Today trading and investment activities gain ever-growing popularity. Stock trading looks attractive due to the opportunity to get an extra income. The number of brokerage accounts increases almost geometrically. We’ll speak about what should be done to trade on the stock exchange with profit and what subtle aspects a trader has to consider. In this blog, you will know about beginner trader’s steps.
If you have your startup capital and strong determination to increase it by trading on the stock exchange, you can continue with the following Beginner trader’s steps.
The first step. Training
As any other activity, trading requires a theoretical training as minimum. If you are sure that shares are the spreads of information on social networks rather than the profitable assets, it is too early for you to get engaged in trading. To begin with, you should understand the basic principles of the financial market and its operational mechanism. You can achieve the goal in several ways. It is a good practice for you to read subject-matter books, view training videos and become a subscriber to blogs or YouTube-channels of successful traders, where they speak about the secrets of trading. It will be even better if you decide to take a professional training course. Today, there are a lot of offerings from various providers of educational services. There are training centers providing training courses for professional and beginner levels. If you have got involved in trading just recently, you should consider educational programs with basic knowledge and general information. They will give a comprehensive idea about trading on the stock. Later, when you develop an efficient trading strategy, you can join any targeted training intended for deep studying of particular tools, development of a particular strategy or other narrow subjects. Choosing an educational center, you should find confirmation that they have an appropriate license, provide the proper terms and have mostly positive reviews on the Internet. The additional advantage is a focus on practical hours and available feedback from curators. In such courses the students usually build their own investment portfolio or develop their first strategy, testing it on a trading platform. The feedback allows students to see their mistakes and understand their operation accuracy.
The second step. Strategy development
The trading strategy is a set of principles, rules, and actions, which a trader applies while trading. An efficient trading strategy is needed to succeed in trading. Random opening of the positions on the stock exchange may result in losses. Strategy development starts with development of an investment profile. You should consider the base characteristics of your investment profile including risk tolerance, supposed investment terms and profitability. Also, a trading strategy must be aimed at achieving a particular financial goal. All the above characteristics determine a trading strategy. The strategies are classified by several indicators:
- Investment horizon. It is referred as investment terms. According to this indicator the strategies are classified as short-term ones (up to half a year), mid-term ones (from half a year to a year and a half) and long-term ones (several years).
- Risk level. It shows to what extent a trader or investor is ready for losses. According to this indicator the strategies can be classified as conservative ones (with a low risk level), moderate ones (with a middle risk level) and aggressive ones (with a high risk level). As a rule, a risk level is directly related to a potential profitability of a strategy. The higher a risk level, the more a trader can gain. But in case of failure, with high probability an investor will incur heavy losses.
In accordance with a defined strategy suiting an investor to the utmost, the tools are chosen which are also classified by a risk level and profitability. If it is difficult to decide on a strategy with no outside help, it is recommended to seek assistance from professionals. Today, a lot of specialists provide investment consultations aimed at an optimal choice of strategy for the client among other things. Get quantamental investing strategies and tools.
The third step. Looking for an intermediary
You just cannot trade without an intermediary. Usually brokers arrange such linking between a trader and stock exchange. They provide access to trading platforms allowing a user to make deals on the market. Also recently the investment marketplaces have gained popularity (Dutch Rate, Sheer Markets and others). The marketplace is an online platform for trading, which allows the users to trade with various assets in one place. Looking for an intermediary is a very important stage and a trader should focus on this task carefully. It is recommended to choose a broker considering the following options: trading terms, commission rates, a minimal deposit, availability of a demo account, leverage and others. Also, the reliability of a broker should be proved. Before you open a brokerage account, you should learn more about this broker. He must have a Regulatory License and a good reputation in an online environment. This simple investigation will help you not to deal with a fraud which is still possible in the market of brokerage services today.
