Trading education

About Online Trading

The internet has changed the way we live our lives. One of the biggest changes is that we are now able to communicate with each other 24 hours a day, 7 days a week and 365 days a year. A few years ago, trading had to be done during the daylight hours. With the introduction of new laws and technology we are now able to trade anytime of the day!

Some of the more common activities of online trading are stocks, futures, forex and option trading. Previously you would have to give your broker a call or write a memo before any trade could be done. So a lot of good trades were missed out. Also brokers would have minimum sums to trade. Retail traders suffered a huge profit loss due to that.

Now all brokers offer some sort of online trading to their clients. Due to that the costs of trading has also gone down substantially!

Though if you are new to the world of trading, a word of caution. Before you jump in and get your feet wet, which will most likely result in you losing money, I would suggest that you obtain a trading education first.

There are a lot of good sites that can offer you free tutorials on how to trade, the basic of trading and there are also loads of forums that give away free information.

But you know what they say about free information…it often is too good to be true. I would suggest that you invest in your own education. Learn as much as possible, but don’t let learning be an obstacle to your trading activities.

Online trading has given retail traders like us a breath of fresh air. Now the whole market scene has changed and the little guys, you and I can play the field with the “big boys” without fear of losing out.

By: Joshua Geralds

The search for an automatic forex trading system that works is often seen as the search for the so called “holy grail” which is the reason why many traders have lost huge sums of money and more are still loosing. When it comes to an automatic forex trading system, the search is likely to be long and arduous, and there is the question of why is everyone not using it?

In fact, I don’t believe there can be an automatic forex trading system that can assure you of 100% successful trades as claimed by most because there is always the element of the forex market which is totally unpredictable.

It’s not far fetched for a forex trader whose automatic forex trading system is based entirely technical analysis to come back the following day and encounter an unexpected reversal due to fundamental (socio-economic) news being announced lower or higher than expected resulting. So, if fundamental analysis can not be predicted, and as one author puts it “no one knows what’s going to happen” in the forex market, how can an automatic forex trading system be possible?

The answer lies in the understanding that if you truly want to use an automatic forex trading system, you are going to have rules, such as not trading in the vicinity of news time where the market reaction can be unpredictable based on technical indicators due to the reaction of the market to the news such as the non-farm payroll data once per month.

Before using an automatic forex trading system then, the trader must know the online currency market fairly well. Must understand that nothing can replace basic education, no matter what system you use basic forex trading education will help you identify better with the system you choose to use. It is also important to have education and mentoring and at least training in some indicators and strategies to understand the reading of the market technically, as well as a sound understanding of the fundamental analysis aspects of the market.

Using automatic forex trading system with a stop loss is one way to ensure that even if your system is entering trades that agree with the technical analysis prior to news release, your stop loss is there to get you out if the news comes out on the other side and things move against you. But if you can altogether avoid using your system before important announcements I personally think it wise.

Conclusively, there are automatic forex trading systems that indeed can generate profitable trades for any trader but they are not without rules.

By: Karen Fairham

Here is a very short answer: slowly. And don’t even think about it until you learn a few basic things about the stock market.

I still remember very well my first trade. It was about 10 years ago. The stock symbol was FOTO, no longer listed as its price dropped too low over the following two years. I then sat watching its price gyrations for a few hours getting more and more disgusted that it refused to move at least 20% right after I had bought it. In fact, it barely moved in a few days that followed and so I sold it. I hate when stocks act like that!

My second stock was CUBE. The company was bought out eventually so the stock is no longer listed. This one too refused to move, so I sold it. Another stinker.

I realized later that I would have made money on both of them had I held to them longer. After all, it was still the full blown bull market of the 90s and virtually every stock you bought those days would go up. You could make money by simply throwing darts at stock charts and even if you were blindfolded, you would probably still make money with your trading “method.” But I did not know that yet, although being a quick learner I soon figured out what I needed to do to make money in stocks.

And here are the things that I learned that made me money and if you follow them you too stand a good chance to succeed at trading stocks. Perhaps you will even make a killing.

1. You need a plan to make money in stocks. This plan has to include, among other things, your timeframe, when you exit your position and under your what circumstances.

2. You need to do your research before you put a trade on. Wishful thinking is not enough. It does not work. You need to know why the stock you are about to buy will appreciate in price. Why would that be? What are the reasons to drive its price up?

3. You need a sound mindset and that includes patience and sticking to your plan. This is sometimes easier to say than to do and can be a big hurdle to overcome, especially for beginners.

4. You need to be independent. Following the herd can feel comfortable, but is a well-known way to a poorhouse. Choose to be a contrarian rather than a follower of crowds. Crowds are often wrong. Too often to follow them.

5. Never cease to learn new things and study new trading methods, but don’t change those that have worked well. In fact, being conservative in your methods is fine, try new things only if they promise to be much better than your older methods.

6. Avoid distraction from slick snake oil salesmen. There is no fast way to a million, but some are better and more solid than others. Relying on your own judgement beats all other ways, in my opinion.

Good luck then!

By: Waldemar Puszkarz