It has been has been a year since I first hit the buy button, and boy have I made some mistakes. I pretty much jumped in and started to buy with no understanding of what the hell I was doing. I made the mistake of not studying and researching trading, and I paid for it. Trading can be intimitadating being that you hear all of the stories about people losing there money. Trading stocks is a very risky game, but it's not as risky when you know what you are doing.
Fast forward to a year later in my trading career, I have cut my losses and started gaining much more that I lose. I am excited about my growth and potential earnings in the near future. I want to share as much knowledge as possible about trading stocks to my readers. I hope that I can prevent you from making some of the mistakes that I made early on. Listed below are five things that would have made my life much easier when I first hit the buy button.
Find a Mentor - I cannot began to tell you how important it is to find someone who is more seasoned and knowledgeable than you. A good mentor can help fast forward you through the struggles that traders go through. Most people choose brokers to teach them the game, but some brokers are known to take advantage of newbies. Find someone such as a friend or family member who knows the basics of trading and are actively doing so. You can also reach out to people such as myself that doesn't mind teaching you what I know. I am not an expert but I am willing to share what I learn with you as I go along.
Learn How To Research Stocks - Before you buy anything learn how to research stocks by looking at the companies history. Learn trading terminology such as volume, volatility, and bearish and bullish. You need to know what these terms mean so that you know what you are looking at. You will also need to learn what markets are hot at the moment, it will make things a lot easier when choosing stocks. The best way to do this is find a good website to use for research. I personally use www.fnviz.com. This sit has all of the information that you need such as what stocks are making the biggest gains, losses, and the latest news. It is all free to use unless you upload to a subscription, which gives you so much more insight that will help you trade more efficiently.
Choose Inexpensive Stock - As tempting as it might be, do not jump into the trading game trying to score big with the big boys such as Apple, Facebook, and Amazon. They are great stocks but they are to high risk for a beginner. You could lose a lot of money real fast if you don't know what you are doing. Start out with stocks that are between the range of $10 and $22. These stocks are easier to trade and invest in. They are not as risky and I have had great luck with stocks around these prices. Remember, I am sharing what I have been through and what has worked for me as a newbie. When any kind of news hits with the big companies, they take the biggest losses. Play it safe when you are just starting out.
Learn How To Read Stock Charts - My stock game changed dramatically when I learned what all of those lines meant. The chart is the most important tool of them all, you get to physically see exactly what your patiently stock has done over a period of years. What you are looking for are trends such as... are they up or down, how long have they been up or down, and what time of year do they normally go up or down. If you are actively watching your chart for the day, you can tell when your stock has taking a loss or a gain. This is crucial information as it pertains to when to sell or buy, so please learn how to read the charts.
Choose A Brokerage - Now here is the final and most crucial step! You have researched trading, found a few companies that you want to invest in, now you need the resource to do just that. I don't like brokers to trade for me because its to hard to find a honest one, so I trade on my own using a the brokerage site www.robinhood.com. Most sites charge you fees to trade making it so hard for you to make money, and you would probably trade less trying to avoid the fees. If you decide to go with a broker or a paid brokerage, be sure to do your research before choosing. Robinhood has been great for me, and I highly recommend it. If you decide to signup just click on the link in this paragraph so I can get my free shares lol.
These are the five steps that I had to complete before learning how to trade at the level that Im on now. I did not do it in this order because I had to learn the hard way, and I hope that this will give you a great start. If you have any questions at all about trading, I will be happy to help you as much as I can.