How to Start Trading Stocks Online

These days, more and more people are trying to escape the nine-to-five grind. Thankfully, the internet has a ton of opportunities in store for anyone who wants to break out of the corporate grind and become their own boss.

One such money-making opportunity that you can do from the comfort of your own home is trading stocks. Aside from allowing people to free themselves from their job, a blog post by The Investor’s Handbook also points out that trading stocks is a great way to save for retirement and secure a steady income.

Below, we are going to discuss how you can start investing in stocks online now.

Decide What Kind of Trading You Want to Do

The first step to trading is figuring out what kind of trader you are. Do you want to always be on high alert and trade every day? Or do you see yourself buying stocks and holding them for long periods of time? There are different approaches to stock trading ⁠— and each subsequently has their own risks and rewards. For starters, there’s day trading, which allows for quick returns but often runs on borrowed money.

There’s also stock investing, where you buy and hold stocks for the long term — which makes it possible to get significantly bigger returns. Before you decide what kind of investing you want to do, be sure to take note of your personal preferences, and carefully weigh up the risks and rewards first.

Get Your Finances in Line

You have to make sure that you’re financially ready before even starting to trade stocks online. Aside from the fact that some forms of trading require you to have a minimum deposit in your account, knowing where you stand financially allows you to plan better for the short and long-term. If you’re planning to pursue stock trading full-time, you have to make sure that your capital is big enough to provide you with sufficient returns.

In addition, it also pays well to have an emergency fund. An article on money milestones by Petal Card highlights how it’s important to build yourself a financial cushion — so that you’re ready for any unexpected emergencies. And because the stock market can be volatile and unpredictable at times, having an emergency fund means that you have additional resources to fall back on during lean times.

Do Your Research

In order to avoid costly mistakes, you should first learn everything you can about stock trading and the economic market. You can start by going through the various free resources and tutorials that you can find online. If you want a structured learning experience, you can also enroll in an online investing course where you can learn the basics of stock trading.

It also pays to keep your mind active by reading everything about trading stocks through investing books such as The Intelligent Investor by Benjamin Graham or The Simple Path to Wealth by JL Collins. Of course, the possibilities are endless.

Figure Out Which Online Broker Suits You Best

Thanks to the internet you can now trade stocks virtually anywhere you want. Nowadays, you can find a variety of online brokers that allow you to trade stocks simply by signing up to their platform.

However, choosing one can be overwhelming, especially if you’re a beginner. As a rule of thumb, look for a platform that prioritizes customer support, has account and trade minimums, and provides access to educational resources and useful tools.

Also, be sure to look for an online broker with software that’s easy to navigate and a community of peers to help you with your queries.

By following the steps we’ve listed above, you can now take the next step and make your first trade! For more how-to guides and tutorials, be sure to look at our other posts here on Royal Tutorial.