Learning how to trade stocks can be an uphill battle, but with the right know-how you’ll feel confident that you have a better chance of making money than losing it. Here are the five best ways to get up to speed on stock trading so you can experience success from the start.
#1: Read Up!
Leaders are always readers, and if you want to be a leader in the stock trading arena you’ll need to develop a love of reading all about them. Start with some classics to build a strong concept of how to trade, and then fine tune things with information found online that is current and lines up with the way you want to trade.
For example, you could get a primer on penny stocks with this Penny Stocks 101 Guide and then see where your intellectual curiosity takes you from there. In just a few weeks of immersing yourself in relevant books you’ll have a pretty good handle on how things work and be ready to make your first trade.
#2: Take Online Trading Courses
Online training courses can be a great way to learn how to trade and will teach you practical, hands-on style lessons that mimic what it’s actually like to trade stocks each day. Of course not all of these courses are created equally, so you’ll want to make sure that you’re learning from the best and not from someone who only teaches how to trade.
Preferably you’ll want to learn from a successful trader that is actively trading so that you can get the most sound advice to follow. Do your homework and make sure the course is run by an investing pro, not someone that failed at trading and turned to teaching as a backup plan.
#3: Stay Informed
Once you’ve established a foundation of knowledge from all the reading you’ve done, you’ll want to stay up to date on the latest information that comes in. This is different from reading about philosophies and different strategies. You’ll need to know the nitty-gritty about the companies you’re considering and what actions they’re presently taking.
#4: Take Notes On The Best
Some of the best and brightest stock traders are still active and currently trading in the market. Keep up with their latest moves so that you can try to understand why they make their decisions. You don’t have to follow their lead blindly, but seeing the kinds of moves they’re making can give you insight into how they think and how successful trading happens.
#5: Paper Trade to Build Confidence
Before you make your first actual trade you’ll want to practice by paper trading. In days of yore you’d have to keep a personal record of the stocks you pretend bought, track them over time and then record your would-be wins and losses by hand. These days, paper trading is done online and looks just like actual trading except there’s no real money involved.
Paper trading is nice because you can know objectively how good or bad you’ve done just by glancing at your practice portfolio. It takes the edge off knowing that your losses aren’t real, but also limits the joy when you see that you’ve made money with your trades but not the kind you can spend.