Why Can Financial Markets Trading At Home Be Problematic?
Trading at home is what many people want to do – it is convenient, flexible, and thanks to advances in technology it is something that everyone is able to do. However, there are some problems that home traders often come across when they start trading in this way. We’ll go into exactly what they are later in this article, but the point is that if you have come across issues when trading at home you are not alone. The good news is, these challenges can be surmounted.
photo/ Gerd Altmann
You Need The Right Environment
When it starts working well for you, you’ll only need around 10 minutes each day when you trade from home. However, even if you only trade for this short amount of time, you’ll still need an environment that is comfortable and quiet so that you can really concentrate.
Most of your trading time won’t be in front of a laptop or on a smartphone. Most of the time you will be looking at resources, creating plans, analysing markets, and learning as much as you can so that you can get better and better at what you do. Only a very small fraction of what you do when it comes to trading actually involves setting up the trades. This is why having a good environment to work in is important – just like with any kind of work, you need to be able to focus.
So what do you need to get your trading environment right?
- Privacy
No matter whether you are able to take an entire room to shut yourself away in or you need to have a desk in the corner of a bedroom or living room, or if you’re working at the kitchen table, you’ll need privacy. Ensure you can shut the door when you need to, even if the room is used for other things.
- Comfort
If you’re not comfortable in a room then, even if you don’t realise it, you won’t be at your best when you are working, no matter what that work might be. It could be a physical reaction to an uncomfortable chair or a desk that is too small or too low, or it could be a subconscious feeling that means you just can’t relax. Making the room comfortable is essential.
- Equipment
If you’re going to trade from home, one of the most frustrating problems that people come across is that their equipment and technology are just not up to the job. Their internet connection is too slow or they don’t have enough backup storage. Make sure that you have the right equipment in place before you start so that you can begin as you mean to go on. More info here.
Don’t Get Distracted
Distractions are a problem that everyone who works from home has to deal with. If you are out in an office somewhere, the fact that the laundry needs doing or the sheets need changing or the house should be vacuumed is not going to keep you from working.
When you’re at home, these distractions – and many, many more, especially if you don’t live alone – are all going to be vying for attention. So you’ll have work out what is best for you and how you are going to work through all the distractions.
Some home traders enjoy listening to music, or having the news on in the background. This stops them from having to trade in absolute silence, and if there is noise elsewhere in the house it will meld together and not be a distraction. As for the household chores, as irritating as they might be, you’ll need to wait until you’ve finished trading to get them done – the jobs aren’t going anywhere so they shouldn’t concern you.
Tax advantages
Some countries (ie: The United Kingdom) allow traders to trader under the banner of “Spread betting” which enables your winnings in the market to be free of capital gains tax (CTG) as this activity is classified as gambling (even though you should be trading with a proven strategy!). There is a downside to this and this is you are not able to offset and trading losses against tax. This is only recommended if you are consistently profitable. For more info, click here.
Conclusion
Trading at home might sound like a wonderful way of working, but it won’t be what works for everyone. Therefore, think carefully about whether it’s something that will work for you. In some countries
Author: Pankaj Deb
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