3 Easy Steps to Start Online Trading

3 Easy Steps to Start Online Trading

Online trading explained: A comprehensive guide to help you begin online trading

For those veteran investors, online trading is almost second nature, but for beginners who are just starting out, it can be a mysterious and daunting place.

Now that online trading is more accessible and more affordable than ever before, executing a buy or sell trade can be completed via an online trading platform in just a fraction of a second. Easy To Use Platform

Online trading has given anyone who has a computer (or smart phone) and internet access, the opportunity to trade the financial markets. Fortunately, nowadays, you don’t need masses of disposable income, a personal broker, or a fancy, suave suit, (tracky dacks are even a suitable attire if you’re that way inclined).

However, there are a few key requirements that are necessary when starting out in online trading. In order to make this transition more seamless and less risky financially, we have outlined a 3 step system to help you successfully participate in online CFD trading.

Step 1: Understand How the Market Works

Global financial markets operate on a system of supply and demand. When you purchase a CFD stock in a company, your hope is that other traders also want to buy the same CFD stock, creating a competitive demand and bidding up the price.

A rising share price can be accredited to a number of factors, however in theory, it is typically due to improvements in the company’s values and potential, also known as their fundamentals.

In reality, share prices can change for any number of reasons including world events, high impact economic announcements, economic conditions and the list goes on.

It’s important to remember that although the exact direction that the price moves is somewhat unknown and pretty difficult to accurately predict, there are steps you can take to ensure that you have as greater understanding of the likely movement as possible. This includes understanding general price movement, as well as short term price action.

Learn how to understand general price movement with our comprehensive guide here. Unsure about short term price action as well? Let us explain here.

Step 2: Researching and Selecting a Stock

There are two main methods for analysing and choosing the right stock for you to invest in:

Fundamental Analysis

The first is fundamental analysis which involves researching the company’s financial reports and public statements in order to determine the health of the company.

Important tools for fundamental analysis include the company’s balance sheets, quarterly and yearly earnings, income statements, expenses, assets and liabilities and news announcements, all of which are available to view online at either the website of the company in question or ASX.

It’s also good practise to check the company’s media releases and history as well as industry trends, as they too can play a key role in fundamental analysis. Bloomberg is an excellent resource for delivering business and market news.

As such, understanding how to analyse a company’s fundamentals involves looking at both quantitative (i.e the financials) and qualitative (i.e the intangible aspects of a company).

Technical Analysis

The second way of analysing stocks is technical analysis. This method encompasses the notion that swings in share prices follow patterns that traders can use to ultimately predict the potential direction of a stock. It involves studying charts of historical price action in order to predict future price movement and often entails using indicators that represent price movement or volume.

The basis of technical analysis is identifying short and long term trends and patterns, price support and resistance levels, the strength of price movements and who’s in control; buyers or sellers (or neither).

Technical and fundamental analysis can either be used separately or in combination, and both methods can result in choosing successful stocks to invest in. Let us show you how to assess the overall state of the market here.

Step 3: Practice, Practice, Practice

As with anything new, online trading requires you to educate yourself and to practice. Aside from using the above analysis methods to assist you in selecting the right stocks to invest in, it is also important to educate yourself on how to actually trade and practice these skills.

Free Demo Accounts

Demo accounts are widely available for beginners to practice their trading risk-free. This provides the opportunity to try trading different markets, time frames and strategies while experiencing a live trading environment, complete with live pricing and the ability to execute trade orders, without risking money.

Practicing your trading skills will not only help you familiarise yourself with the trading platform you’ll be using, but it also enables you to test different strategies so that transitioning to a live account is comfortable and seamless.

Online Trading: The Bottom Line

Online trading has revolutionised investing in the global financial markets. Although this industry seems flooded with stories of those who made or lost millions from the market, it’s important this doesn’t influence your investment decisions.

The above steps are a great starting point for you to learn how to trade online. If you take the time to conduct effective research, educate yourself, and practice your trading skills then you’ll be well on your way to developing a profitable trading portfolio.

Ensure you give your trading account the best opportunity to succeed by choosing the right CFD broker.

To find out how read our: How to Tell if Your CFD Broker is Ripping You Off.

What are the Benefits of Online Trading?

Trade using Leverage

Online trading using CFDs allows traders to make trades using leverage. By using leverage, clients can buy or sell a financial asset with substantially less money than the actual full market value of that financial instrument. The lower the margin requirement, the less capital you need to place into your account to make a trade/s. It is important, however, to remember that increased leverage can also significantly magnify potential losses.

You Can Trade Long or Short

Traders can profit not only from rising markets but also from a downward trending market. This allows you to short the market if you feel a financial instrument will decline in value. This is one of the biggest benefits of online trading.

