Trading online has become increasingly popular over the last decade. One of the main reasons for this is because it has become so accessible and easy to do. Many online trading websites will not only let you trade stocks and shares online, but you can also dip your toes into Forex, CFD’s and spreadbetting. As well as this, there are loads of utilities like practise accounts and mobile apps that can help you along until you are ready to become a fully fledged trading pro. There are a few things you need to consider when you are going to start up an online trading account, but once you have these refined, you should not find it hard to start to make money online by trading.
Picking the right website
Some trading websites specialise in certain types of trading, or some like CMC markets are all rounders where you can trade in any instruments and investments you want to. Before you start to trade, think about what it is you want to trade in. There are a few websites who will try and draw you in with special offers, but keep a close eye on these – it may turn out the special offer is useless to you and they are recuperating the money back in their rates.
Other things you need to consider are based on the functionality of the website. Does it have a mobile app? This is incredibly useful if you think you may not be able to get to a laptop through the day, as even the seconds count in the trading world. Also, does it have a practise mode? This is incredibly handy if you want to find your feet for a few weeks without losing any money. Most good online trading websites will now have a practice mode.
How much and how often are you going to invest?
Not only is it a good idea to think about how much you are going to invest, but think about how often as well. You can either invest one lump sum, which should be something you can afford to lose in it’s entirety, if you can invest monthly by direct debit. If you invest monthly by direct debit, you have the added benefit of spreading your risk. This works because the prices will fluctuate on each investment date, so regardless of if you invest on a date a few times when the rate of the trade isn’t that good, you can still make this up by investing on a date that it is very good the next month.
Think about a strategy for your money, and be realistic when thinking about expected returns.
Research what you are going to invest in
If you are new to online trading, then you have even more reason to research all of the nuances of certain stocks or trades. CFD’s and spreadbetting can be confusing, so it may be best if you are an absolute beginner to start with stocks and shares and see how you get on there. If you are going to invest into anything, make sure you fully research it beforehand. Many online trading websites will have full profit and loss information, and also company or fund information. Outside of this, there are also many ways that you are able to track how a company is doing. All company accounts for companies floated on the stock market are available to view online in some form or another.
It may sound surprising, but the news can also affect the stock market greatly. If you are investing in one single company, set up a news alert for them on your search engine of choice. This can also work for CFD’s and spreadbetting, as if you have chosen to bet against a certain company or trade, then you can see how negative news impacts. It can also be used as a resource for Forex trading, as many components of international news such as trade deals or sanctions can have a way of making certain currencies go up and down in price. Try and use the websites practice mode first to match all of this up.