Online stock market trading is the type of speculation where education, insight, and skill can slightly improve your odds at winning. Risk management is a skill that often needs to be learned. Reducing your online trading risks will increase the odds for success.
Stay focused on what you need to learn and the actionable tactical steps that will get you there. It’s important to note that money is just a byproduct of wise trading methods. Learn to determine the expedient path to making money versus being caught up in the “get-rich-quick” schemes that are a dime-a-dozen online.
Invest in penny stocks
You will certainly have a greater success rate if you invest in “penny stocks” instead of scratch-off lottery tickets. So shift your small investments from the latter to the former. Why bother investing in stock market heavy-weights like Procter & Gamble, IBM, or even Apple when you can buy so many more shares of a penny stock for so much less?
A couple hundred dollars will go a lot farther when you buy tens of thousands of shares of some company that specializes in a new product that shows promise. So learn all you can about each company before jumping in; but once you do, purchase as many stocks as you can afford and track your success weekly.
For example, if you are able to buy 1,000 shares of one of these growth stocks, every time that stock goes up $1 you have just added $1,000 to your coffers.
Trade versus invest
Many investor consultants believe you can make more money quickly by trading versus investing. This space is really for the individual that wants to be active in making his money versus passively waiting for the stock market to experience an uptick.
Important to remember here is that you want to make consistent, small short-term gains rather than trying to hit a home run on every trade.
The idea in trading versus investing is to recalculate your thinking. Don’t marry a stock, marry the idea of making money through trading stocks. Also you should trade only when you see a clear, easy, and identifiable advantage, because without that edge, your odds of success are no better than a flip of a coin.
Traders who are looking for the quick turn every time are the least successful.
Keen eye on early trading
Early trading often dictates what’s likely to occur over the course of the day’s session. This does not mean a trader will know exactly where the market is headed, but rather the information available at the opening bell can help determine if the day is likely to be ranging, trending, sedate, or volatile.
The reason the opening is so important is that the information from overnight and international markets is being absorbed and acted on by groups of professional traders who reveal where they think the next day’s trading is heading. They have calculated the financial news and trends and are making their best guesses. Individual investors learn to follow their lead.
According to Investopedia, day traders need to watch three key areas:
— How much activity is taking place (who, how much, and in which direction)
— If there is confidence in the move
— Where likely failure or surge points in price reside
Many online investors also like to consult with investment advisors to learn the ropes from people who have developed a successful track record in online investing. Getting rich quickly online is an art, not a science. It takes some education and an innate sense of where the markets are going, and when. The above are just some of the better practices that have shown success.
Rather than spend your time on get-rich-quick schemes, investigate each area discussed here and see which ones are best for you. You may not find instant riches, but wealth is something that can be attained in a short amount of time by practicing what’s worked for others.