Over-the-counter derivatives are leveraged products that carry a high level of risk to your capital. Trading is not suitable for everyone and may result in you losing substantially more than your initial investment. You do not own, or have any rights to, the underlying assets. You should only trade with money you can afford to lose.

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Share Trading Fundamentals

Shares hero mobile image
Shares hero mobile image

Course overview

1. Investing in stocks vs. trading share CFDs2. What is the earnings season and how does it affect the price of shares?3. Trading the stock market: So, how does it work?4. Trading on Initial Public Offerings5. Putting your stock-trading strategy into action6. Using risk management in share trading7. Conclusion

6. Using risk management in share trading

While share CFD trading is potentially profitable, risk management strategies are crucial.

 

  • Using stop-loss and take-profit orders to protect against emotion and greed
  • Using money management to limit risk per trade  
  • Diversifying capital across different shares
  • Avoid excessive leverage 

 

Psychology is also crucial for staying disciplined, avoiding impulsive decisions, and managing expectations. Focusing on long-term consistency is essential. Find out more about Risk Management in Axi’s Risk Management course.

Quiz

1/1

Why is diversification important in share trading?

A) To reduce risk by spreading investments across different stocks.

B) To increase returns by concentrating on a few high-risk stocks.

C) To simplify portfolio management.

D) To avoid paying transaction fees.

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