Get in the Trading Game with a Buddy
Getting started in trading can be overwhelming at first. There is so much information out there, and even more sites out there looking to part you with your money. This prevents a lot of people from entering the markets themselves, and it robs them of the chance to start making more money. You don’t have to fall into this category of people. It is quite possible to make money trading, but do keep in mind that it is not easy. Just remember to take it in small steps and don’t progress until you have mastered the last part of the process.
So where should you start? That’s the question that so many people get hung up on, but it’s actually one of the easiest trading decisions you will ever make. Start with what you know. You have interests and hobbies, you have things that you are knowledgeable about. List what those things are, and then find a way to monetize them through your trading. If you like to follow international politics, for example, perhaps trading currencies in the Forex marketplace is the right choice for you. If you are a fan of technology, then maybe tech stocks like Apple and Google are the right choice. Almost any interest can be turned into a trading opportunity for you if you think about it enough. It’s best to stick with what you know.
Let’s assume that you decide you want to trade things that revolve around energy. You are still left with a lot of choices. Should you trades stocks, commodity futures, options, or binary options? Really, this depends on what you are comfortable with. Many advanced traders use a combination of these things, but you shouldn’t start out with that. Pick the one that seems easiest for you to understand and the one where the least amount of money is at risk of being lost and start there. Trading always involves risk, but some forms have less risk than others. Futures have a lot of risk, but big rewards. Options have little risk, but there is a big minimum threshold of money to invest to get started. Stocks and binary options have little risk, and stocks cost a little more to get started in than binaries do. Both of these can have big rewards for little risk, but binaries do so more often on a regular basis. Still, the choice you make will be completely dependent upon your personal situation and your financial status.
Next, you need to figure out where you should trade. There are tons of brokers out there, each with their own set of perks. These benefits will be determined by the type of trading you are doing. Binary options sometimes will have cash bonuses for you on your first deposit. When it comes to other types of trading, rewards are rare, but you do want to make sure that the fees are as small as possible. With currencies, this is the difference between the bid and the ask–called the spread. Usually, it’s a fraction of a penny per dollar, but it does add up over time. With stocks, it is a fee per trade. Depending upon what you are trying to do, it can be as low as $5 per trade, but if you are trading in real time, it can be much higher. When you trade large amounts, this cost is offset, however. Futures and options generally have a contract fee. Binary options brokers make money off of the discrepancy between the loss cost and the profit payout. Figure out which makes the most sense to you and then proceed from there. All brokers need to make money some way, but how much of it comes directly out of your pocket is dependent upon what you’re trading and how much cash you are using to do so.
You can be a profitable trader, but it requires research before you begin and this element should be constant once you are active. Active trading is a tough job, but the more you learn and the more experience you gain, the closer you can get to making a comfortable living at this. It also happens to be a lot of fun and very rewarding if you do it right.