What is online trading?
Technically, online trading allows you to buy or sell financial assets. In other words, online trading consists of placing orders to buy or sell financial instruments to make gains as quickly as possible.
To start trading on the Internet, you must:
- Open a trading account on a platform dedicated to this activity
- Deposit money
- Place orders
Before you start operating in the financial markets, through online trading, most brokers offer a demo account for you “hands on” without taking any risks.
Choose the right trading platform
Better to choose one of the best online brokers. Indeed, it is this platform which will be, in fact, your financial intermediary between you and the financial markets. It is therefore necessary to opt for a serious platform that offers good solutions for beginners, with the best conditions to start cautiously.
Financial markets are very volatile. It is therefore necessary to take the time necessary for a good learning. In addition to Tutorials and other training, you will first have to simulate orders on a demo account before jumping into the deep end. This first step will allow you to determine your trading profile and the markets you like the most.
Online trading strategies
There are several strategies for investing your money in the stock market:
In Swing Trading, the trader opens positions with a longer maturity (more than 24 hours and a week, in general). The disadvantage of this type of trading is often the swap fees which are charged by brokers day after day and which can impact the result at the end.
Online social trading
This is to use an interface that allows professional or amateur traders to share their strategies. Better to choose a trading platform that allows neophytes to choose a broker that offers social trading
Online Day Trading
Day Trading is a strategy based on daily openings of positions that do not exceed 24 hours. In its most “sporty” version, there is scalping, which is based on positions with high leverage, for a few minutes maximum.
Day Trading is indicated for investors who favor the maximum number of opportunities, while optimizing their success rate between winning and losing trades. It is considered that traders become profitable from the moment they exceed a success rate of more than 50%.
Day trading allows you to:
- Quickly diversify your portfolio
- Quickly increase your gains (or losses)
Copy trading can benefit investors delegating. Here the broker connects professional traders with novice investors who literally copy the former. Here, we basically replicate orders placed by the professional or ultra-competent trader. It’s a good way to develop your capital at little cost!
The pros and cons of online trading
The advantages of online trading
- It is possible to trade online 24 hours a day
- Opportunity to quickly grow initial capital
- A wide range of financial instruments
- Affordable brokerage fees
The disadvantages of online trading
- Very high risk exposure
- Need to train in technical analysis to optimize trades
- Very time-consuming activity; especially if leverage is used
Choose AvaTrade to get started in online trading
AvaTrade is one of the most influential online brokers on the French market. It meets both safety and regulatory standards. In addition, the platform offers a complete product offering to effectively diversify its portfolio. AvaTrade offers ultra-responsive customer service with competitive pricing and very well-designed online training courses for beginners.
Created in 2006 under the name AvaFX, the platform specializes in trading on:
- Raw materials
The platform is available in Europe, Shanghai, Milan, Sydney, Tokyo, South Africa and Nigeria. It offers novice traders the possibility of using powerful platforms such as: MetaTrader 4, MetaTrader 5, AvaOptions or AvaTradeGo. So what are we waiting for to start our first trades?
Invest what you can lose
Online trading is a risky and volatile investment. Trading means you can lose or win. If you use leverage, you can gain a lot quickly but also lose a lot, very quickly. Overall, before investing, you should only bet on the money you can lose.
Article written by Bertrand Dubourg – www.linkedin.com/in/bertrand-dubourg-934b691b6