Olya Kobruseva

12 Tips For Becoming A Stock Tradingista

The words of wisdom are always to not let money “sit” in your bank account, but to invest it. What if you only have $4 in your bank account? Just don’t go into debt, perhaps. A couple years back there was that study that showed that 40% of Americans didn’t have enough saved for a $400 emergency. Based on this article, you might want to save $400 first. But if you have $500 in your bank account, you could invest $100, at least to practice trading. Which brings me to my first piece of trading advice:

1. Find out if you like trading. There are other ways to make money long-term, like moving up in your career, limiting unnecessary spending, investing in real estate, or doing a side hustle. Trading means your money will go up and down, hopefully more up than down, but if you don’t like this feeling, you might want to find an alternative to trading to be financially savvy.

2. Start small. Make sure you practice before you invest lots of money. Get used to making decisions of when to buy and when to sell. This would be like taking your baby on a long car drive before a plane flight.

3. You can also practice with no money. Write down when you would buy and when you would sell if you don’t have any money to work with. See how well it would have gone.

4. Buy low, sell high. The goal of trading is to predict the ever-changing values in real time. When the price is low and you feel like it is going to go higher, buy. When the price is high and you feel like it is going to go lower, sell.

5. Invest in things that you believe in. If you feel like you really believe in a product’s mission and trajectory, that means that maybe it should be something that you’re a part of.

6. More importantly, how does the public feel about a product? What’s in the news? Did a company come out with a new car that has a positive review in a popular newspaper? Did you read online that a video game’s usership has exploded? Innovation can be good or bad. History can be helpful, like a brand’s integrity or reputation.

7. How is the economy overall? How is the morale of people? Is there high unemployment? Who is president? All of these factors can affect trading. If anything bad is going on, it might be better to trade short-term, rather than hold stocks long-term.

8. Should I trade short-term or long-term? Things that you can invest in with trading often return to the same numbers. Like something could go from $2 to $4 to $2 to $1 to $2. If you can buy in at $1, and you feel very strongly about the product, you might want to hold long-term because it likely won’t go below $1. However, if you get in at $3, you might want to sell it short-term if it reaches $4, unless you believe based on the news that it might go much higher. Going from $3 to $4 sometimes can happen in one day.

9. The New York Stock Exchange (NYSE) is open Monday through Friday, 9:30 a.m. to 4 p.m. EST. Cryptocurrency exchange is open 24 hours a day. This could affect your trading lifestyle, whether you are comfortable with gaining and potentially losing money while you sleep at night.

10. Learning the software might be a challenge for some. There are a variety of websites and apps to choose from. If you struggle with computers and phones, it might take a learning curve.

11. The stock market most people feel is a safer bet long-term, while crypto has higher ebbs but also flows, and is more likely also to go to zero, meaning you can lose all your money that you’ve invested.

12. Put in a stop-loss order if you can. If you’re in at $3, you can often put in a stop-loss order at $2 so if the investment starts to go down, you can get out before you lose even more money. Likewise, if you’re in at $3, and it goes up to $4, you can put in a stop-loss order at $3.50, so you’ve made some money no matter what.