Thursday, June 18, 2009

Trading Stocks Online: Does the Ease of Use Make it More Dangerous?

The majority of American homes have at least one computer, and of those, most are connected to the Internet for at least one hour or more each day of the year. Because of the ease of having the entire world right there at your fingertips, more and more business is conducted from the home - from ordering Junior's birthday gift to performing job duties. It was only a matter of time before the financial world started grabbing some of the Internet action- now a large portion of every day's trading actions are performed online. Whether you go through a broker or execute your trade on your own, online trading can be an interesting way to manage your investments.

Because the Internet is there twenty-four hours a day, it can become very easy to get carried away by the whole online trading concept. Before you even log onto the first site, and before you even look at the first trade online, there are some things you must know and understand. Knowing these basics can make your online trading experience satisfying and hopefully, financially rewarding.

If you have never worked with stocks before it might be advisable to work with an online broker before going out on your own. The stock market should not be a learn-as- you-go experience, especially not with the current state of the economy. Do your research if you wish, but work with a broker until you are more confident in your own abilities.

You should talk with your broker about your own personal investment goals. Know what all of the risks are when dealing with the stock market. And by all means, know your own limits. Do not try to trade above your financial capabilities- if you choose the wrong stock, or the market fluctuates you can put your family in real financial danger.

Online trading can allow you to research and buy your stock in one simple step, or to do the research only, using a broker to buy the actual stock. Beyond the other tips that apply to all stock trading, both traditional and online, there are other special considerations for online trading, including knowing that you might not be able to instantly execute or cancel orders- both may be delayed by as much as a few hours. You also need to know if quotes and other information given is delayed or given in real time. (This will usually be clearly denoted on the stock site.) What are the limits to your trades- do you have a daily cap while working online? And because you are dealing with an entity that sometimes has technical issues, you must ask about website crashes and what that can mean to your ability to make or cancel orders.

Finally, before making your first trade with an online company, check out their privacy policy, find out about commission and transaction fees and review the customer service and complaint policy.

Article Written By J. Foley

Friday, June 05, 2009

Price Trading: Gambits, Tactics and Good Business Sense

Price trading can be tricky at best, even for the most astute financial mind. Watching the tracking trends of certain stock and thinking you have it predicted down to the last few percentage points of accuracy, only to have it fall completely off the charts, is not only heart breaking, it can also lead to financial ruin. Although trend trading can provide an educational leg-up on the competition, it does not always stop the trader from being faced with financial doom when a market takes an unexpected and therefore unpredictable header toward the basement.

The economy is in a major downward spiral, and most indicators are showing that, however some price trading charts are showing some stocks are in fairly stable shape. How this can be should be a puzzle to all but the most novice among us. The stock futures are showing down trends, and the realistic and responsible trader will adjust trading activity to reflect this.

Price trading charts are often confusing and more, they contradict themselves. Using financial software for analysis of these charts can help, but even that may prove to be ineffective when there is just too much data for the computer to sort through. Price trading can be lucrative, if you know what you are doing, and can make sense of what the market is doing.

With price trading, the main consideration is timing. You must make your move, no matter what financial instrument you are dealing with, at the optimum time to gain the best price. Knowing that there will be a huge demand on one stock in one week's time and holding onto that stock to sell during the rush makes sense, but selling it one week before the demand hits does not. As with any financial activity, especially with the current economic situation, you must know your limits and your financial caps. Do not exceed your own budgetary limits and put yourself at the risk for financial ruin. Do not make trades that you do not fully understand. Do your homework and the necessary legwork before beginning any trading activities. Work with a broker before heading out to take on the financial world on your own. Take educational seminars and read all of the financial information that is available to you, either in hard copy or online.

Do not allow yourself to get caught up in the thrilling rush of one or two successful trades. A little financial knowledge can be a bad thing, especially if it leads to risky, undisciplined behaviors on your part.

Article Written By J. Foley