Let us start with a simple statement of fact; and that is that spreadbetting is, quite simply, trading and trading is hard – we make no bones about this. An open industry secret is that of all novice futures, FX and stock day-traders, less than 10% are successful over the long haul based on anecdotal evidence.

You may have heard the term whipsaw loss but you may be at something of a loss as to what it means. It means a loss that you suffer when you’re trying to enter a position and your newly-opened position stops out at a loss because the price goes the wrong way.

The average client lifetime for a spread betting company seems to be just 6 months. By these standards I am positively ancient…

I don’t know that you’re losing at spread betting, of course, but it’s a fact that most spread bettors do lose money. If you are one of them then you need to avoid some of the psychological traps we will highlight in this feature.

Many first-time spread bettors and even first-time investors are fond of trying to catch falling knives. It’s generally frowned upon in trading and investing circles, because when you try to catch falling knives the chances are good that you will be cut to shreds.

In my article How many spread betting accounts do you need? I referred to something called The Trading School of Hard Knocks. It’s not a real school, of course, but is what I affectionately call the recipient of the trading losses that I made while learning the ropes (and which I sometimes still do).