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What To Know if You're an Active Trader


Investing is usually something a person does for a while and then eventually stops when they make enough of a profit. However, not everyone stops after seeing one or two large financial gains from their investment. There are plenty of active traders in the stock market and they're the reason why it's so prominent. If you're looking to take your investment journey to new heights, which can help break the cycle of generational poverty you may have grown up with, then there are a few things you need to know first.

Decide Whether You'll Be Using the Stock Market or Day Trading
Everyone knows what the stock market is these days. It's where people have the choice of purchasing shares from a multitude of companies and then selling them to the highest paying bidder. However, there's actually another form of the stock market you can do called day trading. Day trading functions similarly to the stock market as you purchase and resell stocks. But there are a few factors that sets day trading apart from the traditional market. For starters, you only have a 24-hour period to resell the stocks you purchase. You can, however, hold onto the stocks you buy for longer than the intended resale period, but you'll potentially be subject to high volatility risk.

Secondly, what you'll be purchasing are known as penny stocks, which are stocks that cost $5 or less. They don't actually cost a penny. At first glance, this seems like a far better option than paying hundreds or thousands for just one stock. But day trading is, unfortunately, notorious for its insane amount of risk. It's highly recommended that only experienced traders dabble into this particular investment. For those who are new to day trading, it's critical you research and study everything before anything else.

Install a Trading App
Active traders aren't always sitting on the computer and watching the stock market rates go up and down. They also have lives to lead as well and do have other important tasks to take care of. That said, whether you're using the market or day trading, you don't have to worry about it suddenly disappearing overnight. Even when you're doing something else or on the go, you can routinely check the state of the market through various trading apps. Trading apps provide you with the same level of accuracy of the current rates. Since technology has become so innovative over time, they also allow you to trade while you're out and about. That said, trading apps aren't all alike. Some focus on trading stocks and options, and others on forex strategies.

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Invest in the Appropriate Software
Every good trader always has everything they need, and in this era, that includes the right types of software. Investing, as a whole, has become so much more over the years rather than be some game rich people used to play back then. These days, anyone can become a successful investor or trader with enough experience and the right tools behind them. Most of the software you need as an active trader can be bought online via a subscription. 

The price of each software, like charting and back testing, varies, but you can expect to pay about $15 to around $45 per month. Make sure to research where you're buying from and compare each quote to get the best deals possible. You might not be able to afford all this at once. If this is the case, one option is to take out a personal loan. A personal loan can be used buy anything you need, but how much you get is dependent on your credit score and the lender you go to.

What is a Heavy Market?
As you go about your business and trading stocks, you might have come across some rather high prices. You might think nothing of it at first because there are stocks that are generally more expensive than others. But the thing is that almost every stock you've come across to be significantly higher than they should be. Alternatively, the stocks are trying to increase in price. So, why is this the case? The answer is simple; the market is heavy at the moment. 

A heavy market is slang used by investors and it means that there's currently a lot of resistance. The heavier a market is, the more risk and uncertainty it can cause. As a result, this uncertainty starts to cause a rather dramatic decline in price. This can cause stock traders to stay away from the market and not purchase anything because it's a sign the market is about to crash. When the stock market crashes, investors can lose a lot of money and what they currently own loses value. If you see a crash coming, it's best to back out before you lose anything.




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