Tech Goodie

If you have some money to invest and willing to take up some risks, you can get yourself involved in Share Trading.

You can join a Share Trading Brokerage firm in your locality and get daily recommendations on stocks to buy or sell, to begin with.

If you invest huge money before learning the real time trading techniques thoroughly, you might quickly lose your money.

Whether you are planning for a day trade or a long-term investment, do your best analysis on the stock’s historical trend and the probability of movement in your predicted direction.

How does it work?

Theoretically, this is similar to any other Buy and Sell business. But practically, it is not. The stock prices change very quickly. If you do not train your mind to act quickly or stand with your trading plan, you could quickly lose money in most of your trades.

You can either buy a stock and sell it when price goes up or sell a stock first and then buy it when the price comes down.

What are the different trading styles?

1.Day Trading

Trading has to be completed and all the positions must be closed within the single day of trading.

This is a risky game for beginners. Hence, it is wise to start with a small margin.

Set a proper “Stop Loss” to minimize risk and prevent drastic losses.

High Technical Analysis using Trend Charts and Graphs is essential.

2.Position Trading

With this type of trading, the positions can be kept for a long time, even for months or years.

This type of trading is suitable for those who have enough money to invest, as positional trades require buying in lots and the number of shares per lot depends on the stock.

Market fluctuations do not affect a positional trader to a great extent.

3. Swing Trading

With this trading methodology, the positions can be kept hold for a day or a week or a few weeks.

This kind of trading is usually done by home-based traders and day traders, usually for fluctuating and volatile shares.

4.Scalp Trading

This trading strategy is used to make multiple quick profits from small price changes in the shares.

The scalp traders perform large number of trades in a day, aiming at a small price change in each trade, resulting in huge profit as a whole.

What are the different types of Trading Orders?

1.Stop Order

Stop Orders help traders set a fixed price where the stock has to be bought or sold, meaning, the order is kept on hold until the price is reached.

2.Market Order

This type of order insists the broker to sell or buy a stock ASAP, at the best price that prevails at a particular point of time.

3.Limit Order

The broker is given the minimum price after which a stock can be bought or sold

4.Stop Loss Order

Using Stop Loss Order, the trader sets the price for which the broker has to wait before closing the order in loss.

Most traders make huge losses mainly because they do not place a Stop Loss Order and wait for the price to move in their predicted direction, until they are fully burned.

5.Conditional Order

The trader specifies a condition or criteria based on which a stock has to be sold or bought.

Note:

Share Trading is highly risky. It is wise to invest only the money that you are willing to lose, in the worst case scenario.