This means looking at larger issues such as the future for transport or future of energy and then thinking which companies are best (or worst) placed to benefit.
You may feel that self-driving cars could become the dominant form of transport in ten years’ time. What are the ramifications of this? Not just for car manufacturers, but for tech companies working on sophisticated sensors or satellites. It may be that satellites are replaced by new technology for instance. And if in the future we’ll be able to summon up a self-driving car through our smartphones, what does that say about the future of Uber, or car parks for that matter?
From here you’re just a few steps away from identifying companies that could benefit from future developments and those that will have to adapt or die. Suddenly you could have a clutch of potential trades that you could capitalise on through CFDs. If your ideas are solid, your technical analysis good and you get the timing right, it may not be too long before other investors catch on and momentum builds. In this way it’s possible to get in at the beginning of a profitable trend.
By developing your CFD trading ideas in this way you’ll have your own reasons for doing the trade. This is much better than taking trading tips from third parties. After all, we can’t know what another person’s full trading plan is, or if they’ve even got one. This means that we have no idea what their tolerance to risk is, let alone how it may compare to ours. That may not matter if things are going well, but what do you do if this “sure-fire thing” starts to go wrong? Developing your own CFD trading ideas helps to build self-confidence and gives you the tools to trade again and again. This will help you to be a successful trader.