So you think you got what it takes to be an oil trader? The requirements for oil trading isnt that much. All you need is at least $1,000 worth of financial capital, a broker, and a computer with an internet connection. You do however need to possess some important qualities like discipline and resiliency if you want to be successful in this kind of endeavor.
The first thing that you need to do to if you want to become an oil trader is to find a broker so you can commence on trading oil. This is the main thing that you need to do as you need to be involved with a broker in order to participate in the action. Some examples of popular brokers in oil trading today are ForexYard Broker, Easy-Forex Broker, and AvaFX Broker. The good thing is that you can access them and that you can create an account through the internet so you dont have to go to the NYMEX to actually trade.
Each brokers have their own set of rules regarding the minimum deposit that you can make, with some you can deposit as low as $100 while others require at least $1,000. They also have different rules on the minimum number of virtual barrel of contracts that you can purchase, the margin required per barrel, the and the spread.
Another good thing to look for when choosing a broker is the leverage that they offer. It refers to the ability to control a large amount of commodity with a relatively small amount of capital. This can be a double-edged sword as it describes the volatility of the trade since a high leverage can either lead to large gains or large losses. Oil traders usually get a minimal leverage of 1:40 but sometimes it can go up to 1:200.
If you are a novice oil trader and is still hesitant to risk investing your money, most brokers offer a free demo account that you can practice on before actually entering the real deal. Once you are already a fully pledged oil trader, what you need to do is constantly look out for signs in the market in order to make good decisions like when to buy or sell oil barrels. Another tip when trading oil is to never risk more than 2% of your trading account on a single trade so that you wont thrash your account of some bad trades which could normally happen in oil trading.