Global Market Access from 1 x Online Trading Platform

Most online brokers will provide access to a wide range of global financial markets, including indices, forex, commodities, stocks, cryptocurrencies plus more – all on the one trading platform.

Plenty of Trading Opportunities

Online trading provides traders with an almost unlimited array of trading opportunities – again,  including stocks, currencies, commodities, cryptocurrencies and indices. For a complete list of TradeDirect365’s products, view our Market Information Sheet.

Want To Learn More About Online Trading?

Online Trading: How to Trade Online for Beginners

Online Trading: How to Trade Online for Beginners

It wasn’t long ago that investing was reserved for institutions and very wealthy individuals. Even then, early investors needed to go through an intermediary and a simple stock purchase could take days.

From its humble beginnings a few decades ago, online trading has transformed the world of investing. With a bank account and a small amount of capital, everyone now has access to a wide range of assets and investing tools.

Alongside this rapidly increasing accessibility to the investing world there is a growing interest in self-directed investing, particularly in terms of retirement planning.

The high fees and poor results of traditional managers have driven an ever-increasing number of people to start managing their own funds using online brokers.

So how do you trade online? These are the first steps you’ll want to take:

1.) Take online trading courses

2.) Develop a strategy

3.) Practice in a simulator

4.) Open a brokerage account

5.) Share your knowledge

Here is a brief guide to online trading, so you can start managing your own money and seeing the kind of returns that can change your life for the better.

Step 1: Take an Online Trading Course

Education is number one!  You simply can’t succeed as a trader without education. In our courses we take you under our wing and give you every possible advantage of success.

Online traders come from a huge range of backgrounds in terms of education, employment and life experiences. Whatever your background is, an online trading course will introduce you to the basics of online trading, and provide you with a foundation of knowledge and experience that you can then build upon yourself

In contrast to the majority of students who trade the markets alone, students in our classes and chat room have the benefit of working with a team of professionals.

We have traded through 1,000 point market crashes and 10,000% biotech runners.  We’re here to help guide you through the action.

We also have a reading list of books we recommend to all of our students in the chat room which you can find here. This is a great place to start with gathering trading information from experts at a reasonable cost.

Regardless of whether you join our program or not, education is critical.  You need to develop a strategy that you will trade every day.  This strategy will be critical to your success.  Trading online is a career where you can’t be a jack of all trades and a master of none.

You need to master 1 strategy because that will be your means for survival in the market.  Those traders who are able to survive in the market eventually learn.  It takes some traders longer than others but the first step is developing a sustainable strategy.

Step 2: Develop a Strategy

Successful online trading involves finding a niche in the markets and sticking to it. If you’re regularly jumping between asset classes and trading strategies, you’ll find that your results will be purely the product of luck instead of smart investing.

Start by picking an area of the market that you are comfortable trading in. This can be equities, bonds, derivatives, commodities or currencies. Even within these broad asset classes, you are going to want to focus in further on specific sectors so you can truly master one area of the market.

Some trading strategies can involve more than one asset class, but they will still be focused in on a clear and simple investing idea, as opposed to trying to understanding a wide range of different factors that drive market prices.

Once you’ve found your niche, start developing one or more trading strategies that suit your knowledge, experience, skills and goals.

For example, if you only have a few minutes to work on your online trading each day, then day trading might not be the best choice for you.

Similarly, if you have no idea how derivatives work, then you should avoid complex option strategies.

Your trading strategies will constantly evolve as you grow as a trader. Start simple and small, and then build up in sophistication and complexity as you gain experience.

Step 3: Practice in a Trading Simulator

Open a demo account where you can practice your strategies without risking real money. There are a couple different brokers out there that have demo accounts but we have found the best ones to be Warrior Trading Simulator.

We will begin with $50 risk per trade and build up to $200 per trade risk.  This will get you on track to make $2k/week or 100k/year within 3 months.

The most important thing to do is to track all of your trades in an excel document. This allows you to begin tracking your success!  It’s critical that you understand your percentage of success, and profit/loss ratios.

These numbers will tell us if you have a successful and sustainable strategy.  When I work with new students I always ask to see the record of their trades.  I use this data to determine what we need to work on first.  If for example a student has several huge losses I’ll recognize the importance of capping losses.

If a student has a 30% success rate we need to focus on taking better quality setups.  If you don’t know your statistics, you can’t improve!  I don’t recommend new traders try to build up this data with live trading.  Live trading unproven strategies is too risky.

Step 4: Open a Brokerage Account

Transitioning from a simulated trading environment to trading with real money is a big step!  We review the performance of our students before giving them the OK to move out of the paper trading account.

It’s an absolute must that if you are going to be successful trading online that you have been successful paper trading.

