Whether you are a novice day trader or a seasoned trader, chances are you may have experienced the opportunity to use a trading room and may not be equipped with the information about the pros and cons so that you can make an informed decision on participating. In this article, we will explore the good and bad points of using a trading room for development purposes and uncover some ideas on how to make the most of being a part of a trading room.
First thing first..
What exactly is a futures trading room?
In the world of FOREX, Stocks, and Futures trading, there are resources available to budding traders and seasoned pros alike that are all designed to provide you with an added edge when it comes to successful exaction of trades in any market. One of these resources comes in the form of fully interactive trading rooms where you can benefit from the decades of experience gained by seasoned traders and gives you a chance to make real-time trades in a somewhat controlled environment.
From a novice’s point of view, having the experience and knowledge of a trader who has been in the business for years is truly invaluable. These traders have seen it all and through their guidance and teaching, you stand to pick up far than you would have alone and you will become a better trader as a result of their teachings. As a seasoned trader, you still have an opportunity to compare notes with someone else who is equally experienced and perhaps learn something new when it comes to executing difficult trades or staying ahead of smart money trade decisions and improving your overall successful trade ratio. Either way, more heads are better than one and the best way to learn is through doing alongside some of the experienced people in the business.
So now that we have had a look at the basics, let’s explore the some of the advantages you can enjoy by being a part of a trader community where you can brush up on your existing skills or learn some new ones.
What are the advantages of using a futures trading room?
Wealth of experience from other traders
By being a part of an experienced trading community and working in either a virtual environment or a live trading environment, you can enjoy trading futures without the pressure involved in trading solo. The likelihood of the moderator experiencing a wide range of issues and coming through the other side unscathed are quite high and you stand to gain a huge amount of knowledge from people who have been there and seen it all.
In the trading room, you also have an opportunity to chat in real time to other traders who are executing similar trades and easily notice developing trades as they are happening.
Benefit from trading in a controlled environment
Most trading rooms offer both live and controlled versions of a trading environment and these options are great for traders who are just starting out because they are free to make trades without staking money and get a feel for how everything works.
For more experienced traders, you have the ability to trade alongside other experienced traders and ask questions or receive helpful tips on how to trade more effectively. A controlled futures trading environment also provides the trader the freedom to take chances and test the market without losing substantial amounts of money in the process.
Trading rooms can double as a fantastic social gathering
If you are a regular member of Futures trading rooms or lounges, you will be aware of the level of communication that goes on in these rooms and may have taken part in some serious conversations around the best choice to make and thoroughly discussed the market. Some rooms offer both live chat and video/audio chat platforms which enhances the traders experience and allows you to engage fully with qualified and licensed traders.
Feel free to ask questions, discuss market conditions and celebrate massive trades that are executed perfectly. These chat functions also provide an excellent way to learn for novice traders and puts the trader at ease in the knowledge that someone is available to talk to if you need to.
There are a few downsides to Futures trading rooms and we have outlined a few of these below for further reading.
What are the disadvantages of using a futures trading room?
Overall cost of using trading rooms
Due to the level of support and experience leveraged in futures trading rooms, the cost can be unobtainable for the average trader or part-time enthusiast. In some cases, full packages which include training, development and resources can soar upwards of $5000.00. If you are looking to use the room for just practicing purposes the cost is obviously much less be can still be out of reach for some.
Trade rooms can be a tough place to learn for novices
With so many things going on and having to monitor three or four screens at a time, learning can sometimes take a back seat. The moderator is focused on watching developing trends and will call out important information for the traders and you may miss things that are being said and begin to lose focus during downtimes in the market. Being nervous also plays a small part but that nervousness will go away after your first few weeks if you stick it out and stay the course.
It doesn’t fit your style
With different personalities and trading strategies, you have to ask yourself, does it fit you? What if they are aggressive? passive? If their thought process is faster than yours? How long does it take you to make a decision to go in on a trade? Will that few seconds ruin your profitability?
Strategies does not fit your budget
Just because the trading expert has $100,000 on their account does not mean their strategy will work with your $1,000 account. In some cases, these experts might do a $1,000 challenge and work their way up. But most of the trading included buying multiple stocks, which they can easily afford, while you are stuck with one of their picks. Their probability of winning 7 out of 10, might make them a profit, but if you are trading 1 out of 1 stocks and if that trade is a loser, you end up being broke. Understanding this is crucial to picking the right trading room that fits your budget.
Overall, being a part of a Futures trading room can be an exciting and rewarding experience regardless of your trading experience level or career aspirations. Good trading rooms are set up with all of the communication equipment you need in addition being fitted out with all of the kit you need to successfully plan and execute successful trades.
As a novice, once you understand the market and gain some crucial experience on your own and from other traders, you will never go back. From the point of view of an experienced trader, the ability to gain some tricks that you may not have been aware of is something you can’t put a price on and you just might come away with more than you had before which is a great thing.