Tips to earn good returns while trading in crude oil.

It is a well known fact that price of different commodities like crude, gold, silver and more are ruled by law of demand and supply. With traders, speculators are also present in the market and when their interests are also considered it is bit difficult to make prediction on price movements of commodities. Crude oil is traded across the world on large scale and is expected to be a useful resource in future as well. Million barrels of crude oil are bought and sold every day, therefore consumers and producers both start looking for the ways to successfully hedge against future price risk.Experts suggested crude oil tips are helpful for earning good returns as it is quite difficult to determine which factors are most likely to affect its price and in which direction.

Some useful tips to improve your returns are discussed below:

• Use proper stop loss

Oil prices are affected by various global factors as well. Therefore it is always recommended to use proper stop loss while trading in it. Ideally stop loss of 20 points is considered good. Using a small stop loss can be a reason for your bad performance or loss.

• Keep a good track record of market updates

As already discussed lots of factors affects price of oils. Traders who trades in such commodities have to be extra careful with market updates. Skipping one big information can cost you a lot. Pay more attention to market updates and latest news to be on the safer side and plan a wise trading strategy according to the market needs.

• Pay attention to the time at which you are trading

Trading at market opening and closing time should be avoided if you are a new trader, less experienced or do not have sufficient market knowledge.Also learn the market timing of international markets. As major price fluctuations are witnessed with open and close of other markets.So it is better not to trade at such hours to avoid earning loss due to any unexpected change in the market trend.

• Have realistic expectations and don't be greedy

Traders and investors often end up earning huge loss in lust of earning exceptionally high returns. It is advisable to book profit with movement of 15-30 points rather then holding position and waiting for larger movements to take place.

• Trade within limit

It is always suggested to trade within limits in oils, which means that you should have margin to recover from unexpected and sudden movement in the market. If you have capital to trade in 10 lots of crude oil than go for 5-6 lots only to ensure required margin amount in case of market uncertainties.

These are some tips which can be used while trading in crude oil and other price volatile commodities. It is very important to learn how to invest in shares and commodities before beginning to trade in them. To become a successful trader a good knowledge about market along with lots of hard work and patience is required.

I am a financial analyst. I always like to read and explore more about market.