Is stock trading online a good idea?

Updated: Oct 15

In the UK etoro is pushing their brand very strongly with TV adverts and Alec Baldwin as a strong celebrity endorsement.


Why?


The Coronavirus pandemic is proving to be a fortunate boost for FinTech’s. Financial technology (Fintech) seeking to improve and automate the delivery and use of financial services, playing strongly into the hands of new social media friendly platforms and audiences.

New consumers have had their interests peeked by online financial opportunities and simple to understand platforms affording newbies to enter the market quickly with little experience.


With prolonged social distancing measures and lockdowns around the globe, people are reassessing everything and perhaps this accelerated interest in fintech. History repeats itself and the new world order is changing, no one wants to speak to their bank manager, are there any left? or investment advisors, why should they when all the information needed is at a touch of a button. Blogs, reviews, opinions are shaping a new breed of traders eager to play the markets. The 2008 financial crisis drove many customers from traditional financial institutions to the fintech sector. The present Coronavirus crisis has changed everyone’s way of life with more working from home and enabling them to research what they want and how to achieve it. FinTech’s allow consumers to look after their finances remotely.


Why trade online?


There are many ways, Forex, Options, CFDs to name the most popular.


What are CFD’s?


Firstly, we need to understand that trading online with a CFD broker is different than buying and holding an equity/stock for a long-term investment.

CFD trading is an instrument that allows the trader to enter the market for a short period and speculate on the movement of the stock either up or down without physically owning it, this could be for a week , as little as a day or even a few hours, as an example as a Listed company producers its latest earning report. This usually moves the stock especially after the CEO’s forecast for the next quarter.


https://www.investopedia.com/terms/e/earnings.asp#:~:text=Earnings%20typically%20refer%20to%20after,successful%20in%20the%20long%20run.

Investing in a stock, either via a broker, bank, or pension fund, is an approach that works on the buy and hold principle. Therefore, you buy and hope it rises over the years. Sometimes you also get dividends, depending on the sector.


https://www.investopedia.com/ask/answers/12/why-do-some-companies-pay-a-dividend.asp


Therefore, long term investment with the assistance of a recognised financial advisor or financial institution could be the safest form of investing long term. Maybe.

With the advent of the internet, Fintech has grown exponentially allowing retail traders, smaller players to play the market with less capital & time or even knowledge.

Trading online CFD’s for a beginner is risky but with the potential to enter the market with little capital and many make excellent returns.

The principle of trading is the same for all investments, buy low sell high, but you can short in CFD trading and make returns.


To enter the CFD market needs discipline, It would be naive to state it is easy but with the support of experienced traders, this could help you achieve a decent return in a shorter period of time than traditional investments.

Many chose to Copy a trader at the begiining.


https://www.investopedia.com/terms/e/earnings.asp#:~:text=Earnings%20typically%20refer%20to%20after,successful%20in%20the%20long%20run.

Confused which broker?


We help new traders to discuss our recommended brokers, their fees and regulation, minimum investment, and types of platforms.

To trade stocks online you need some technical skills, how to open the trade, as well as understanding fundamental analysis. However, both can be developed over time. A perfect mix of both comes with experience. Do learn the fundamentals and develop skills and you will hopefully succeed and enjoy it.


It is a bit like marmite, you either love it or hate it.

#insiderkk

I


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