Stock Trading
 
 
The Nuances Of Using A Stock Trading Forum
        

A stock trading forum is where the transaction of stocks happens.  Typically one "bid"s (buying) for a stock which means it is the price that the broker buys it for. The price for which he will sell you is called "ask" (selling).  The distance between bid and ask is affected by some of the following: 55 

  • Liquidity angle
  • Volatility of the market
  • The spread is small
  • The spread is large
  • Market value
  • Markdown
  • Short sale
  • Overall balance between buyers and sellers

 
The higher the volume of trade, the smaller the spread.  The spread is large if the gap between the two is a lot.  When trading is less active or the traders are playing safe, market is usually large. This happens while the lunch hour also. The traders generally prefer small spread since movement is swift and helps to increase stop loss.  Some day traders take advantage of a large spread on the contrary. 

Where Can You Start?

There are various platforms available where one can trade stocks. Some of the common  and recommended ones are as follows : 

  • Trade Station
  • Gotrade.us
  • Ameritrade
  • NASDAQ Emini  Ninjatrader 

It is vital to tread carefully when starting.  Don't try to trade everything. Choose a maximum of three instruments. Learn about all the loop holes so that you become a specialist in those. Observe the markets closely. Maintain a journal where you keep jotting down all relevant points. Once you begin to understand the market somewhat the next step would be to identify your trading style and trading objectives.  Your personality should be in sync. Some people like numbers and are naturally analytical. Some people go by their instinct.

Some Books You May Refer To: 

  • The Black Swan by Nassim Nicholas Taleb
  • The Only Three Questions That Count by Ken Fisher
  • Jim Cramer's Real Money by James J. Cramer
  • Freakonomics Revised And Expanded by Steven D. L evitt & Stephen J. Dubner
  • The Pursuit Of Happyness by Chris Gardner
  • Fooled By Randomness by Nassim Nicholas Taleb
  • Against The Gods by Peter L. Bernstein
  • Enhancing Trader Performance by Brett N. Steenbarger 

An Ideal Trader

An ideal trader is a planner and an observer. He would make a comprehensive plan post close observation. He would then bide his time for the correct market condition that would produce profit as per the plan already chartered. However, forecasting market behaviour is as challenging as forecasting weather. And each one of us are driven by fear, hope and greed sometime or the other.  Most of the mistakes in trading happen when we let emotions come in the way of our decisions. To trade decisively, we need to keep our emotions under check. The mantra should be realistic and patient with an optimistic approach and you will be a successful trader.

 
 
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