Trading Stocks Online - 10 Steps You Should Follow to Get Started Day Trading

Online Day trading - Sounds fancy or prestigious in some way. If you talk to someone who has been day trading online for several years, odds are that what they tell you will be over your head if you are just beginning your online stock trading. This guide is meant to serve as a stepping stone for beginners to help you get started, but also a "refresher course" for the seasoned day trader, as many of the trading ground rules rarely change. I've been involved in stock trading online for a couple years, although somewhat sporadically. Even for the beginner or professional, there are many resources available to help improve your "sixth sense" for the market.

1. Services for Trading Online

There are many services where you can set up brokerage accounts to begin day trading. Many have similar features, while each may expand a little in different areas. The best thing to do when finding a service is to visit the website and just try it out. See how you like the look and feel of the site, and use the resources that the site provides to get a feel for the main account area, and also the trading area. The service you choose needs to be familiar and comfortable to you, so that when you are making your trades you are confident with using the service.

2. Set Up Your Account

Well, this is an easy part of the formula. The worst part of this is the long forms that you are supposed to read concerning the markets and notices, and other legal forms. I would recommend printing this information and reading through it so that you will have a better understanding of the rules for the market. Once you have your account activated, there is usually a process to add a bank account and get it verified so that you can fund your account. This may vary with brokerage, so you have to read the rules to get set up.

3. Get the Feel of the Trading Area

This part is very important. Most online brokerages have tutorials and sometimes even videos that show you the basics of their site. Always make sure to look through the Help file for the brokerage if you get lost or do not understand certain terms on the site. After all, browsing and reading the help section is usually the fastest way to figure out anything that you don't understand on a website.

4. The Three "R's" of Trading

Research, Research, and Research some more! It sounds redundantly repetitive, but don't be fooled into thinking you can win this war (see next step) without knowing what you are up against. Knowledge is the best tool in your arsenal, so make sure you are doing your homework!

5. Choose Your Warriors

You are the General. The investments that you choose (in this case the companies you invest in) are your warriors. And this is a battle that you will want to keep a close eye on. It is your hard earned money at stake. Sometimes you may lose a battle, supposing that the company you just invested in goes belly up, but the whole point is to make sure you win the war! You are not just investing to have something to do during the day (or are you?). This money may be your retirement fund if that is what you have planned.

6. Practice Trades - Break Out the Play Money!

This step is actually quite fun. If you will check out my resource box below, you will find a link to a website that has many resources on it, including a place that I use where you can set up a "play money" account and see how you do with investing. So a company you bought into took a dive towards the big zero? That's alright, there is a handy dandy reset button to start over! Too bad you can't do that once you get into the real money...

7. The Opening Bell

I have heard many people say that they make their trades before the opening bell of the day, because trading during the day can get very emotional for the investor. Don't let your emotions be a factor in your investments! If you follow my guidelines and do your research, you are much better equipped to make decisions without emotion. As I mentioned earlier, the best tool you have on your side is educating yourself about the market, the companies, running the numbers, and knowing your exit strategy. You will begin to develop your own system of investing and studying as you go along.

8. Think You Got It? Now for the Green!

Here's where the magic happens. Once you have educated yourself on all the points I have made, and any other areas you find you need to know about, you can fund your brokerage account and get started with your investments. If you feel more comfortable playing it slow at first, then just start out with a small portion of your total investment capital and go at your own speed. Just remember to never get in a hurry, and never let your emotions affect your investment decisions.

9. Risk versus Reward

In the world of online stock trading, there is a delicate balance that poses a decision all investors must make. This is the decision of Risk versus Reward. Under most circumstances, the more risk you take, the more reward is possible to achieve. However, with more risk, you could also end up losing a lot more of your hard earned money. Each person must decide for themselves the amount of risk they are willing to take on a trade, and, as mentioned earlier, this will affect the choice of companies that you are willing to trade on. Which brings us to the final (and probably most important) step in this series...

10. Keeping Your Sanity!

Now I know this sounds funny, especially to anyone who is new to stock trading. But on a serious note, some people take on too much risk while looking for that great payout. To many new stock traders, the idea that your money is floating around out there in cyberspace and it's fate is attached to some company that you may have never seen, can be scary. Balancing the risk and reward equation to a level that you are comfortable with is something that just may help you sleep better at night.

So now that you have a step-by-step idea of how to get started, all that is left is to go for it. But as a good rule of thumb, I always tell anyone looking for an investment that they should never risk more than they are willing to lose. And of course, if you don't feel comfortable making the choices of investments, stay in that practice zone until you are comfortable with it. If that still does not help you, you should seek the advice of a professional broker, and perhaps the service you choose has people available to consult with you. Always use all the resources that are available to you, and your investments will be based on a very well researched decision.


