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Learn How to Trade Step by Step

HomeBusinessLearn How to Trade Step by Step

Each year, an endless number of people try their luck in the stock market. Unfortunately, little do they know that this place is for masters of speculative capital. The majority of those who want to learn how to trade stocks but fail just don’t have what it takes to tilt the odds in their favor. The key lies in the need of acquiring some basic skills in trading.

Of course, relying solely on gurus might lead to a dead-end, so the best thing to do is self-education. Hard work and dedication can go a long way. All you need to do is follow these simple steps and it may not take long before you start reaping what you sow.

Create An Account

This step might seem quite obvious, but some people have very little or no knowledge in online stock trading. Therefore, finding a decent online stock broker and opening a brokerage account is the first thing to do. 

There are numerous brokers that offer virtual trading services. So, you might want to look up some reviews and best online brokers lists. After you open your account, take some time to become familiar with its interface. Moreover, you can try the free trading tools as well as the exclusive research offers.

Learn to read

Surprisingly, reading plays a huge role in the making of a successful stock market broker. Everything from financial articles, to books about stock market and website tutorials is welcome in your to-read list. It’s important to study everything about the market or at least research some general concepts.

Because trading doesn’t follow specific rules, it often results in unexpected turnarounds. For this reason, having some background knowledge is bound to come in handy, even if you believe you know what you’re doing. For instance, works like Stock Market Wizards by D. Schwager  and Trading for a Living by Dr. Alexander Elder are only a couple of the must-have books for every beginner in the field.

What’s more, it’s good to keep in touch with the news. The process involves following the market and reading about the overnight price action on foreign markets. You can also check on websites such as Yahoo Finance, Google Finance, and CBS MoneyWatch. You can also make a subscription to The Wall Street Journal or Bloomberg.

Start Analyzing

Analyzing is the mother of swift and savvy decision-making. That’s why studying the basics of technical analysis in all time frames is crucial—eventually, it may help you accumulate valuable experience with charts and price prediction. Theoretically, you may differentiate between either long-side trade or a short sale. In reality, price lines can be quite fluctuating in both cases, shaking out both buyers and sellers.

As financial markets grind out trends and trading ranges using fractal properties, it’s lousy to learn to deal with the three-dimensional playing field. From then on, you can carve out a long-term trend, an intermediate trend, and a short-term trading range all at the same time. Look at each security into three timeframes. You can start with 60-minute, daily and weekly charts.


Contrary to the common perception, the best way to learn the stock market game is to practice. Virtual trading offers a perfect solution as it allows the neophyte to keep in touch with real-time market moves. It eventually helps beginners to form the outline of how to trade stocks by buying and selling decisions.

Typically, the training involves the use of a stock market simulator that recreates the actual stock exchange performance. There, starters can carry out trades using various holding periods and strategies and analyze the results to perfect their skills.

Of course, there’s no general answer as to when is the right time to move on to real trading. Generally, simulated trading has one flaw that concurs after nearly every switch to considerable money trading. 

No matter how perfect your paper results look, it’s vital to learn to co-exist with your emotions of greed and fear. Since paper trading doesn’t engage these emotions, it can’t give you the experience of actual profit and loss.

Perhaps, this psychological aspect is the main reason why there are more first-year players that give up the game than bad decision-making. Therefore, recognizing this challenge is one small but an essential step to addressing the correlation between money and self-worth.

Additional Ways To Learn And Practice How To Trade Stocks

Universally, there is no better teacher than experience. Still, your education on how to trade stocks shouldn’t end there as you may make use of some additional means of gaining knowledge and skills in trading stocks. Online or in-person trading classes and specialized seminars are trendy and allow participants to meet up with professional traders.

On the other hand, they can provide valuable insight into some specific aspects and strategies of market trading. Such events come in various forms, such as workshops, where you can try different entry and exit strategies as well as other methods.

Another good idea is to pay for research and analysis for both practical and educational purposes. If you’re into mentoring, you can hire a hands-on coach to guide, advise and critique you when needed.


Last but not least, start paying attention to position and risk management. You may require to make a timely exit when you reach the holding period that favors the profit and loss target. Polishing your managing skills is an excellent way to learn how to hold three to five positions at a time, especially when all of them move in different prospects.

Acquiring a trading edge requires keeping a daily journal with all your trades. Moreover, it should include the reasons for taking each risk, as well as other information like holding periods, final profit, and loss numbers. This little habit may eventually transform you from a novice into a broker who has great expertise on how to trade stocks and regularly takes money out of the market.

How To Get Started

Having confidence in your market analysis and knowledge on how to trade stocks is essential for successful trading. For this reason, it’s important to start off with an appropriate technology. If you’re just beginning your journey in stock trading, Trading Computers is the best place to get you started. You can find a wide array of bundles of desktop computers and laptops specifically-designed to provide maximum comfort and power.

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