Universal Investment Strategies | I’ve looked everywhere for a great basic guideline that tells people how to trade stocks. To be more specific, I was looking for a list containing the essential steps necessary to began trading stocks.
The reason I was looking for this was that we regularly receive emails from visitors of our website that ask us for an outline on the correct path to take to trade stocks online. They just want a quick checklist on how to do this.
For one reason or another, I couldn’t find what I was looking for. It seems like there should be hundreds of good “How To Trade Stocks Step by Step” guides out there, but none were what I was looking for. So I decided to create one myself. Here goes…
How to Trade Stocks: Step By Step – Universal Investment Strategies
So, you’ve decided to trade stocks online, here are the steps you need to take. Cross out the ones you’ve done, complete the rest:
1) Take the time to learn how to trade correctly. This could take awhile, but regardless, DO THIS FIRST! (Tip: If you don’t follow this step, the rest of the steps are worthless)
2) Make a clear decision on what time frame(s) you’re going to trade. (Tip: Don’t try to day-trade when you’ve decided to swing trade and vice versa)
3) Decide, or develop what type of trading strategy or strategies you’re going to be using. (Tip: There are many different trading strategies out there that work, and even more that don’t. Find YOUR edge or strategy that fits YOUR personality)
4) Decide which brokerage you’re going to use. (Tip: This is the easiest way to lower your trading costs, choose wisely)
5) Think about what tools you’re going to need (chart programs, portfolio software, etc.) to best trade your chosen strategy. (Tip: Your brokerage may provide the tools you need, don’t pay extra for something your brokerage may already provide)
6) Once you’ve decided on which tools you need, take some time to choose which provider will best fill those needs. (Tip: A lot of the times you can get what you need for free online or for only a little fee; Don’t overspend for something fancy that you don’t really need)
7) Fund the brokerage account you have chosen. (Tip: Only use money you can afford to lose)
8) Become familiar with how your broker’s order placing system works. (Tip: Incorrectly placing an order can cost you big time. Learn the different stock trading order types AND learn how your brokerage’s platform works)
9) Have a method or program in place to track the trades you’re going to be making and a way of keeping trading notes. (Tip: If you don’t keep track of what you’ve done, you will forget. When you forget, you don’t learn from your mistakes and successes. A trading journal is very important)
10) Congratulations. You are now ready to trade! (Tip: Being lazy and skipping any of the prior steps will greatly decrease your chances of success. Don’t do it)
Online Stock Trading | I hope I’ve helped many with this checklist on how to trade stocks. Of course, each step could fill up many pages. But, simple is what I was going for here.
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