Trading in the Digital Age: A Guide to Online Trading

Trading is all about making educated guesses on market movements without knowing for sure what the outcome will be.

Trading today is carried out online, and anyone can do it with nothing but a laptop or similar device. There are hundreds of different financial markets to trade in including forex, stocks, indices, commodities, crypto, and much more. Throughout this article, we’ll tell you how to get started with trading in the digital age.

Essential Terminology

Before learning about the ins and outs of trading, it’s important to learn the lingo. By our estimations, here are the top terms you should learn:

• Trading on margin. Known as a “leveraged” trade, this is opening a position lower than total trade value.
• Going short, going long. “Going long” is known as “buying” – predicting an increase in market value. “Going short” is known as “selling” – speculating a fall in price
• CFD trading. Contracts for Difference (CFDs) award the difference between the trade opening and closing prices.
• Volatility. Is how rapidly the market moves in any direction. High volatility = high risk. However, it can pay off if you have a logical strategy in place.
• Risk. Risk is how likely you are to lose your investment – you need to be willing to risk everything.

Best Markets for Beginners

Before you start trading, you have to understand the different markets and choose a great place to start. Here are the best markets for beginners:

• Shares. Making predictions on whether public company share values will increase or decrease.
• Bonds.
• Indices. Underlying asset groups pooled together into one investment – you’re estimating the movement of all indices.
• Commodities. Natural resources have a value attached to them, and you can invest in this movement.
• Forex. Estimating changes in fiat currency values. This market moves constantly and has high risk and volatility.

Excellent Learning Resources

Before making a trade, you need to spend time learning beyond the information outlined above. Luckily, there are plenty of excellent resources for trading beginners. Additionally, you should get your head around trading software, which is where you’ll monitor the market and execute trades. The best way to do this is to download metatrader 4, which will let you practice trading strategies while disconnected from the live markets and with zero risk.

Making Your First Trade

Before making your first trade, you’ll need to convert your practice trading account into a live account. From there, you’ll need to deposit money into the account and get ready to trade. After assessing the markets fully and choosing a position to open, you’ll click “Buy” or “Sell” depending on your thoughts. Finally, you need to choose the size of your deal and finalize the position.

Make sure that you take the necessary steps to manage risk by monitoring your position closely and withdrawing at the right time.

Trading in the digital age can be exhilarating, but you need to understand the lay of the land before you make your first trade.