Hey all, I get asked this a lot to do so i’ll be making a basic “introduction to trading” for those that are brand new, and i’ll keep it rather simple. Check out RULES TO TRADING for more specific information but this will be just getting you started.
Step #1: How does one REALLY get started with trading? Should you read books? Should just go gung-ho into trading? The answer is simple, learn what FUNDAMENTAL trading is, what TECHNICAL trading is, and which style suits you best. FUNDAMENTAL trading is trading on the basis of what you feel you LIKE about the company and what has a POTENTIAL to keep it going up. For example if a company gets a contract for $2 BILLION dollars, what kind of contract is it? How much of an impact on the company will it have? These kind of questions. Technical is just the opposite. STUDY patterns. Understand what different things like SMA, RSI, and Low float mean. Investopedia.com is a good source of this.
Step #2 How much SPARE time do you have? Do you think you’ll have time to trade during the day or have to hold LONG-term to profit? Aka, are you a DAY trader, SWING trader, or Long-term investor? Day trading involves trading day to day to make profit, swing trader can be a few days out, a few weeks, or a few months. LONG-term might mean you won’t have time to check other than maybe once or twice a month.
Step #3 Choosing an IDEAL broker to fit your trading style. I personally recommend TD Ameritrade for LONG-term and SWING investors, and to some degree day traders. For kind of a mix of day trading/swing trading ROBINHOOD is a great app for beginners: http://share.robinhood.com/louiss24 if you sign up via this link you get a FREE stock and I get a FREE stock so joining up just for the free money is a no brainer. If you decide to signup with TD Ameritrade signing up through me gets you a FREE 300 trades, and other bonuses depending on the time you sign up so contact me via a private message for more information on that. You can also consider OPTIONS trading which is a bit more risky and you can learn more about that here, https://start.tastyworks.com/#/login?referralCode=JKCRCZRM89 but essentially it’s investing on what you think a stock will do in the future but at a much lower cost for a much higher potential chance of return, but a higher % chance of loss, too. It’s recommended for all trading to have at least $2000 to $5000 to spare to throw into trading.
Step #4 PAPER TRADE. What’s this mean? You practice with essentially PAPER money, most brokers including TD Ameritrade will have this option and their ThinkorSwim platform is one of the best to do this with. You can try out theories on it, see how well they do and REFINE strategies. It’s important to get at least ONE working trade that you win most of the time with, then work on that one while the others you refine. With paper trading you never actually risk REAL MONEY so you can try all the different strategies to your hearts content without ever risking anything.(edited)
Step #5 Determining what you CAN spend and what you CANT spend. Trading is a high risk, especially if you go in blind. Make sure AFTER paper trading you got things down and you got them down GOOD. If you go in blind you can lose THOUSANDS of dollars so make sure you know how to PROPERLY manage your risk. Do not EVER put in more money than you can afford to lose 100%. The market is vicious, keep that in mind.
Step #6 Understanding ALL of the terminology and of course you should learn some basics while paper trading but I recommend Investopedia.com, and https://finviz.com/?a=132310680 to get a lot of core fundamental and technical terminology(that you can search for definitions on investopedia.com), and Mark Douglas. Also learn about PSYCHOLOGICAL trading and understand means to get over FEAR of trading. Most traders understand they will both MAKE and LOSE money, know when to cut off your risk and KNOW when to hold on to stocks. Learning ENTRY/EXIT points is very important.
Step #7 If you want more insight into picks I call in the “STOCK ALERTS”, “OPTION ALERTS”, and “SWING ALERTS” area on my Discord https://discord.gg/jgM6GpJ and how I pick them, why I pick them, or you want a more direct mentorship I do offer Patreon support that helps me to keep providing free picks to people in public and goes over all the strategies, scanners, and other tools I use to get my picks as accurate as they are, you can learn more about that here: https://www.patreon.com/Freelancepreneur