Online Stock Trading: Stock Trading 101

Online Stock Trading: Stock Trading 101

Online stock trading is nothing but conducting the stock trading by means of the internet. The wonder of the Internet is the opportunities it provides to people where previously there were none, or where the opportunity was severely restricted.

With easy access to online stock trading, nowhere can this be exemplified more than in the world of stock trading, to make (or lose) vast sums of money from trading stock listed on one of the many stock exchanges around the world, everyone now has the skill.

What do you need to get started?

Following requirements are essential to get started in the world of online stock trading:

  • Access to a computer
  • Internet connection
  • Money to invest

In order to open an account with an online stockbroker except for these, however, two additional very important elements that you’ll need include the discipline to know when to buy and sell stock, and an investment plan that matches your chosen stock purchases.

Your investment strategy

Online stock brokers unlike most stock brokers rarely provide clients with advice on which stocks are buy/sell/hold suggestions. That said, some do offer off-line services for this.

Accordingly, you may wish to avail yourself of this service if you are new to stock trading, otherwise you will require researching your stock buying/selling options yourself.

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If you are looking to research which stock to buy yourself, you should take a look at purchasing online stock trading software programs to help provide you with all the technical information.

For example charts, real time prices, information sharing that you are going to need in order to make an knowledgeable investment decision.

Types of Online Stock Traders

In essence, there are four types of online stock traders:

  • Short-term traders who ordinarily hold stock for a week, but this can be up to one month
  • Medium-term traders who hold their stock anywhere from 1 month to six months
  • Long-term traders who hold their shares for one or more years
  • Day traders who buy and sell stock in the same day.

How to start Online Trading

When you have opened your account with an online stock broker, deposited your money with them, picked the stock you want to buy, and the method of trading you are going to conduct, all you then require doing is to press your mouse a few times and the buy/sell order for that stock is complete.