Hermann is a professional trader with 16+ years of experience on the financial markets. His crypto overviews benefit many traders and investors alike, viewing the cryptocurrency markets from both fundamental and technical perspective.
We are delighted to introduce to you Mr. Hermann Koeckemann. Hermann has more than 16 years of extensive experience as a trader and market analyst. He provides crypto market analyses for CoinChoose.com on a weekly basis, so our readers may benefit from his professional expertise. We have asked Hermann a number of interesting trading and investing related questions, aiming to present him to the CoinChoose.com community. We would also like to thank Hermann for the high-quality market overviews he provides our readers with, making CoinChoose.com even more valuable source of vital and up-to-date crypto markets information. So, without further ado, please welcome Mr. Hermann Koeckemann.
Hello Hermann, it’s a pleasure meeting you. Thank you for helping us provide high-quality market analyses to our amazing community. How long have you been on the financial markets? And how much time it takes to become a professional trader or investor in your opinion?
Many thanks to CoinChoose.com for providing me this opportunity, as well as for the interview, so I may share some valuable and important insight with our readers. This website is really great and provides awesome content.
The diversity of the markets we have in this day and age didn’t exist 16 years ago when I started my intensive trading education. In my opinion, learning how to trade on a decent level takes 5-7 years on average.
What made you decide to tap into the world of the financial markets in the first place?
The connection among economy, politics, and finance caught my attention in my early youth. I was also influenced by my parents. Even back then owning shares was considered a common way of investing. That’s how the topic of investing in the stock exchange came to me very early.
What is your opinion about investing directly in the underlying asset versus trading it on margin as a contract for difference (CFD)? What factors determine your preferences in terms of cryptocurrency trading, as opposed to trading and investing in general?
That certainly depends on the type of trader or investor you are. Especially when you start learning how to trade and invest in the markets. You may make your first steps into the world of the financial markets with a little capital investment via a CFDs trading account. The investment horizon is crucial in terms of determining whether you are going to be a trader or an investor. Of course, you can trade and invest at the same time – one does not exclude the other.
What does your typical trading day look like?
Haha, this question keeps coming over and over again. Well, my trading day certainly looks different than many folks might think.
The first hour after getting up I keep for myself. I put my thoughts together and meditate. This is of great importance to me, so I could get rid of any stress and disturbing thoughts till the end of the day. My ultimate goal is to stay fully concentrated and focused.
Then I take my first look at what happens on the markets and prepare my trading plan for the day. I look at different time frames on the chart and run my entire potential trading activity till the end of the market session in my mind. At the end of this thought experiment, I decide if I’m going to be active on the markets this day or not.
By noon I would probably start trading.
Afterward I would take a break. I usually go for a walk or ride a bike to get away from the market before the second part of my trading day begins in the afternoon. This normally happens around 3.30 pm till the end of the market hours.
In the evening I do sports and exercise to stay fit.
The markets are a very complicated topic. How do you educate yourself? Which is the best approach to getting to know the markets?
You have to invest time. It takes time to get familiar with the markets and their mechanisms. Impatience leads to the failure of every trader. That applies to every stage, regardless of the trader’s or investor’s activity – from the very beginning when it all comes to learning, as well as later on, when the trading execution starts.
Especially in trading, you should collect as much market insight as possible in the learning stage, because the price movements tend to repeat and are often similar.
Speaking about trading and investing education, what is your opinion about using demo accounts? Do you find them helpful?
Oh yes, virtual money accounts in my early days were quite limited, difficult to find, and usually not free of charge. Many things happened since then. Using a fake money account may be put next to investing a great deal of time, and reading books on the subject, as well as the willingness to learn how to become a successful trader or investor. Paper trading is very suitable for novice traders and investors alike.
Why are so many people losing money on the markets?
Many people lose their invested capital in the markets because of the wrong approach. They only want to make money… and that’s the only thing they see. Successful traders and investors enter the markets driven by love and passion. Money comes afterwards. The mental attitude is the key to success. Many people believe it’s just enough to have two effectively working trading setups in order to get rich.
In fact, trading success is very similar to success in sports. In order for an athlete to be entirely focused and efficient during a sports event, they must do a tremendous amount of work beforehand. And that’s exactly what 95% of beginner traders are not ready for. This is why they fail. How most people perceive the markets is similar to watching a player scoring a goal during a football game. Everyone can see the great show, but all the work that led to making it happen remains hidden. Everyone understands that a top player trains a lot and performs mental endurance practices. In trading and investing, however, many believe this is not the case and lose their money. Just because I ride my bike every day does not make me think I’ll win Tour de France.