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Online Stock Trading - Research and Limit

Online stock trading is a convenient way to make stock investments, but there is a certain art to online stock trading, and there are plenty of companies who can help and make it a lot easier. The presence of an online stock trading community makes it much easier to do things such as, day trading, hedging and the use of intraday stock trading system.

So, are you intrigued online stock trading but not sure how to get started? Just as with any type of investing and trading, you must first define your overall goals. When beginning the process, it is important to find a reputable company, because online stock trading can be lucrative, but if the company you trade through doesn't have a good reputation you could lose a lot of money.

Sudden Market Fluctuations

There are certain stocks that are extremely volatile - which means their prices can rise and fall rather quickly, and if investing in these stocks over the long term, you may lose money or barely break even. However, what if you were to take advantage of these sudden price changes? This is the basis behind day trading, and online stock trading makes day trading even more accessible to the investor.

What if you were able to quickly purchase a certain stock during a sudden price decrease, and then sell it once the price rises again? Online stock trading makes this kind of quick action possible and can help multiply your investing profits.

Research is Important

Yes, online stock trading requires only a few mouse clicks; however it is important to not become over-zealous. Because you are slightly removed from the process of actually handling your money, it is easy to forget that one wrong click can cost you thousands of dollars.

Instead, approach online stock trading as you would any of your other investment endeavors. Research is the key to making sure you take full advantage of this - that and the ability to make quick decisions.

Limit Order vs. Market Order

To help you with your online stock trading, it helps to understand the difference between a limit order and a market order. A limit order helps you because it lets you buy or sell at a set price - you literally set the limits. A market order is one where you don't have control over this. To be successful at online stock trading, many prefer doing limit orders.

When it comes to online stock trading, the more informed you are the more successful you will be. The ability to analyze and make quick decisions is an art, and the sooner you master it, the better.


By Ryan Lee


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Stock Trading Online - 3 Crucial Things To Look For in an Online Stock Trading Company

When I first started trading stocks online, I thought all online stock trading companies were basically the same. But, over time, I have learned a few things that I wish I had known to look for in a company when I first started. Here are a few of the things I now look for in a stock trading company:

1. The Cost Per Trade - Some stock trading companies have incentives or promotional discounts when you do a certain amount of trades per month or discount fees per trade.

$5 - $10 per trade may not seem like much money at first, but it can add up quick. Think about it: You decide to buy a stock - $10, you decide to sell the stock and buy 2 other stocks instead, sell - $10, buy $10 & buy again $10. You have just spent $40 trading and you just started. If you had started with a company that only charges $5 per trade, you would have only spent $20 on that process. It's tricky enough to make a profit trading stocks online, you don't want to start out in the hole just trying to break even first.

2. Reputable Company - Make sure the company you are dealing with is reputable and has a good reputation. You don't want to be wiring large amounts of money to a company that might not be returning it to you. Check with the Better Business Bureau before you apply. Also, do a little research online and see who the company is recommended by.

3. Simple Navigation - Graphs & More - One thing you want to make sure of, is that the stock trading interface is easy to navigate and understand. Sometimes, when trading stocks you need to quickly look over graphs and current quotes and then quickly buy & sell. Getting tripped up by an unuser-friendly interface will cost you money.

You should be able to apply with a stock trading company online and then be able to check out their interface before you deposit any money into your account. It's worth the extra time to check out the site completely before you make your deposit.


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Online Stock Trading

Ask the wealthiest of Americans what their secrets are to financial success, and they will most likely say that one of them is stock trading.

The 1980’s were particularly helpful to big-time stock investors – those who could afford to invest thousands upon thousands of dollars were able to double, even triple their incomes. Luckily, for the smaller investor, this is not the case anymore – the stock market has become more open to even to those with limited funds. Almost all companies now offer 401k accounts that enable all employees own a portion of the company. And thanks to the Internet, the market is even more open now. Online stock trading is enabling millions of Americans to make money in the stock market, even with minimal investments, without leaving their homes or offices.

Beginnings of Online Stock Trading

The 1990s saw the start of online stock trading when day traders ran up Internet stocks. These people made online trading so popular that nowadays, virtually anyone can trade stocks online.

Getting Started

To get started, you need to choose an online stock trading company, pay the membership fee (which can range from about $5 to about $20), and set up an account either for IRAs, money market funds, mutual funds, or trading of regular stocks.

Once you have set up an account, you can begin trading and managing your funds. Most online stock trading companies provide you with tools so that you can access the market in real time, quickly examine trends, and trade instantaneously.

Succeeding in Online Trading

Remember to regularly view your portfolio online. You have to make full use of the online trading company’s research facilities in order to maintain and grow your investments. Download the relevant financial reports that come for free with your membership. It is also wise to study the histories and performance evaluations of all stocks you want to trade.


By Josh Riverside


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