If you can’t succeed in a demo account, there is no reason to believe you can succeed with real money.  We teach our students the strategy we use every single day to profit from the market.  This are proven strategies.

Our goal is to see you succeed as a paper trader and then switch you into real money trading.  Whenever a student makes the transition we begin with 100 share max positions.

We start slow to allow trades to acclimate to the experience of a loss.  It takes time to adjust but this approach of starting with 100 shares and then increasing by 100 shares each week has been very successful.  If you aren’t sure which broker to trade with check out this post on the Top 3 Best Online Trading Brokers.

Step 5: Give Back What You Have Learned

The final step is when you become a profitable trader.  You are now in a position to give back to your trading community by teaching new students the skills you have learned over your months and years of trading.

For some, the road to success in trading only takes a few months while other struggle for years.  If you find yourself treading water or struggling to increase profits we are happy to work with you.

Surround Yourself With Successful Traders

If you are learning to play tennis you want to learn from people who are better than you, right?  This same philosophy is true for trading online.  You want to surround yourself with the type of people you want to become.

This improves your chances of learning to trade like them.

We host a live day trading chat room everyday from 9am-4pm EST.  I trade the markets and allow all of our students to watch over my shoulder as I’m trading.

There are many trading groups that you can find but it’s important to make sure you feel comfortable with the group you are with and have a good level of compatibility with the primary strategies traded in the room.  In our room we trade momentum and reversal strategies that are easy to learn.

Final Thoughts

The high failure rate in trading tells you just how hard trading really is, but it doesn’t have to be that way. You need to set up your trading like a business and have a plan to reach your goals.

If you just open an account, put money in it and start trading there is a very high chance that you are going to be putting more money in it in the near future or brushing up your resume to send out to potential employers.

Take it slow and learn the ropes with traders who have already experienced what its like to start out as a new trader.

Automated Online Trading: A World of New Opportunities

Automated Online Trading: A World of New Opportunities

Automated Online Trading: To the average Joe, the world of trading would appear deceptively simple-press a button and you can buy and sell securities within the blink of an eye. Of course, theories are almost never true in practice and anyone who has spent some time in the stock market is acutely aware of the wide chasm that is ever present between retail traders and their institutional counterparts.

For years banks and financial institutions have banked on complex algorithm based trades brought about by HFT software systems. For the most part, HFT systems have remained out of reach of individual and small-time trader mainly because of the initial expenditure on hardware and software as well as the large volume of capital investment required to keep an HFT system running optimally.
All that has changed in the recent past. Sure there is no way for retail traders to close the hardware gap between them and institutional traders but the advancement of neural networks and automated trading platforms mean that retail traders are now on an equal footing than they had ever been before.

Automated Online Trading

So how does having an automated online trading platform help a retail trader out? Let’s take an in-depth look at 3 of the primary advantages that automated trading platforms bring to the table and why they have grown to become a must-have arsenal in every retail day trader’s arsenal.

1. Copy Trading through Automated Platforms
One of the preconceived notions about trading stocks and securities is that it requires a lot of knowledge and skill. While this may have been true in olden days, with the advent of automated trading platforms, even newcomers into the field can turn over a tidy profit just by copying the trades which are being put in by stalwarts of the market. One of the best places for someone to start trading is through Forex MetaTrader 4 platform (aka MT4) as it guides the growth of a fledgling retail trader. Copy trading while not immensely profitable is the first stepping stone to understanding the trading world while riding on the coattails of people who have already made it big as an investor.

2. Making Use of Social Trading
While copy trading maybe well suited for turning in a quick profit, as one gains experience as a retail trader, there is an urge to experiment and branch out into newer avenues and try stocks from niches that are off the beaten track. This is where social trading kicks in as the presence of a social backbone mean that like-minded people can interact and share ideas with each other while they work. One of the primary benefits of having a social aspect to automated online trading is the fact that newcomers don’t ever feel alone and there is always someone around to show them the ropes. However, even experts sometimes make the wrong call, after all, to err is human- and that is why we have specialized algorithms and trading bots.

3. Algorithmic Trading
Algorithmic trading is entirely data-driven and this is why it is often considered one of the best forms of trading. While sophisticated platforms like  MT4 always provide retail traders to come up with their own set of rules and trading parameters, the real brilliance of modern automated platforms lies in their predictive capabilities. Expert Advisor bots are incredibly advanced pieces of software that can crunch through an enormous amount of market data and come up with prediction models that are incredibly close to real life trading scenarios. These trade bots can not only go through with a trade in the blink of an eye, they can also provide statistical analysis as well as visual cues like graphs and charts that make realizing the market trends easier than ever before. While financial institutions and banks have had these systems for years, the recent improvements in machine learning and neural networking means that Algorithmic trading has taken automated online trading platforms by storm.

