Keen observation is the key to an effective social trading performance. This strategy is commonly suggested for people who are into CFD trading but are not comfortable with financial market and chart analysis. Experts and financial coaches even say that Social trading is a budget friendly yet sophisticated strategy that a novice trader can use on his early trading sessions.
This strategy is quite simple to perform, all you have to do is to know the social background behind the market and the people you deal with. You have to take note that one’s culture basically affects one’s decisions and personality. Someone else’s social habits, language, religion, health, education and even investing decisions are some of the by-products of cultural background. Our goal for today’s post is to educate ourselves on The 4 Cultural Situations that have somehow played an effect on traders ‘ decision towards placing their positions.
1.Transylvanian and Anglo Saxons
Anglo Saxons are the group of people who inhabited and ruled territories that are today part of England and Wales. Transylvanian Saxons on the other hand are a people of German ethnicity who originally settled in Transylvania from the mid 1100 BC up to mid 1800BC. The Saxons, which is a general term for this group, are characterized by sociologists as people who believe in the equality of power as they only had groups of people who governed them instead of a king. In a recent study, professors of behavioral finance have observed that traders with Saxon as their cultural background( Russians and Romanians) are willing to spend more of their money for equities.
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- Americans
Sociologists believe that US social classes exist. One example is the sociological hierarchy that was devised by Sociologists Dennis Gilbert et. al. which states that the US has 6 distinct social classes. These are the rich and powerful, the highly educated and affluent professionals, the white collar college-educated individuals, the semi-professionals with units in college education, the working poor and the unemployed underclass.With this set up, one can understand why we meet “Ego traders” from the US region.
- Nordics
The Nordic region region is made up of five countries: Denmark, Finland, Iceland, Norway, and Sweden. Tracing the Nordic lifestyle and culture would tell us why German and Nordic traders are typically patient enough to wait for notable results. These people can live by putting an emphasis on the use of seasonal and locally-produced ingredients and they believe in democracy, freedom of speech, equality, mutual respect, and trust.
- Chinese
Chinese countries tend to have a high regard for superstition. From lucky numbers to feng shui, we can see that it has already become part of their lifestyle because they believed that superstitions boosts their chances to succeed in a particular endeavor. This idea makes gold a very tradable metal every Lunar New Year because a 24-carat zodiac jewelry featuring the zodiac is frequently given as a present during this season.
Conclusion:
Because CFD trading offers opportunities for the global market. Thus, a knowledge on the socio cultural background of the majority of traders and brokers would help create a more harmonious trade thereby giving you the advantage to eventually gain profit.
