Finance

Stock Exchange Trading Overview of Different Strategies and How to Get Started

If you want to get involved in stock exchange trading, you don’t want to jump right into things. Beginners should always start small and focus on – at most – two or three stocks per session. Also, those stocks should not make up your entire portfolio. Don’t forget to diversify with other types of investments. ETFs offer a good opportunity to invest in a small chunk of several popular stocks with one investment instead of each stock. A savings, CD, or money market account with an online bank is ideal as well.

One of the first things to do is spend time looking at the stock exchange indexes like S&P and Nasdaq and familiarize yourself with as many companies as possible. Don’t just focus on the big names like Amazon, Apple, and Google. There are hundreds of other companies. You don’t have to memorize them all. Look over them for an idea of what kinds of industries (healthcare, retail and commerce, entertainment, tech) are performing well right now.

When it comes to stock exchange trading, many beginners get excited over penny stocks. Don’t be one of those people. You might as well spend your money on lottery tickets since the odds of hitting the jackpot with a penny stock are just as low. Some of the stock exchanges have even de-listed penny stocks.

Stock Exchange Trading With Daily and Longer Term Horizons

On the other hand, day trading might be something you find appealing later on, as you gain more experience and knowledge. It’s nothing to start with right off the bat, though. A day trader is an individual who puts a lot of focus on price volatility and the average daily range. He or she often closes all the trades before the trading day officially ends to prevent holding open positions overnight.

Most traders are not interested in playing around with stock exchange trading. They would rather wait around until the time is right to collect rewards. This reward can take years or even decades. Some experts recommend buying in thirds. Divide the amount of money you plan on investing by three. Then pick three different points to buy some shares, whether at regular intervals (quarterly, monthly, etc.) or based on company events or performance.

Regardless of how you do the trading, or which strategy appeals the most to you, make sure you educate yourself as best you can. It’s helpful to have a stock exchange trading platform by an online broker. For example, Zacks Trade – that offers useful tutorials and resources for getting started and making informed decisions.

Posted in Banking and Investing, Investing and tagged , .

Leave a Reply

Your email address will not be published.