All of the brokerages have online trading platforms, and they have great tutorials to go along with them. Even a complete novice can go to an online trading site, and learn how to trade just from going through the site’s tutorials.
If you have never bought or sold stocks, mutual funds, ETF, or traded in options, it is recommended that you go through the tutorials completely before trading.
The companies even have practice time, where you can play the real stock market, but with paper money. In other words, you invest in stocks, but it is like a computer game where you don’t really risk any of your own money, just the play money in the computer. But, in this way you learn how the system works and you see how a live market works.
Online trading gives you a variety of tools and research resources. The idea of vesting in stocks is that you are investing in a company that is hopefully going to do well and make a profit. If that happens the value of the stock will rise over time from the amount that you paid for it. This is called the buy and hold strategy, where the result takes a while for the stock to rise.
The other strategy, trading may only last for a day or two, or even and hour or two. The trading platform will have tactics and strategies all worked out for each stock, and if a person follows the directions for those programs, you can do pretty well.
The computer does quite a bit of research for you based upon your objectives, risk tolerance, and so on. It will do a certain amount of research to find out the history of the company and how its stock reacts under certain conditions. Of course stocks react in relation to how many other investors are buying or selling the stock, but there are other situations that can affect the movement of the stock as well.
Some of the factors that affect the movement of the stock can come from the political environment, the overall financial market, and any special events that might occur in that particular stock’s sector. As an example if you invest in a dog food stock, and suddenly there is a recall of several brands of dog food, your stock might take a tumble until the situation is cleared up.
The nice thing about trading your shares of stock online is the convenience. You can be online all the time and make your trade any time that you wish, but the trade won’t actually be placed until the market is open the next day.
Another nice element is that you can start out small and pace yourself until you learn more and can start trading in larger amounts.
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