Do you want to get started in the stock market ? You need some basics! Indeed, getting into trading without proper knowledge can be really risky. You can lose your entire investment in no time. So, in order to make a profit in trading, you need to prepare yourself now.
In this comprehensive guide, you will discover how to get started in trading. We’ll walk you through the steps you need to take to start trading. At the same time, you’ll get a list of the best brokers for beginners and tips for success in the stock market.
Let’s start immediately with a concrete definition of trading!
What is trading ?
Trading is trading in the stock market. It is any activity of selling or buying any asset in the financial markets. In fact, the term « trading » is an English word that French speakers also use to refer to stock market trading. So if you buy or sell anything on the stock market, you are said to be trading.
What are the steps to follow to start trading ?
The steps to follow to start trading are:
- Learn about and educate yourself about trading
- Choose the best broker for beginners
- Choose a trading account that suits your profile
- Choose the assets to invest in
- Define a trading budget and make a deposit
- Open a position on the asset of your choice
Let’s look in detail at the different steps to start trading:
1. Learn about trading and get educated
The first thing you need to do to get started in the stock market is to learn as much as possible about the concept. So, to begin with, look for information about trading. Try to understand what it is, and how it works. There are books available to you that will give you more detail. Once you have a grasp of the concept, you will need to learn from a professional, or from a broker.
2. Choosing the best broker for beginners
After learning about trading, you now need to choose which broker to start trading with. Ideally, you should get the best broker for beginners in trading. This broker should be easy to use. It should also have a good training program and a free and unlimited demo. With this, you will be able to practice and learn the ropes of trading!
3. Choose a trading account that suits your profile
When you have practiced enough with the demo module, you will have to choose a real account to start trading. Generally, brokers offer accounts according to the user’s profile. In your case, you should choose a standard account or a limited risk module. For now, don’t even think about a account for professionals.
4. Choose the assets to invest in
There are several kinds of assets in the stock market. Before you get started, you need to clearly define which ones you are interested in. As a reminder, the main assets are forex, stocks, indices, and many others. You can choose from these the asset that really suits you according to your strategy. To the same extent, you can simply get started in the stock market by buying all kinds of assets.
5. Set a stock trading budget and make a deposit
After choosing the assets you want to invest in, you need to set a budget to start trading. Budgeting is important when you are a beginner. This is because it allows you to invest knowing what you can spend. That said, you need to budget a fairly large amount of money. For a beginner in trading €10,000 may be enough 🙂
6. Open a position in the asset of your choice
This final step marks the beginning of your career in the stock market. Indeed, once you have properly budgeted your trading balance, all that remains is for you to invest. To do this, you need to open a position on any asset available on the broker of your choice. You have two options. You can take a bullish position or position yourself as a bear!
Selection of the best brokers for trading beginners
| Best brokers for beginners in trading | |||
| Broker | Minimum deposit | Key benefit | More information |
| eToro |
200 $ |
✔️ 0% commission on stocks |
Visit |
| XTB |
0 € |
✔️ No commission on Stocks |
Visit |
| Admiral Markets |
From 1 € |
✔️ Excellent maximum leverage |
Visit |
| Vantage FX |
From 200 € |
✔️ Unlimited demo account |
Visit |
| AvaTrade |
1 € |
✔️ Effective trading tools |
Visit |
| IG Markets |
250 € |
✔️ Wide variety of financial instruments |
Visit |
How to get started in trading: the practical FAQ!
You now know all the steps you need to go through to make your trading debut. It is now time to teach you some tips to apply to make your debut really successful. At the same time, you will discover the main strategies that a beginner in trading must master. But before all that, find out right away about the different types of trading.
What are the different types of trading ?
The different types of trading are :
- Spot trading
- Stock market speculation.
Let’s take a deeper look at what these are.
- Spot trading : This is the main form of trading. It consists of buying assets and actually holding them. This type of investment is seen when it comes to stocks and crypto-currencies. It allows you to become a shareholder in a publicly traded company, or to hold a real digital currency!
