If let’s say you are just looking at one single market and you only trade stocks or hold positions in one single market. What happens if something happens to this particular market? Okay, Let’s say if you trade US stock only and Trump decide to say something or whatever and then the US market crash, it is a high possibility that all your positions could all be stopped up at the same time because of one single event or because of one single issue in one single market. Okay? So the thing is once you dive, you are able to diversify your positions across different markets, across different instruments. What happens, to one market will not cause your other positions to be affected. So this is how you can prevent yourself from having losing streaks or having multiple positions all being stopped up at the same time, which can be devastating to your trading account as well as your psychology.

So, we did practical consideration. The best thing is to diversify across different market, different instruments, okay. But if you find that it is too tough for you to do that, if you can, if you can only focus on one single market like, for those of you guys who are based in India, my suggestion is make sure your watchlist condense issues or stocks from the different sectors. Okay? Don’t keep on focusing on one single sector that all the bank stocks or the property developer stocks. If you can focus only on one single market, try to look across all the different sectors.

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Philip Teo

Founder & CEO at Traderwave Pte Ltd
Philip Teo is an entrepreneur, speaker and trading coach who specialises in the field of Technical Analysis of the financial markets. He is currently the Founder and CEO of Traderwave Pte Ltd, a financial technology company that offers a web charting application to global traders. He has conducted many trading seminars and appeared on national television before. He is also currently an official speaker and trainer with SGX Academy. Learn more about him at his Google+ Profile, LinkedIn Profile and Facebook Profile

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