What is trading?
There is no doubt that the buzzword is trading, an activity with a very clear objective and of which we are going to give you some introductory guidelines. If you need to know what trading is all about, don’t hesitate to join us.
What is trading and how does it work?
Trading is speculative stock market operations, this word does not have a negative connotation here, and its objective is to reap economic benefits from these operations. In other words, buying when the price is low and selling when it rises. This difference is what allows us to obtain a capital gain and, in some cases, to turn this activity into a way of increasing our income.
In order to trade we have to follow the opening hours of the different markets, as you can buy shares of all kinds, from commodities to currencies, the so-called Forex market. The latter is open every day of the year, 24 hours a day. Contrary to the misleading and misrepresented image, trading requires a lot of discipline and knowledge, so if you make the effort to educate yourself, your chances of success will be greater.
That does not mean that you are not going to have disappointments, it is part of the learning process. There are different ways of trading, either day trading, swing trading or trend trading, each adjusted to a specific profile, so as you discover how the operation works, you can use one or another type.
Why you shouldn’t trade
This headline may catch your attention, indeed we are dedicated to bring the world of investment to anyone who wants it, but there are some reasons why you should not do trading, read well before you dive headlong into it.
Firstly, it requires constant attention. Trading is a far cry from making a purchase and forgetting to reap the rewards later. No, the time you devote to it has to be exclusive and with as much concentration as possible. This brings us to another reason why you should not trade, it can be psychologically crushing. Having total control of your emotions and nerves of steel are essential elements to achieve our goals.
On the other hand, trading involves an initial investment. You can’t start with €10, you’ll need a lot more and you won’t be sure of a return. For that reason, before you continue, it is always a good idea to register with a broker that has a demo account. These allow you to trade with real values, but with fictitious money. This way you can have a totally realistic view of how much you win and how much you lose. Make no doubt that you are going to lose money, it is part of your journey as a trader in the beginning. Even those who have been doing it for a long time lose.
Finally, trading involves a high investment of time that will be spent on training, studying charts, moving around the world, listening to expert opinion and spending time in front of a screen. If you are determined to go through all this, all you have to do is be strong and don’t let your strength falter, the result can be worth it.
Advantages of trading
For people who have a free, but not anarchic lifestyle, trading is another possibility to earn extra money. The most important factor is time, if you have it at your disposal, you can use it to make trades that lead you to live in a different way.
How to avoid being affected by inflation
Unfortunately, inflation is a very topical issue. At the time of writing, inflation in Europe is high and in Spain it has shot up to 8.7%. To sum it up quickly, inflation is how much prices are rising and the cause of money losing value. Realistic, analytical and scientific trading will increase your winning positions, get money back and, of course, protect you from inflation. This is because you will increase your income and avoid going into debt to continue living, which is unfortunately a very common practice.
We insist on the importance of training, doing trading is not to arrive and kiss the saint, it has a huge work behind that, too often, is not seen. If you have taken a stroll around the supermarket these days, you will have noticed that most of the products sold there are more expensive.
How to increase your savings
Many people who started out trading as a casual activity have gone on to make it a way to increase their income and, therefore, their ability to save. Trading is not about getting in and getting rich, in fact, those who go in with those intentions quickly achieve the opposite. If you keep a cool head and set aside a certain amount of your earnings, you will be acquiring financial freedom and you will have a basis for anything. Get the idea that trading is about casting the net and catching fish, not filling the boat immediately. If you are willing to make trading a way to hold on to your savings, you can do it as long as you take small steps.
How to live from anywhere
Do you have a laptop and a permanent Internet connection? In addition to time, you already have the necessary elements to be able to set up your office anywhere. Now, discard the idea of the trader trading while sipping a mojito on the beach. That’s not the way to do it, nor is it your goal. If you are a person who is constantly on the move, this will not prevent you from dedicating yourself to your investments. By spending time every day, being consistent and taking each step well, you can make trading an exciting activity that can be done anywhere.
Therefore, trading can change your way of life, acquire very interesting knowledge for your whole life and have the possibility to save for a future that, unfortunately, is becoming more and more uncertain in the economic aspect.
In addition, you can earn money by helping others earn money, sharing your trades, or copying the trades of more experienced traders. Discover the benefits of social trading.