“Let’s start at the very beginning, a very good place to start.” – Rodgers & Hammerstein
Every one of us has to start at the beginning whenever we need to master a new skill. It is not a weakness. It is a fact of life. The same goes for learning how to invest in the global financial markets? Everyone has to start somewhere and, I believe, it’s a good idea to learn from other people’s mistakes. In this way, we bend the learning curve more in our own interest.
Definitions: Investing and Global Financial Markets
It is important to have a clear understanding of the terminology for the topic that we are discussing. For example, how can we discuss investing in the global financial markets when we don’t even know what these terms mean?
According to Investopedia, "Investing is the act of committing money or capital to an endeavour… with the expectation of obtaining an additional income or profit. Investing also can include the amount of time you put into the study of a prospective company, especially since time is money.”
A financial market, on the other hand, is ‘’a market in which people trade financial securities, commodities, and other fungible items of value at low transaction costs and at prices that reflect supply and demand. Securities include stocks and bonds, and commodities include precious metals or agricultural products’’. The term "market" is sometimes used for what are more strictly exchanges, organizations that facilitate the trade in financial securities, e.g., a stock exchange or commodity exchange. Thus, global financial markets refer to all of the financial markets, or stock exchanges situated around the world.
Please note, “trading” and “investing” are synonymous in this context.
Online trading instruments and brokers
There are many different ways to trade/invest in the global financial markets. Some of the more popular ways include: Forex trading, options trading, the buying and selling of shares, and CFDs (Contracts for Difference).
There are also a large number of online trading brokerages available for you to sign up with and each broker offers one or more of the aforementioned trading instruments. It's important to partner with a reputable firm that provides adequate online tools. Stern binary options trading is a registered binary options trading broker who offers more than just a way for you to trade online. Amongst other perks, they offer a comprehensive education centre which includes a binary options trading academy with a fully comprehensive approach to training you that is free-to-use, and analytical software which you don’t need to download and install on your computer. In a nutshell, the more comprehensive the education centre, the easier your learning curve will be, and you will move quickly up the trading ranks, eventually, ending up as an advanced investor.
Things to avoid as a beginner trader
Here are a few things to avoid or sidestep when learning the art of online trading:
- Do not make impulsive trades: Do not make impetuous trades just because you heard on social media (or another source) that a certain asset is going to make a lot of money. This is one of the quickest ways to lose substantial amounts of money, if not your entire investment. It’s vital to thoroughly research the price movements for the asset you want to trade on. If you are uncertain about something, contact the account manager allocated to you by the broker.
- Do not trade on emotions: One of the most important lessons that we all have to learn at some stage of our online trading careers, is not to make emotional, knee-jerk trades. Do not “go with your gut.” Once you have decided which trades to make, stick to them. As with the previous point, don’t make any trades without researching the underlying asset thoroughly. Don’t pay attention to hearsay unless it comes from a proper qualified source.
- Avoid get rich quick schemes: There are many get rich quick schemes available on the internet today. It would seem that the worse the global economy becomes, the more there are of these schemes – at least, that is just my impression. There is never any ‘easy money’. If something sounds too good to be true, stay away from it.
- Never assume you know everything: Learning to trade successfully is a life-long journey. There is always something new to be learned. You might have found a way to trade successfully in today’s economic climate; however, you might need to learn new trading skills for tomorrow’s economic climate.
I believe the following words are pertinent to the art and science of online share trading: “The real voyage of discovery consists not in seeking new lands, but in seeing with new eyes.” – Marcel Proust. Learning to trade and continue investing successfully on the world’s financial market means becoming wise from a lifetime learning curve with predictable and unpredictable twist and turns along the way. There is no avoiding this. So seek the guidance of experts like www.sternoptions.com.