Think of the stock market and images of Leonardo DiCaprio in the Wolf of Wall street storming New York city earning millions in a whirl of corrupt, illegal activity may spring to mind. Though if not through glamorized crime, the next cleaner picture is of slick stockbrokers in swanky offices with a full set up of screens constantly streaming, eyes peeled for the next killing. Movie scenery and stereotypical suit types aside, anyone can, in fact, break into this market. The following are top tips for rookie investors.
Simulate Your Way to Success
The old saying practice makes perfect couldn’t be more appropriate here. As with any highly skilled activity, to throw yourself into the reality of trading straight away is not only dangerous but foolish. That is why you should start by using a simulation platform and try out paper trading first. The benefits of doing so are:
- Zero risk - Given that you are using fake money, the risk element is eliminated.
- Test the waters - Because of the above, this means you can experiment. As a beginner to the investment game, you’re bound to make many mistakes and losses. Simulation through paper trading gives you ample opportunities to see what works.
- Learn a methodology - As you continue testing and tweaking your approach, you’ll see that a strategy that is right for you will start to emerge. You can then take this with you when you begin trading for real.
- Save money in the meantime - Say you decide to paper trade for 3 months, in the meantime you can set money aside to add to your funds so that you have solid capital to get started with when you hit the stock market.
Watch Videos and Learn from the Masters
Nowadays, you don’t need a college degree in finance in order to be a successful investor. Many of the industry’s best are sharing their knowledge. They’re writing articles and have their own YouTube channels. They will teach you mantras such as pay yourself first, recommend books, techniques and platforms that they have tried and tested. You will see that the majority of these people were just like you. They saw a golden opportunity out there for the taking and worked out how to have their own little piece of it. Have your notebook, spreadsheets and software at the ready and be prepared to make notes. Watch five or six videos on the same topic and see what comes out as the most repeated and valuable advice. Best of all this learning method is mostly free and easily accessible.
It is a common misconception that stock brokering is simply about downloading some software, learning one of the many methodologies and hey presto – overnight you’re a millionaire. The truth is that making money takes time and genuine effort. It requires you to learn patterns, indicators and how to reach a consistent percentage. You have to seriously think about what you want out of your investments and how far you are willing to go. You ought to learn not only the jargon and terminology but also crucial details of the market you intend to buy stocks from. By no means do you have to become an expert in order to start your trading journey. Nonetheless, get clued up, taking a real interest and having the tenacity to understand the complexity and volatility of this world will stand you in good stead with your investment endeavors.