Even though you can consider all the pros and cons of trading and feel ready to earn some money, it is not always easy to start. Many people are concerned about the amount of data they have to keep in mind while trading. If you feel uncertain about trading strategies, markets, brokers, and MT4 trading features you have to pick, read the helpful guide below.
If you don’t know where to start, this guide might make your efforts more productive and visible. Learn everything step-by-step to become a successful trader.
1. Choose your trading style
New traders usually accept the non-stop activity of the market as something chaotic and messy. However, there is a certain order behind everything you see. After you learn basic styles of trading, you can understand the market processes better. This choice is crucial for your further actions:
- Day trading is usually the most popular among beginners. You close all the positions you have at the end of the day. You have to stay focused since the buy signal could be unexpected. This popular way is also the most challenging one. You have to build your winning strategy to earn money.
- Swing trading is a slow one. You can hold your position for several days or even weeks. You catch the price swings from short to medium term. It is perfect for new traders since you don’t have to monitor the market night and day, yet there might be overnight risks.
- Position trading is slower than swing trading. You can hold the position for weeks, months, and even years. To do this, you have to be fluent in trading and understand evergreen trends on the market. It does not require much time once you develop the strategy. However, usually, it has low win rates, which prevents you from earning a fortune.
- Algorithmic trading requires following the number of rules dictated by the computer. You don’t check the strategy beforehand but leave it to the computer. You can use numerous strategies at the same time, programming your smart AI. There is more profit but higher risks as well.
2. Decide on securities
You need to choose which securities you will trade. Though the vast majority prefer stocks, you should know all your options. They are:
- Stocks or ETFs;
Based on your preferences, you can either choose one of the options or go with all of them. Stocks will suit you if you are interested in common brands, trading, and know them well enough. Futures are great for traders who prefer commodities and are well-aware of geopolitics and world economics.
3. Choose a broker
You have to understand which broker would be beneficial for you. Don’t open a trading account without checking the reviews first. Find out the features you need the most and decide on the minimums you can spend.
Go For It
Now, when you have learned the basics, you are ready to start. You can already pick the broker, open an account, and decide on which securities you need the most. Don’t worry, after some time, you will pick the winning strategy that matches your personal demands.