challenge to all traders, regardless of experience. It is this psychological factor that will ultimately determine those who succeed and those who fail.
‘Have a clear plan of what you’re doing, a set of rules is recommended for when you’re trading. If you break your set of rules you will lose money.’
The team at Amplify Trading follow a strict process; every trade starts with fundamental analysis to determine the main trade in play and direction of the asset in question. Once this step is complete, technical analysis is then applied to craft the specific framework of the trade, to maximise profit potential but keep risk to a calculated minimum. Then comes the hard part - execution.
This is where patience and discipline are key. Once out of the trade, a thorough audit of the trade is done in order to fine tune performance from the data gathered over time. For us, the quest to become a better trader never stops.
‘Trading to pay for your mortgage? Don’t do it! You shouldn’t trade for the wrong reasons – unfortunately if you do, it is very likely to result in costing you an awful lot of money.’
Becoming a successful trader is highly dependent on being able to manage and respond correctly to your emotions. It is not recommended for people to take this profession up unless they have adequate time and financial freedom to apply themselves in the correct manner. Trading is no different from any other profession in that you improve with experience - there are no short cuts in trading, as in life!
Find the style of trading that suits you, and a market that suits you is key.
'I trade futures – I trade oil and gold very well, for the life of me I cannot trade bonds. I’m not here as a thrill seeker, I’m here to earn some corn.’
This is an important point; different products have different characteristics. Knowing who you are and how you trade has a direct impact on the products you will likely trade best.
A perfect example is the Amplify Trading co-founders, Will and Piers. Will is an outright activist, so inherently he likes to trade more volatile assets such as the German DAX or WTI Crude futures. Whereas Piers is much more pragmatic, and a theorist, and therefore thrives in trading slower moving markets like US Treasuries or German bunds. The key here is being honest with yourself and understanding how you operate, and then sticking to your strengths.
'The only reason you have wisdom in later life, is that you’ve made every mistake in life'
To quote a famous phrase from one of the world’s greatest sportsman, Michael Jordan, “I've missed more than 9000 shots in my career. I've lost almost 300 games. 26 times, I've been trusted to take the game-winning shot and missed. I've failed over and over and over again in my life, and that is why I succeed”.
Could Ben’s advice help you learn a trick or two about trading? Watch the full interview.
Watch the full BBC documentary, here.
Join the Amplify Trading team for an intensive five day training programme on 23 September. This covers fundamental analysis, technical strategies and an in-depth understanding of behavioural finance and your trading psychology.
Get in touch with Anthony to arrange a call and find out more about our upcoming courses.