Stock trading and investing can be a lucrative full-time or part-time occupation if you have enough experience and knowledge of the market, company fundamentals, technical know-how, and many other aspects. Whether you are an investor or a trader depends upon the frequency at which you are buying or selling stocks or other assets such as cryptocurrencies or fiat currencies.
If you are a beginner, you should go through this guide to learn the basic aspects of trading and investing in stocks.
What Is Stock Trading?
Stock trading involves buying and selling of stocks on daily price fluctuations. The traders have a short-term outlook on the price movements of stocks in the market. They make a few bucks on favorable price movements in a few minutes, hours, days, or months.
There are mainly of two types of stock trading:
- Active Trading and
- Day Trading
A trader is said to be an active trader who makes at least 10 or more trades in a single month. These kinds of active traders use strategies that involve timing the market. They take advantage of short-term events affecting the market sentiments on the company level or overall market. They usually buy and hold stocks for a week, months, or a few months to make a profit.
Day traders employ strategies on the basis of range (based upon supports and resistances), news, and other factors to make multiple profits throughout the day on the basis of the price fluctuations of stocks. They usually choose those stocks that have high liquidity. Day trading usually involves buying of stocks and selling them within a single trading day.
How To Start Trading Stocks?
If you want to trade stocks or any other asset such as cryptocurrencies or forex, you must have an account with an exchange/broker. To start trading stocks, there are 6 steps involved:
Step #1: Open a Brokerage Account
If you want to buy and sell stocks, you have to do it through a broker. That’s why it is important to open a brokerage account. It will enable you to hold investments. To open an account, it’ll take just a few minutes.
Step #2: Set a Budget for Stock Trading
No matter how talented you are in stock trading, you mustn’t allocate over 10% of your portfolio to individual stocks. This is because too much exposure of your savings to high volatility may cause irreparable damage to your financial viability.
Do’s and Dont’s of Stocks Trading
For managing risks of trading, you must also follow these dos and donts:
- You should invest/trade only that amount of money in stocks that you can afford to lose.
- Don’t use any kind of money that you have earmarked for making essential payments (such as tuition or down payments) or near-term ones.
- If you don’t have a healthy emergency fund, then decrease the 10% allocation of your portfolio to individual stocks. In fact, try to invest 10-15% of your income into the retirement savings fund.
Step #3: Learn how to use Limit and Market Orders
Once you have opened a brokerage account and also sorted out your budget, you should use the trading platform for placing orders for stock trading. Many options of iorder types will be displayed to you including:
- Market order: This purchases or sells a particular stock at once at the best available price.
- Limit Order: You can set limits for buying or selling a stock. The limit of a buy order is the amount of money you are willing to pay. This means the buy order will be executed only if the price of the stock goes down below that certain amount.
Step #4: Practice Stock Trading with a Virtual Trading Account
You can open a virtual trading account at leading brokers such as Interactive Brokers and TD Ameritrade. With the help of virtual trading tools, you can have a hands-on, low-pressure experience of trading.
Step #5: Measure your ROI
Your ROI must be more than that of the benchmark indices including Standard & Poor’s 500 index, Nasdaq composite index, and other smaller indices. After investment and curtailing the associated fees of trading, you must measure the return offered by your stock investment. This will help you to know whether you are on the right path.
Choose Cryptocurrency Copy-Trading Bots to Increase Crypto ROI
Cryptocurrency Trading Robots (such as NapBots.com) automatically scan the market in real-time and trades for you. They run 24×7, which means that you can keep earning your passive income even when you are sleeping. This gives you an edge over other investors as it enables the bot to book profits on your behalf when other investors are sleeping.
Smart crypto investors always remain prepared to get the best of a big market move. They don’t wake up suddenly. To remain alert round the clock, they use cryptocurrency trading bots so that they don’t miss any big market movement.
NapBots.com is a Trading Bot, cloud-based platform, on which you can connect to major exchanges such as Binance, Bitmex, Bitfinex, OKEX, Kraken, Bitstamp, and Bitpanda.
The best thing about the Napbots trading software is that you don’t have to monitor charts and candles to predict your next move. Any novice trader with zero skills can also start trading like a pro and earn money with this unique trading tool. Let Napbots take full control over your trades in just a few clicks. Now, sit back and enjoy earning money.
You may also check “Napbots Review – Simple Way To Increase Your Crypto Returns” before taking the plunge.
What’s so special about NapBots?
NapBots crypto trading software is special because it comes with:
- A unique trading algorithm that processes market data for you
- A unique crypto trading bot library so that you can create your own mix of trading strategies
- Autopilot mode that enables you to automate trading 24×7
- An easy-to-use interface so that you can copy the proven strategies of NapBots to make successful trades and make money
How does NapBots help you to Make Money?
Step #1: Connect to one of the available trust exchanges.
Step #2: Select from the unique list of performing Bots of NapBots
Step #3: Choose a plan that suits your investment style
Once you have completed these three steps, NapBots is ready to trade cryptos and earn money for you. Happy Trading!
Why Choose NapBots?
- NapBots offers complete trading automation solutions through the use of its own tested trading strategies; offering quantitative trading strategies previously reserved for hedge funds to the public.
- The setup and installation process are easy. So, the non-experts can also use it. The simple and special approach of NapBots helps it provide you with excellent ROI.
- The team of professionals behind NapBots has extensive experience in the financial market. They have put their years of experience in place so that you can easily automate the management of your funds with no technical skills. This service can run 24/7 and work as your passive source of revenue even when you sleep.
Are You Ready To Start Automating Your Passive Income Now?