New spread bettors are susceptible to make a few very common errors in spread betting. Of course, from time to time, every trader makes mistakes, but new traders naturally appear to make more.

This is particularly troublesome because new spread bettors are likely to have much less ability:

-To tolerate substantial financial setbacks, and

-To recover quickly from a series of losing bets

Therefore, if you can manage to avoid the most popular newcomer errors as a new spread bettor, that will greatly improve your chances over the long term of becoming a profitable and successful spread bettor.

In fact, just being conscious that at the beginning of your career you will be more likely to make mistakes as a spread bettor gives you a big advantage over other inexperienced spread bettors.

Here are five of the most common mistakes in spread betting made by new spread bettors. It is worth noting that among inexperienced financial traders of any sort, these errors are widespread.

Mistake 1: Failure to create a solid trading plan

This is one that’s simple.

Do not make the common mistake of just jumping into the stock markets, just because you think, well, they could work out, making random bets. It is well worth the time and effort to learn about trading and build a solid trading plan before you ever risk your money-a strategy with which you can approach financial spread betting.

This involves topics such as determining what strategy or fundamental approach you will use to evaluate market opportunities and enter a trade, deciding on the size of your original betting stake, and clear guidance on what price points you will enter and exit each trade at. That’s the tactic used by seasoned, active traders.

Unfortunately, the path that new spread bettors frequently take is either failing to have a trading plan or failing to adhere to their trading plan, making unwise steps such as unexpectedly abandoning their strategy and changing their position in the market if the market moves a few points against them. Two losing bets usually result in that sort of move.

Mistake 2: Trading too frequently

The impatience stems from another common error of new spread bettors. Traders new to financial spread betting are vulnerable to making the error of betting far too much. They are eager to start making money, and they decide to just “take a flyer” on something rather than waiting for a nice, solid chance to make a bet in line with their trading strategy.

This is almost a sure-fire way for money to be lost. Experienced spread bettors realize that there will still be plenty of good possibilities to make a lucrative bet, but right now there might not be any of those possibilities available. Or even during one unique trading day at any time.

When they do not see any genuinely successful betting opportunities, they have the self-discipline to refrain from trading.

They are happy to stand apart from the markets and simply do nothing, even though they see no promising betting prospects in the space of many hours, or even for an entire trading day. They are preserving their capital for the next time a golden opportunity occurs by taking that route.

New spread bettors, on the other hand, get uncomfortable sitting and watching a trading board where nothing in the market ever happens.

Without making a bet, they have trouble letting any substantial amount of time pass, far less going through an entire trading day without doing so. Almost always, such impatience leads to poor betting decisions, and such bad choices rarely result in bets being won.

Mistake 3 : Failing to cut your losses

More than one smart trader has made the observation that a solid gold winner that returns you a huge profit will eventually come along if you can simply manage to avoid losing your money.

Unfortunately, many spread bettors new to the game have lost much, or all, of their trading resources by the time such an opportunity to make a big winning spread bet materialises, and are thus not in a position to take advantage of the very great opportunity.

It is important for good spread betting to cut short your losses and thus maintain your betting resources and the opportunity to make further bets in the future.

With the use of stop-loss orders that strictly restrict the amount of money that you lose on each bet, the best way to protect your trading capital is. It leaves you in a position to continue making potentially winning bets by wisely minimizing your losses.

The fact that you are likely to have not only occasional losing trades, but occasional strings of several losing trades in a row is necessary to understand and embrace.

The solution to that dilemma is to treat how much you bet and lose on each individual spread bet carefully so that you can tolerate a series of small losing trades and still have plenty of money to bet on.

Mistake 4: Adding to a losing bet

This is one of the most common trading errors committed by financial traders all over the world, but it is especially common among new traders. Do not make it harder to lose spread bets by adding to them and making them larger.

By simply accepting the fact that you were wrong on this one bet in your analysis and that it cost you a small but entirely manageable sum of money, you would do much better. Go on to the next successful betting opportunity and congratulate yourself on doing a great job of managing your betting money.

Mistake 5 : Chasing a missed opportunity

A common mistake for new spread bettors is pursuing betting opportunities that have come and gone already. Typically, this type of error happens while you are thinking about placing a bet. Another common mistake that generally stems from inexperience and impatience is this. The basic reality of trading that they can not capture every market opportunity that rolls along is understood by more seasoned traders.

If one passes them by, of course, they regret losing out, but instead of foolishly pursuing a sector that has already made its move, they are pleased with the fact that in the future there will still be more excellent betting possibilities.

Summary

Knowing the kind of mistakes that new spread bettors most often make will help you avoid them, and that will help you avoid unnecessarily losing money.

When you first start out with spread betting, it’s prudent to be careful.

It is more likely that your betting ability will grow with time. The best direction you can take is to make sure that with your capital intact, and maybe even some gains, you at least survive your “beginning spread bettor” process. Keep aware of, and thus escape from, common betting pitfalls.