You don’t have to be a qualified analyst or have a degree to trade in the market. To earn good income from trading can be an option for anyone who has a keen mind and a willingness to learn. Time will help you excel in this skill. Here is a few pointers to help beginners get started.
- Read, Read and Read
The man who doesn’t read good books
has no advantage over the man
who can’t read them.
Mark Twain
Every one of us knows this “Knowledge is Power”. We are in school a big part of our life, to do what? Yes, to learn, learn and learn. That doesn’t mean that the minute we are out we stop learning. Learning is a life long process which only ends on the last day of our life. So the best way for us to learn is to read, read and read. In order to learn about trading in the stock market, we have to find good book on stock market trading.
- Do a “Phantom” Trading
If you are new to stock market investing, you might want to do a 3-month trial trading. This may help you get ready for the real investing you would like to go into. You will have to do the same thing similar to what you need to do if you are doing real trading. Pick a few stocks and start studying the company background, history, dividend payment and trading price for the past 10 years. Keep a record of these stock and see how you do in 3-month’s time. Once you are confident, you can start your first trade.
- Join the membership of a live website
To do both, the “phantom” trading and actual trading, it is better to shop around for a good trading live website to join as a member so that you can use this site to help you track your portfolio. Most site might have a one or two- hour time delay, so, you can either do your trading online (this usually charge very low fee) or with a registered trader.
There are a lot of trading online websites available for you to join as a member so that you can use their site to control your portfolio. Most of these sites has a platform for forum, where investors can communicate and share their views on stocks and market situation.
- Study the stock you want to invest
Background check on company, share prices for 10 years, do a search on the history of the companies you intend to invest in. Information are usually available on trading companies websites. Check them out and keep your own journals.
- Diversify by concentrating on only a few shares
Diversification is very subjective. You may concentrate on a few stocks but avoid putting all your eggs in one basket by choose different category of products. I personally felt that one should not over diversify when investing.
- Keep track – Create your own personal "Watchlist"
Use a reliable and near real time site to create your "Watchlist". This way you can keep track of your portfolio easily and you can also have a quick glance of how the stocks are doing every trading day. You may also want to keep a separate "watchlist" for any potential stocks you plan to purchase. By doing this, it will help you keep track of the price fluctuation in order that you can make the right decision at right time.
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