What many new online traders go through, within the early days of trading, ultimately frustrate them. There is a great deal to grasp, a great deal to understand and a great opportunity for profits and losses. It takes a lot of analyzing; research combined with long hours along with patience to wait out formations, and patterns, for an individual to make money. If you are a first time stock trader or investor, read this information, and consider its value, as you trade or invest online.
(1) Don’t Pay for Free Information.
Never, pay for online trading information. In most cases, you can obtain it free. Why pay money for so-called hot stock information when you are able to obtain it at no cost. These two sites, The Street.com and Motley Fool.com., have a great deal of online stock buying and selling information within their websites. A person can spend days, weeks, and months trying to read, all the information within their webpage’s.
(2) Find a Trading Brokerage.
With more than a dozen discount brokers available, you’ll want to look closely at every single company’s fees, which can cost anywhere from $5 to $20 or more a trade. Ask, the brokerage firms, for a demo, of their online trading web platform. Take it for a test drive, see, if the brokerage firm is right for you. Furthermore, you want to experience all the brokers’ gizmos and gadgets, before you start trading. If, you wish to trade away from home, you should check to see, if the broker has a mobile app.
(3) Don’t Make Trade According to Message Boards.
While, there are some honest stock traders and investors within the online trading world, there are a great deal who intentionally, distribute inaccurate information on stock market and investing forums. All too often, traders and investors will get suckered into a pump and dump scams, which leaves them holding shares of a stock, while forum posters either exiting or shorting, the very positions for which they proclaim where so wonderful on the message board. Use your common sense, if it sounds to good, then it most likely is.
(4) Purchase Good Companies.
Buy shares of stock from companies that produce quality goods, offer essential services, or are up incomers within the markets or a particulate industry. Go with reputable companies that have sound fundamentals, good revenue and positive outlooks, rather than one, which is not well established. For instances, the Apple corporation. It is a high value stock, solid revenues and strong reputation of delivery quality products. This would be a good stock for trading or investing within, even though it’s current market share price is over $500 dollars (as of August 2013).
Note: If, you invest in a solid company, even though you receive fewer shares, it is a way better value, than accumulating more shares of a less valued company. Always remember, when trading and investing, well establish “brand name” companies are assess more for their overall value, due to past performance and their reputation for success.
(5) Do not Buy Foreign Stocks.
Do not buy stock in a company that makes products you do not fully grasp. For example, if someone came to you with news of a new drug that could ease the symptoms of a devastating disease by 50 percent, you might jump at the chance to get in on the stock. However, before you plunge, all your hard earn money within the stock; you might want to know exactly how the pill works, right? Also, wouldn’t you along with what type of medical trials did it undergo (also how successful where the trials), as well who is fielding the drug. A good piece of information would be, if the Food and Drug Administration approved or is consider approval of the drug. In addition, important news would be that the FDA chooses not to approval the drug or issues a warning about it.
If, you are careful when trading and managing your money, you will make money and only need to pay the standard small brokerage fee. Therefore, if you are not a good trader and do not manage your money well, you will incur losses, and have to pay your broker their standard commission fee. Remember, online trading as well as investing is extremely, risky, but worth the risk, if done correctly.