The fourth step. Opening of a demo account
After choosing a broker, you should not be quick in opening a real account. First, you are recommended to try trading on a demo account. The demo account is a training simulator for trading on the stock exchange. Using it, you can practice in trading, learn available functions of a trading platform, exchange-traded tools and test a developed trading strategy. As a rule, trading with use of this simulator is performed under conditions close to reality. The trader can apply various instruments for technical analysis, study the graphs of price dynamics, open and close the positions. The only difference between a demo account and real trading on the stock exchange is the zero risk of losing a deposit. All deals are made with virtual funds. Various brokers offer various limits of a training deposit, but as a rule it should not exceed USD 100 000. It means that you will not be able to test a trading strategy with a larger deposit. But the specialists do not recommend to begin trading with large deposits including trading on a demo account. Also, it is not allowed to test a long-term strategy on a demo account because you cannot open a demo account for a longer period than a month. As a rule, opening an account for practice is free of charge. But as far as a broker gets no benefits providing a potential customer with a free access to an account, there are some cons of a demo account. For instance, the features of a trading platform and a range of tools can be limited. Also, prices can be displayed with a delay.
The fifth step. Opening of a real account and starting trading
When a trading strategy is tested on a demo account, you can continue with opening a real account and start trading with your real deposited funds. You should remember that real trading differs from a demonstrative version. First of all, here you will trade with your real funds. Using a demo account, you cannot gain but also you cannot lose a penny. That is why a lot of traders, starting with real trading, feel fear. The fear, as any other emotions, can become a great obstacle for a successful trading. When a person is stressed, he can act impulsively, open positions randomly or even refuse from trading being afraid of losses. It is vital to remember that trading always comes with risk of a greater or lesser degree. And if a trader is not ready even for a minimal risk and any losses are the strongest stress for him, he’d better pause to think whether he can afford being engaged in trading. At that, not only fear can impact trading adversely, but positive emotions are also not good. Emotional uplift caused by a profitable trade and self-confidence also can prevent a trader from clear thinking when evaluating the situation on the market. That is why the main thing that a trader must do starting trading is to refuse any emotions and continue thinking and acting rationally.
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Dutch Rate Review
This is a marketplace where you can buy various financial instruments as well as create your investment portfolio. One can use desktop devices or mobile ones to place trades or analyze markets. They offer plenty of services including top-notch platforms where you can not only open positions but also forecast prices.
The main page of the website offers a brief resume of what you can get inside. Here is a comfortable menu with all features that are offered there. The main menu is located on the left side of the page. Here you can find:
It is to mention that the website has a very simple user interface. All pages are informative enough to provide you with all the necessary details about the features they contain.
This section provides you with information about all financial assets that you can purchase there. It starts with currencies that are the most popular instruments among traders nowadays. The international currency market works around the clock five days a week allowing you to buy and sell various currencies including EUR, USD, JPY, GBP, AUD, NZD, and others.
In the next section, there are stocks. It allows you to learn more about shares and the fund market in general. By buying stocks you will get not only dividends but also a share in the company. This is why those financial instruments are very popular among investors. And that’s not all. You can also trade them to get the difference between their initial price when you buy them and the price they are quoted when you sell them.
Commodities are commonly used by traders and investors as a source of diversification. Precious metals can be found in various portfolios. Oil is a good way to diversify trading portfolios additionally to currencies and stocks. Unlike currencies, this type of asset is not traded around the clock.
Cryptocurrencies are relatively new assets that are still getting popular among traders and investors. Dutch Rate has added them to provide you with the opportunity to trade the most volatile but the most promising instruments at the same time. There are plenty of coins inside including the most popular Bitcoin and Ethereum.
Indices give general information about markets. By following them, you can understand whether a particular stock market is feeling well or not. Apart from this feature, indices are also a good opportunity to earn money as you can buy them and sell to profit from the price difference.
And last but not least are ETFs. Those funds are managed by famous companies that create their own diversified asset portfolios. ETFs are widely popular among traders and investors as they do not require any skills in portfolio creation.
One of the best ways to make the most out of a stock is to buy it during the Initial Public Offer. There are plenty of examples of success when people made the right choice and became rich by purchasing stocks on IPOs. While this is a bit risky and expensive (the entrance amount should be above $1 million to participate), Dutch Rate makes it easier to start.
To help you with the analysis of IPOs, the website provides customers with the calendar of upcoming IPOs, forecasts, reviews of the IPOs that are finished already, etc.
Apart from this, Dutch Rate experts are ready to provide the marketplace’s customers with ready-made portfolios with forecasted yield. This means you will never be alone in this hard investment trip.
