Stock Trading Digested
Stock trader sounds big, but before you do so you have to know the basics of stocks trading otherwise you will end up with nothing. We have heard it in the news, in movies, read it in magazines, in the newspaper stocks. Stocks have been around for decades. These investments have been one of the more secure ways to invest your money, probably second only to real estate. Sure prices could go down, but mostly only temporarily. If ever the market crashes and some stocks plummet ground low, these are just exceptions that are usually accompanied with foul play or malice.
So what do you need to know about stock trading? Firstly, just like in a lot of articles named stocks for dummies, if one wants to engage in stocks trading one has to hire a broker. Your broker will be the one who will do the actual trading and will charge a fee for doing so. It is important to know how much a trader will charge you and how far will he go to manage your stocks. Some traders only charge you a percentage from earnings you may earn but most will charge you for every transaction he will do for you whether this will entail you earnings or not. Stock trading for dummies can be a very good starter article to help you in this. Your broker is a very important factor in stocks trading because they most usually matter on whether you make money or not. All your transactions whether buying or selling stocks could earn you money but if your broker charges a high fee for each transaction then your earnings could easily be eaten up by those fees.
For example you make an initial investment of a thousand dollars. You make your first buy with AB Company buying 20 shares at $40 each and your broker for example charges $40 for each transaction. All in all this would cost you $840 leaving your account with $160 in cash and 20 stocks from AB Corporation. In a few days the stock prices go high at $47. So you instruct your broker to sell giving you sales of $940 less the $40 fee leaving you only with $900 plus your remaining cash of $160. So in these two transactions you net $60 while your broker pockets $80. So read more articles on stocks trading and when you feel you know enough look for a very good stocks broker and start building your stocks empire.