6 Easy Ways to Get Ready for Online Trading – Applicable for any business0
Nowadays it’s easier than ever to have it all. The world is full of opportunities for you to be passionate, do what you love to do, without having sacrifice making real money. How many times have you thought ‘wouldn’t it be great if I could go there or do this’, but stop yourself because you are afraid you won’t be able to support yourself?
Online trading is more robust and more popular than it’s ever been across the globe. Platforms exist that facilitate trading assets such as stocks, indexes, commodities and/or currency pairs in global markets. When opportunity knocks don’t just stand there, open the door! Figure out how to travel across South East Asia while trading shares of Deutsche Bank.
Your ‘to do list’ can easily look like this:
Tuesday: See Machu Picchu
Wednesday: Online Trading
Learning how to trade online is easy. In fact you can do it in 6 simple steps.
Step 1: Decide Your Investment Goals
“Set your goals high, and don’t stop till you get there.”
The first thing you need to do before you start screaming buy/sell at your computer as you trade online is figure out what your investment goals are? Do you want to make some money to go on that big trip, buy a house, a car, or are you just a thrill seeker looking for the next rush? The answer to this question will help determine what asset you’re looking to trade, and in what time frame should you expect to see returns. This will really give you a good direction to begin with.
There are tons of material online to help you get started. In fact, most brick and mortar exchanges as well as governmental regulatory bodies such as the Australian Prudential Regulation Authority (APRA) have information on how to start figuring out your investment goals.
Step 2: Decide What to Trade
“Whenever you see a successful business, someone once made a courageous decision.”
Peter F. Drucker
Once you decide what your investment goals are – what you are aiming to achieve – you’ll have a better idea of what platforms you want to use and which assets you want to trade. For example, if you have a 10 year plan to buy a new house, you might want to look into more vanilla options such as ETFs. But, it is best to weigh all the options.
A growing area for online trading is binary options. Binary options are fast pace and provide potential high returns in a very short time frame (of course the potential return for each trade is strongly correlated with the associated risk). These options are also very simple to understand. Essentially you look at the price trend of an asset – stock, commodity, index or currency pair – and decide whether you think that trend will go up or down.
Step 3: Understand How Markets Work
“To know values is to know the meaning of the market”
Before you can accurately forecast if the market trend for an asset price will go up or down, you first need to understand the market. There are basically two ways to look at the market – fundamental analysis and/or technical analysis.
Fundamental analysis tries to interpret the market in the context of external events. How does a hike in interest rates affect the price of oil? Technical analysis looks at charts of market data to analyze the sentiment of the market, whether it is bullish or bearish. Most successful traders will use a combination of the two.
Step 4: Strategies for Success
“A goal without a plan is just a wish.”
Antoine de Saint-Exupery
A good strategy is what takes the goal you wrote down in step 1 and turns it into something achievable. Almost all strategies are have methodologies for noticing the right setup and taking action when the opportunity to make a big win is in you favor. Of course all this rests on your understanding of the market.
There are many great strategies out there. Some deal specifically with stocks or currency pairs and some take a holistic look at the market. Make sure to match the correct strategy with the correct asset. If you can adopt more than one strategy and make it work for you, you’ll be miles ahead of 99% of the other traders out there and well on your way towards consistently winning trades online.
Step 5: Practice, Practice, Practice
“For the things we have to learn before we can do them, we learn by doing them.”
As with anything in life, if you want to be good at something, you need to practice. Practice makes perfect. Through repetition you’ll begin to get a keen eye for which trades have the potential for real winnings and which are too risky for your tastes.
If in step 2, you decided that binary options are the right online trading vehicle for you, then you are in luck! Most, if not all, of the most highly regarded binary options platforms let traders practice on free demo accounts. Free demo accounts offer novice traders and experienced traders learning a new strategy the chance to perfect their techniques with minimal risk. You are able to trade with real market data using fake money. There is no better way to really get the sense of what makes a winning trade.