- Stock market speculation : As the name suggests, this type of trading is like taking a position on assets without owning them. In this case, you simply invest in the rise or fall of the underlying asset listed on the stock exchange. Speculation is done on virtually all stock market assets via instruments such as CFDs, Futures and others 🙂
What strategies to master to get started in the stock market ?
The strategies to master to get started in the stock market are:
- Swing Trading
- Day trading
- Scalping
- Hedging
Here are more details on these different basic strategies.
- Swing Trading : This is the very first trading strategy. It is a long-term strategy. Swing trading is when you open positions over several months or years. This long term position taking allows you to take advantage of all the fluctuations in the market, but it can cost you a lot in terms of fees!
- Day Trading : Unlike the previous strategy, Day Trading is a short-term strategy. The concept is to open positions and close them at the end of the day. At least, the positions should not run for more than 24 hours. This strategy is less expensive in terms of fees but does not allow you to profit from fluctuations!
- Scalping : Also known as an Intraday trading strategy, scalping involves holding positions for a few minutes and then abandoning them. This strategy is only advised in high volatility markets such as crypto-currencies 🙂
- Hedging : Compared to the previous concepts, Hedging is not characterised by its periodicity. Rather, it is a hedging strategy against the risk of loss. It consists in taking two opposite positions on an asset by investing the same amount. This strategy is prohibited on most brokers
What tools for a beginner in trading ?
The tools to learn for a beginner in trading are:
- The chart and its elements
- Technical indicators
- Leverage
- Trading signals
Find out more about what they are:
- The chart and its elements : This is the main trading tool. With the chart, you can see the evolution of an asset’s price in real time. Similarly, you can see the historical movements of any market asset. To do this, you need to learn how to use the elements of the chart (curve, line, and other) to understand it
- Technical indicators : these are analytical tools put together by trading experts. Technical indicators allow you to study the movements of an asset in order to predict its future. You can therefore make an objective decision, but one that is not always justified by the results.
- Leverage : This instrument allows you to increase the financial power of your investment. To be precise, it is a loan that the broker provides you with to optimise your positions!
- Trading signals : These are investment recommendations made by experts for the beginner trader. So you can simply copy them to your trades without having to analyse the market.
NB: You can find all these tools on a broker with a trading platform 🙂
What are the tips to apply when starting out ?
The tips to apply to start trading are :
- Practice seriously with the demo : If you have an unlimited demo account, then take advantage of it. Don’t be in a hurry to start trading for real. It is better to take your time to master the broker and the different trading strategies.
- Avoid leverage as much as possible : When starting out in trading, it is best to go with your own resources. Using too much leverage at the outset can add to your losses if you make a bad investment.
- Set up a risk management strategy : Compare the chances of winning and losing on each opportunity before investing. This allows you to back out when you are unsure!
- Keep up to date : By staying informed, you can guess whether an asset’s price may fall or rise in the next few days and months.
- Always pocket some of the profits made : After a successful investment, withdraw at least 30% of your profit. Don’t invest all your profit!
- Trade with a regulated broker : Brokers that are recognised by the law are the most reliable. With them, you can be sure that you won’t be ripped off.
- Diversify your investments : Don’t put all your eggs in one basket. It is better to invest in several different types of assets.
If you apply these tips, you will get off to the best start in trading.
How to get started in the stock market : in summary
All in all, starting in the stock market is a very good decision. Investing in the stock market is very lucrative, especially for those who put all the chances on their side. The good trader must therefore prepare himself from the beginning of his career if he wants to obtain good results. That said, if you want to start trading today, just follow the steps we’ve outlined in this comprehensive guide:
- Learn and train in trading : You’ll miss out if you don’t have a minimum of skills. That’s why it’s best to know a little more about trading.
- Choosing the best broker for beginner trading : Always trade with the best broker to avoid scams, and for easy investment.-
- Choose a trading account that suits your profile : Practice with the demo, then start with the standard broker’s module to get the hang of it easily.
- Choose the assets to invest in
- Define a trading budget and make your first deposit : Starting out in the stock market requires investing. So it’s best to set a budget for what you are willing to spend.
- Open a position in the asset of your choice : At this point, you can speculate on the price or trade cash!
If you have any further questions about this, please feel free to leave a comment 🙂
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