Noob Trading From Home Questions

Submitted by Sharemarket News on 10 May, 2011 - 13:07

Learn about trading from home.

Everybody has to start somewhere in the uphill climb to be share trading pros. Do not jump ship and abandon your 9-5 job just yet. Get your feet wet by trading on the side, and when you are earning more than you are losing, maybe, just maybe you can trade from home full time.

The trading information available on the web can overwhelm the newbie, so where do you start? Read on for beginner tips in cracking the market.

What Computer System Should I Use?

This should be the least of your newbie problems, actually. The fanciest equipment will not help you keep your capital (and may aid you in losing it). If you cannot successfully trade on a basic computer setup, then the odds are stacked against you making it in the market.

If you have the money to spend on fancy machines, then it's a personal choice. First you need goals. Are you day trading or are you scalping? Are you investing for the short, medium or long term? Some traders get by on a desktop with two monitors for trading, with a laptop for research, emails, etc. Others found that one screen was enough when position trading. A primary DSL connection and a backup are no-brainers.

The most important equipment is trading capital, according to the experts. Be prepared to cry while your money goes down the drain, but get back up there and do it again until you learn.

What are Good Trading Software?

Again, this one is a personal choice. Free and paid software is available on the web, but make sure you make a pro and con list before buying. Check to make sure that the site is trustworthy. You can try Linux (open source) and Microsoft stock software.

Should I Take a Share Trading Course?

People learn differently. Some prefer sit in class and hear lectures or do it over the internet via a trading course. Others slog it out on their own. Reading trading books, absorbing information from the internet and networking with other traders should help you get started.

What is a Trading Plan? What is Risk and Money Management?

A trading plan is your trading life and goals in black and white. Begin by asking yourself the tough questions. Why are you trading in the first place? Because it sounds cool and everybody's doing it? Just to make money? How much money is that? Are you going to trade for the rest of your life? How much money are you willing to lose? Is your mind set up to handle disappointment?

Risk management is the figuring out the risks in an investment and handling those risks in line with your objectives. It is the act of quantifying mistakes and potential losses. In short, finding out why you got kicked even with (what you thought) a flawless strategy.

Money management is preserving your capital. Some traders set a value at 1-1.5 percent.

But then a trading plan is no guarantee of smooth seas all around. Remember that a trading plan is only worth the paper on which it is written if it works.

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