As the risk of losing money on the financial markets is significant, what is the best way for managing it, according to you?
As per my understanding, proper preparation and constant mental work ensure the best protection against poor trading and investing decisions. The better prepared I am, the better I can assess certain market situation, and the more decisive I become. While there are many different approaches heavily dependent on the trading setup, I would always hedge a trade quickly.
Which are the top 3 qualities every successful trader or investor should possess?
Investors may afford themselves to act more calmly, compared to daytraders. Therefore, an investor should be able to keep an eye on the big picture, and monitor the topics which are politically and economically relevant at the moment. The investor should also possess the creativity to visualize and assess the future impact of those political and economic events. Put simply, the investor should be thinking analytically.
The trader, on the other hand, needs to digest the market quickly, and be able to decide in a blink of an eye, without wasting too much time.
If I have to go through a lot of stuff to make a decision as a day-trader, I will always follow the markets.
Which is your preferred type of financial analysis, Hermann – fundamental or technical?
Paradoxically, both. I look at the big picture to spot market trends. However, in terms of trading execution, I concentrate on technical analysis. I still apply some drawings reflecting what I came up with while analyzing the fundamentals. If I think the market is bullish, for example, I apply bullish setups only.
What is your preferred trading style – scalping, daytrading or long-term trading, and why?
I am very impatient in relation to getting results. That’s why short-term trading is kind of my thing. If the markets move significantly, I would prefer acting as an investor, making investments developing over the long run.
How important is the market sentiment in your opinion, Hermann?
Very important and often ignored. However, smart traders always act intuitively and ultimately come up with a decision.
What is your point of view in terms of cryptocurrency trading? Is it just a hype, or it marks the beginning of a new chapter on the markets?
Cryptocurrencies are here to stay. At first, they were considered a hype, which I believe was a sign that cryptos will continue to develop. I cannot currently forecast the direction they are headed to, but I can imagine cryptocurrencies will have more influence on our everyday lives in the future.
How do you see the future of Bitcoin and cryptocurrency trading as a whole?
That depends on if and how heavily Bitcoin and co. will fall under central bank regulations. If this happens and the crypto markets become fully regulated, the original idea behind cryptocurrencies will be lost, but another door will open.
As we are talking about crypto, do you trade cryptocurrencies yourself?
No, I do not trade cryptocurrencies. That’s due to the fact that I feel comfortable trading the DAX and the Dow Jones. Those are the markets I know well and prefer to stick with. I am not a fan of changing the markets you trade, just because new ones emerged and started gaining momentum. This is similar to the relationship with your better half. You don’t run away just because you had a lovely conversation with another woman in the café (laughs).
Thanks to the rapid digitization of the world, now each and every one of us may become a retail trader and investor. Do you think more and more people will follow your example and become full-time job traders and investors?
Digitization already plays a major role in our professional lives and brings us many career opportunities. There has been an incredible shift in the last 15-20 years and this process is far away from coming to an end. Steve Jobs has sparked a new “Industrial Revolution” with the invention of the iPhone. I do not have a crystal ball, but I am convinced that more and more people will find their way to the markets in the future, and recognize trading and investing as a career opportunity.
What type of financial instruments do you trade? Which broker and/or platform would you recommend for beginners?
As a beginner, I think one is in good hands with margin trading. I prefer futures trading myself. It is crucial to select a broker and platform you feel comfortable trading and investing with. Don’t choose a platform only based on popularity, because you may not feel comfortable using it. The same applies to information gathering. I will pick the sources I believe make me well informed and cover the markets I’m interested in. Thanks to websites like CoinChoose.com you can get specific information that will enable you to focus more.
Let’s finish our pleasant conversation with a casual question. Do you have any hobbies, Hermann? What do you like to do in your spare time?
Yes, I discovered playing golf two years ago. it is the only sport in which I can completely switch myself off. I have never succeeded in any other sport, so I am very happy with this discovery.
Thank you for your time, Hermann. We wish you good luck on the markets.
Thanks for having me.
Do you agree with Hermann? Are you a trader or an investor? What is your style – scalping, day trading, long-term trading or investing? Share with us in the comments down below. Make sure to follow CoinChoose.com on Facebook, Twitter, and LinkedIn to never miss what’s new.
The content of this article should not be construed as investment or trading advice, nor a recommendation. It represents the author’s sole opinion. CoinChoose.com could not be held liable for any loss incurred by using this information.