It's Absolutely Crucial to Keep an Eye on Economic Events When Trading the Financial Markets
LONDON -- (Marketwire)-- Every week, back-to-basics spread betting provider Finspreads put together an easily digestible economic calendar for just this purpose. Beginner traders are encouraged to spend a few minutes at the beginning of each session to identify key events for the day, and pick out any economic event that may move the financial markets.
To help along the way, Finspreads also identify the big risk events which are likely to result in market volatility and price spikes. The events are clearly marked with red and orange stars, which denote the big market movers and those which warrant a little extra caution respectively.
Using the calendar, traders can plan their trading strategies well in advance and get into position before the market moves. Of course, it's also a reasonable strategy to stay out of any trading positions until the market has calmed down and has begun to settle into a trend, but this will depend on the strategy of the individual trader.
Two events that are normally guaranteed to cause market volatility are the US Non-farm Payrolls, and the release of GDP data. Both of these events are good examples of economic data releases that indicate the overall health of a nation's economy. They pose a potentially risky time to be spread betting currency pairs involving that particular nation's currency, but the outcome of the events may also have an impact on index prices and commodities too.
It's always best to prepared for any outcome. Traders with Finspreads can prepare themselves by taking advantage of the Limited Risk Account, which ensures they will not lose more than their initial capital deposit. Once they've learnt the way the markets move, they can gradually wean off the Guaranteed Stop Loss Orders and up their sizes, but should still exercise a healthy degree of caution.
Spread betting carries a high level of risk to your capital with the possibility of losing more than your initial investment and may not be suitable for all investors. Ensure you fully understand the risks involved and seek independent advice if necessary.