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Stock Trading Basics

Jun 13, 2008
The growth of online trading websites is increasing unfailingly day by day. Similarly there are thousands of do it yourself resources out there as well. Nevertheless how to learn stock trading business? Where can you learn this business? Who will teach you about this wonderful business? It may sound a difficult task to you. Nevertheless, you can learn stock trading if you follow the tips discussed in this article.

This doesn't mean that you shouldn't speculate, but rather you should only speculate with money you can afford to lose. You don't want all your wealth to disappear in a single bad gamble. And you certainly don't want to play the stock market with borrowed money, unless someone else will also be paying for your losses.

You can visit a library and check if there are any guides or books on stock trading. If you do not have a library card then you may visit the library and note down the names of the books you find worth so that you can buy them from bookshops. You may take notes on the basics of stock trading and things like stock trading strategy which will enlighten you with the knowledge on where and how to invest your money.

This means you want to spread out your investments to minimize the impact any one bad thing will do to you. Keeping at most 1/4 of your invested money in the stock market, with the rest split evenly between very safe investments like bonds, interest bearing accounts, and precious metals. Those are stock trading basics good traders learn before they get anywhere near making a trade.

Now, the best place to invest in stocks is in companies that you have a good feel for the performance of, because you work in the same industry. Notice I said "invest," not "speculate." When investing, the safer your money the better.

There is a lot of garbage metrics and stock trading tools out there for investors to play with while they try to guess where the next big thing will be. Some of them even look like they work, for a while. And many people have gotten rich exploiting the garbage metrics, usually by selling them to new and inexperienced investors as a "sure fire, get rich quick" scheme. Don't fall for it. Except for a few very lucky people, everyone gets rich slowly in the stock market.

Now if you are sure that you have learnt the basics of stock trading, the market and the techniques of trading you can get started. The only other thing you need now is capital. Please be sure that you can afford the money you are going to invest whether it is your spare money or some other money. You may invest the money you have after paying all your bills or the money you get from your part time jobs.

The last thing you have to know is that it costs money to make transactions in the stock market. Broker's fees can nickel and dime traders to death. So get in the habit of setting and forgetting your stock purchases. Especially for speculations, buy once and let it ride until either everyone begs to buy your stake or the company folds. And those are the stock trading basics.
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To find out how more about best stock trading and trading courses please visit my site. Good Trading!
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