Beginners Guide to Trading Online
Richard Montana | October 21, 2022
What is trading online?
When you are trading online, you are buying and selling instruments from various asset classes including Forex, Commodities, Cryptocurrency, Stocks, Indices, Options, ETFs, CFDs and Futures. You can analyse various markets using technical analysis (charting tools) and fundamental analysis (economic news calendar) and speculate on the direction the price of the selected instrument will move. If it moves in your favour, you can make profit whereas if it moves against you, you will make a loss.
What is an online broker?
When you trade online, you need an online broker who will process your buy and sell positions through to the markets. These brokers offer user-friendly trading platforms and charge a small fee for using their brokerage services. In addition to market access, they can also offer other services such as market analysis, social trading platforms, educational resources and managed accounts. Online brokers have made trading the markets easily accessible to anyone with an internet connection. Aspiring traders from all over the world can sign-up with a broker, download a trading platform and trade online within minutes.
What is a trading platform?
A trading platform is used to analyse charts of various trading instruments and to place/manage trade positions. They will include a vast array of trading tools for conducting in-depth chart analysis across multiple timeframes and on different chart types. These tools include technical indicators, drawing objects and economic calendars. Trading platforms are available for desktop, web and mobile devices.
Best trading platforms for beginners
It is important that a beginner trader has a trading platform they feel comfortable using, ideally one that has a quick learning curve and range of tutorials to help new users familiarise themselves with it. One of the most popular platforms for beginners is MetaTrader. The MetaTrader platform is used by millions of traders of all experience levels from around the world. It is well known for being user friendly and including a wide selection of trading tools to assist traders with all different trading strategies. It has a fully customisable intuitive interface and is simple enough for beginners whilst having enough advanced functionality to satisfy the more seasoned investor.
MetaTrader is available as a desktop platform and mobile trading application for iOS and Android devices. It can also run directly in web browsers without needing to download or install any additional software. You will find that there are lots of MetaTrader brokers and most will provide a free demo account so you can practice trading on the platform until you build enough confidence to switch to a real account. If you don’t have the time or skills to trade and want to copy trading signals, you should look for a social trading platform.
What makes a good broker for beginners?
There are various factors to consider when looking for an online broker if you are a beginner to online trading. Some of the most important things will be that they keep things simple and offer guidance as you start your trading journey. They should be available to offer excellent support around the clock but also know when to take a step back if you are happy to get stuck in and learn to trade yourself. Ideally, they will provide one of the best trading platforms for beginners, MetaTrader. The broker should be regulated by a top tier regulator, have discounted brokerage fees and offer a range of asset classes. Educational materials such as trading guides, tutorial videos and webinars can be useful to help beginner traders increase their trading skills and knowledge. There should be trading accounts for beginners which allow them to start trading online with a suitable investment size and good trading conditions.
What to look for in the best brokers for beginners:
- Offer the best trading platforms for beginners
- Round the clock support
- Selection of educational resources
- Daily market analysis
- Different asset classes for trading online
- Additional trading tools
- Discounted broker fees
- Regulation from a top tier regulator
- Beginner account types
- Convenient account funding options
How much money do you need to trade online?
Most online brokers will require a minimum deposit to open a trading account with them and start trading online. This can vary from broker to broker but we believe the best brokers for beginners will have a suitable minimum deposit, which is usually between $100 – $500. Of course, you should only ever trade with what you feel comfortable with and never risk more than you can afford to lose. Nearly all brokers will offer free demo trading accounts which allow you to practice trading online with virtual funds. This can be a good way for beginner traders to try out the different trading platforms and test different trading strategies.
How do I start trading online?
If you would like to start trading online, you will need to first choose a trading broker that meets your needs and open a real or demo trading account with them. If you are new to online trading then you may wish to consider one of our best brokers for beginners. Once you have opened a trading account with your broker of choice, you can then download their trading platforms and start trading online when you feel ready to do so.
Online trading is an exciting endeavour, and it is possible to achieve consistent profitability by ensuring you know how to trade efficiently and have mastered the trading basics before progressing to more advanced trading techniques and strategies. Take time to browse through the guides that will set you up for potentially more successful online trading.
Every trader should try to master either technical or fundamental analysis, and should have at least a basic knowledge of both. In addition, the successful trader will need detailed knowledge of the platform they trade on and the different order types that can be used. It is also very helpful to understand something of trading psychology, and having a solid grasp on trade management and risk management is crucial for the long-term survival of a trader.
In many cases simply following markets, reading news reports and articles about the assets and companies you’re interested in trading. You can even practice what you have learned from a broker with a free demo account to build your confidence without taking any financial risk. This can be a good way to master your strategies and build a solid foundation to help you achieve your trading goals.
Hopefully by now you will have a better understanding of trading online and what to look for when choosing a broker that meets your needs. Take your time to research brokers and do your own due diligence, the above information is only for educational purposes and not advice. Please feel free to view our best brokers for beginners if you need some further inspiration.
Forex Brokers with Neteller
Forex brokers offer a wide variety of account funding options to make their services more…
Forex Brokers with Skrill
Skrill is popular with forex traders around the world, as you can quickly move money…
Forex Brokers with PayPal
If you are looking for a PayPal forex broker it is probably because of the…
Brokers for News Trading
Trading on news releases can vastly improve trading strategies. News trading is beneficial to traders…
Forex Brokers in Europe
Trading forex is popular among traders in Europe, which is one of the most active…
Brokers for Trading the Dow Jones
The Dow Jones Industrial Average (DIJA) represents the companies that are based only in the…