While we went into detail about these 3 factors, there are numerous other factors at play here. Automated trading platforms take the emotions and the rash decisions away from the retail trader and make sure that the plan is followed to the letter. Automated trading platforms bring about a sense of stability in even unstable markets and it is because of them that retail traders are able to make their presence felt in the global trading scene once again.

5 Tips for Choosing Best Online Trading Platform

5 Tips for Choosing Best Online Trading Platform

Choosing an online trading platform is not easy as it sounds. It is a major commitment since you are parking your money and you need to be sure that it is reliable for your daily trading. Such a decision has to be made with a sound mind because any wrong decision can leave you deeply dissatisfied. Also before evaluating which platform will be the most suitable for you, you need to decide upon your trading decisions and needs. Once you have that in place, you will know what platform to choose.

Select Best Online Trading Platform

The following points need to be kept in mind while selecting an online trading platform. They are:

1. Accessibility
The need of every investor is very different; in short, all of them have unique investing patterns. To cater to the needs of all, we will need a platform which offers that sort of accessibility anywhere and everywhere. With the right app, you could perform transactions of all kinds. Hence, it becomes important to select a platform that blends into your lifestyle in a way that you do not have to take efforts and gives you the convenience and accessibility to trade online from mobile phones.

2. Information Accessibility
An online trading platform should provide you with all the information regarding trading under one roof. Most of these online securities trading providers’ gives you access to technical and fundamental information regarding securities. It gives you information regarding key financial data like price-earnings ratio, earnings per share, dividend yield, balance sheet and income statement. There should also be a facility for providing live news to give real-time updates on the things that are going on. This provides convenience to the investors since they do not have to change platforms to access information.

3. Value for Money
There are several charges that come along with a transaction. Nobody really tells you about those charges like banking fees and services charges. Such charges inflate your total transaction cost and can have an effect on your personal profit and loss calculations. For the same reason, an online trading platform should come with a live calculator which gives you clarity on the charges that you have to incur with each transaction. This gives you a real picture of additional costs thereby stating the true value of your investments.

4. Connectivity
You would want to opt for an online trading platform that offers a global connectivity and a wider reach. What if an investor chooses to trade on international markets rather than local or regional? For this, your platform needs to well equip with its connectivity to various international stock markets like New York Stock Market, NASDAQ, London Stock Exchange, Deutsche Boerse and many more.

5. Trading Tools
The one factor, that makes a good trading platform best is the kind of trading tools it offers. Amongst a few are the ones like Stop Loss which directly stops the transaction as soon the price of the stocks moves down sharply below an indicated level. Another being GTD or Good Till Date. This tool indicates your preferred validity date wherein you do not have to re-enter your details and it automatically gets updated. Some even have SMS alerts and notifications to inform any major changes regarding your stock. Apart from this, alerts are also sent in case there is any security or stock that fits into your category. Such tools can prove to be really helpful to the investor and makes investment easy and fun for them.

One such app that provides a trading experience like never before. Capital.com is an app uses artificial intelligence that helps you trade the world’s top companies, popular indices, commodities and many more. This app gives you real-time news, latest charts, and trends, receive price alerts, learn risk analysis and avoid any biases. This app gives you withdrawals within 24 hours, full segregated deposits and security of personal data. This app is available for both Android and iPhone and helps you trade across the world given its artificial intelligence which also helps you keep a track of your portfolio. One needs to learn the art of investment by investing smartly and by not losing money. Your investments will go a long way.

Best Online Stock Brokers for Beginners 2018

Best Online Stock Brokers for Beginners 2018

When you’re a beginner investor, the right brokerage account can be so much more than simply a platform for placing trades.

It can help you build a solid investing foundation — functioning as a teacher, advisor and investment analyst — and serve as a lifelong portfolio co-pilot as your skills and strategy mature.

What is a stock broker?

A stock broker is a person or an institution licensed to buy and sell stocks and other securities via the market exchanges.

Back in the day, the only way for individuals to invest directly in stocks was to hire a stock broker to place trades on their behalf. But what was once a clunky, costly transaction conducted via landline telephones now takes place online in seconds, for a fraction of what full-service brokers used to charge for the service.

Today, most investors place their trades through an online brokerage account. (A little lost? Check out our explainers on what a brokerage account is and how to buy stocks.)

NerdWallet offers financial tools and advice to help people understand their options and make the best possible decisions. The guidance we offer and info we provide are deeply researched, objective and independent.

We spent over 300 hours reviewing the top online brokers before selecting the best for our readers. And to help you find the one that’s best for you, we’ve highlighted their pros, cons and current offers.