Whatever trading or investing strategy you exercise, daily analysis from Dutch Rate experts is at your service. Here you will learn the most recent news and events that may have a significant impact on prices. All reviews are spread among categories including currencies, stocks, indices, etc. There are also cryptocurrency reviews that will help you to understand what is currently happening in this industry and why.
Apart from daily reviews, you will find a detailed macroeconomic calendar inside provided by Metaquotes. This is a very useful tool for all traders and investors as it allows you to find out what data will have a significant impact on prices in the future.
Even if you use technical analysis strategies, the macroeconomic calendar will be a useful tool to you as it allows you to understand where a burst of volatility may occur. The data here is divided into three parts – previous, forecast, and current. You can compare macroeconomic figures to take short, mid-, and long-term decisions.
Trading nowadays is impossible without a trading platform. Modern terminals are designed to place trades and to conduct market analysis. The famous Metatrader 5 that you can find there is believed to be the most efficient and rich on tools platform.
With Dutch Rate you can use various types of orders. If you want to buy an asset by market, you can choose an appropriate order type. And that’ not all. You can also place limited orders allowing you to wait until a more favorable price to buy or sell.
Dutch Rate Metatrader 5 includes the most popular technical indicator and graphic tools to draw trend lines, price channels, support and resistance level, and even Fibonacci retracements. When dealing with this trading terminal one can add third-party indicators, scripts, and even robots written on MQL programming language.
Apart from Metatrader 5, you can use the special software Heartbeat. This is a social trading app allowing you to copy signals coming from successful traders.
Along with top-notch services, the Dutch Rate website contains all necessary documents that make this online marketplace one of the leading in the industry. You will be able to read the client’s agreement to understand the level of cooperation and the rights of both sides. Apart from this, Dutch Rate follows the rules of Anti Money Laundering policies.
There are also some other important documents including withdrawals of funds, privacy, and others. Dutch Rate is widely represented in social media including Facebook and Twitter.
This online investment marketplace allows you to buy and sell various assets as well as to create a portfolio. They provide customers with high-quality analytics and all important tools to improve the trading experience. You can participate in IPOs and other interesting and profitable events.
This online social trading service is designed for all those who want to start earning on financial markets or improve their trading results. Heartbeat offers first-class services with a simple user interface. Here are the most important points of this online social trading system.
This online service has simple yet very effective features allowing you to start earning on financial markets by purchasing various types of assets. By using the HeartBeat platform, you can easily access all experienced traders that provide their services to others.
To pick the most successful ones, you can use the data that is presented on cards. This is the simplest way to start subscribe to signals. The only thing you need to think about is how profitable and unprofitable a trader was. The higher the percentage is, the more your chances are to succeed.
You can also look at the number of copies. This figure shows how many subscribers follow a particular managing trader. The data is shown on a special chart where you can see how successful the managing trader was across several months.
HeartBeat is not only for beginners or those who want to diversify their portfolios with new and interesting trading ideas. This is a good opportunity for skilled traders to earn even more. By providing services, you can get a commission from each subscription. The more successful your ideas are, the more followers you will have. Thus, your monthly earnings will increase as additionally to your profits, you will get fees.
Main HeartBeat features
What makes Heart Beat so special? Unlike other services of a kind, there is a gamification feature. You will be rewarded for all your successful trading ideas. Those achievements are given to traders and not to strategies.
A user can have up to three awards simultaneously. There are the following achievement types:
You can get a star for every 100 subscriptions. The crown is offered to those traders who have traded successfully for a month. The cup is given for the maximum ROI during a month. Those achievements are transferred from one trader to another meaning only one can have this award at some point.
If you are not sure about the legal side, you can read all documents that you can find on their website. Here you can learn about:
- Risk disclaimer.
- Client agreement.
How to start copying trades?
You need to create your account with Heart Beat first. To start copying trades, it is recommended to conduct a basic analysis using the available data about managing traders. As it was mentioned above, this data is very simple allowing you to save time and effort. Once you have made a decision, you need to click the “Copy” on a card button to start.
Heart Beat is not another social trading service. This online application has some major differences as compared to its rivals. You don’t need to analyze tons of data to find out who’s offer is the best. You are provided with clear and understandable data instead. Heart Beat underlines the best traders by offering them various awards. This simplifies the way you can find first-class trading ideas.