Online Stock Trader

When you begin to trade, it may be difficult to identify what is the best time frame for you to trade. The alternatives are whether to trade short term, medium term or longer term. But before we go any further, maybe we should clarify what we mean by these terms, as it may not be clear. A day trader would think of a trade that lasts more than one day as long term. An investor however would think of a trade that lasts a few days as very short term. The definition of what is short, medium and long term is set by the trader himself. It is common however, for traders to think of trades that last days as short term, weeks as medium term and months or years as long term. These definitions aren’t set in stone however, as each trader will define the way they trade and the way they define the trades for themselves.

It is essential to identify the trading time frame that suits yourself. For some types of people they would not be at ease at all day trading. They don’t want to be concerned with the markets movements from hour to hour. For other types of personalities, waiting for trades to develop over weeks or months is like watching grass grow. They are suited more to trading small movements in the markets. It is also a case of matching the trading time frame with your lifestyle and other obligations. If you have a day job it is simply impossible to watch and pay full attention to the screen all day long.

When you’ve mastered trading in your preferred time frame, you may wish to consider diversifying. It is less common to diversify across time frames as it is against markets and systems. To trade different time frames takes much discipline and organization. You need to have full belief in your systems and ability to see trades to the end. It is likely that you will have conflicting signals from the various systems. For example a short term system may indicate a buying opportunity while the medium term system is indicating a sell in the same market. It is tempting to get confused and sell in both systems. The correct thing to do is to follow the systems independently without regard for what the other system is indicating. Trading in multiple time frames is much easier said than done.

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What is your stock picking method? Is it successful? These are questions that you need to be 100% sure of if you are going to make excellent returns. People that do well have and method and they stick to it. A lot of people float from one system to another and therefore don’t get good returns.

A lot of people leave their stock picking to the ‘experts’. When I say ‘experts’ I mean the financial pages of newspapers. People read stock tips in the financial paper and make an investment decision based upon that alone. I am not criticizing this as I used to do that when I started out. Can you really make superior returns that way? I know that I didn’t.

A better way of doing it would be to use a stock trading newsletter. These often give recommendations but go further by giving more detailed research. The two advantages of this method are firstly you get to learn from the analysis that the professionals do and secondly you often get to view their track record. They often have a portfolio where you can see how their picks have performed over time.

The methods above generally make their recommendations based upon fundamental analysis as a way of stock picking. Technical analysis is something that is being used more now. With technical analysis you look for patterns in the price instead of a strong cashflow statement.

As you can imagine, with a name like ‘technical analysis’ it can be a little difficult to get your head around. I would suggest a technical analysis course before you started to implement this method. If can learn and apply it correctly though it will improve your trading performance.

There are lots of different stock picking methods that you can use and we have been over a few here. You should not that that you should only stick to one the ways we have mentioned. Why not experiment in combining a couple and seeing how you get on with that?

How are you doing with your trading? I would like to think you are perfoming as well as you would like. If you aren’t then perhaps you should try to improve the methods that you are using. You should consider doing a technical analysis course and that should give you the improvement that you want.

A technical analysis course should help you avoid some costly trading errors. The courses themselves can be quite expensive so it is important to know what you are looking for before you begin. There is a lot to learn and it is easy to miss things.

It is important that you make a commitment before starting or even buying the course. I know so many people who thought that a technical analysis course would solve all their problems. They attend courses and then the believe that their results will be brilliant. If you don’t take the action then you won’t see the results.

Think about the amount of equity that you have in your account and compare that to the course cost. If the amount that you are trading with isn’t that large then it may not be the right time for you.

You need to have the right expectations here. You will not be the world’s best trader after your first technical analysis course. Maybe you could earn 20% per year. If your capital is at such a small amount prior to starting then it may not be worth it. If you are considering this as a more long term venture then it still might be a possibility.

If your budget isn’t very high then you shouldn’t go for a classroom based technical analysis course. There are lots of books that you can read and learn from. You should be able to learn the basics from these.

You have a lot of options available to you. Please be willing to put the work in whichever one you go for. You need to take action otherwise nothing will happen with what you learn.