Online trading has grown exponentially in recent years and continues to do so globally. Technology has improved market accessibility tremendously and has helped to simplify trading for beginners. Although trading is more accessible now, it doesn’t mean you should take online trading lightly, especially if you’re a beginner.
In this blog post, we’ve outlined the top 3 tips to help you start your journey to becoming a smart trader.
1. Do your research on trading brokers and market prices
As a beginner to online trading, your research should focus on two key areas — finding a reliable broker and understanding the markets you want to trade.
Selecting a reputable broker is crucial. Make sure to read reviews about the broker you’re eyeing, how they manage thriving markets, and the variety of platforms they offer. Go for a broker that provides user-friendly platforms for both beginners and experienced traders. Check out their list of trading assets, so you have options to choose from and can diversify your trading portfolio. Most importantly, verify that the broker is properly licensed and regulated.
Once you decide which broker to trade with, selecting assets to trade is your next step. The process of choosing an asset to trade doesn’t differ much from finding the right broker. Similarly, it takes a lot of time and research. A solid understanding of each market’s assets will help you make smart trading decisions confidently. It would also help to consider economic trends and world events, as these factors significantly affect market price movements.
You can trade between your preferred markets — whether it’s forex, stocks & indices, commodities, cryptocurrencies, ETFs, or synthetic indices (under derived indices). Diversifying your portfolio is a smart way to trade because it can protect you from losing all your money in case a market moves against your prediction.
If researching markets sounds complicated, you can start with trading synthetic indices on Deriv. Synthetic indices simulate real-world market movements, and are unaffected by natural events and free of market and liquidity risks. These indices offer the flexibility to trade different synthetic markets with high- or low-risk characteristics, and are available to trade on Deriv 24/7, even on weekends and public holidays. Have a go at trading synthetic indices by signing up for a Deriv demo account.
2. Use a demo trading account to test out your strategies
The best traders hone their skills through practise and experience, part of which involves handling losses. Most licensed and regulated brokers provide their clients with a demo trading account with virtual funds. You can use the demo account to practise and improve your trading strategies to find one that works best for you before jumping on a real account.
Demo accounts offer the same trading experience as real accounts, helping new traders familiarise themselves with the trading platforms.
Deriv’s demo account is credited with 10,000 USD virtual funds so that you can open trades, practise trading, and sharpen your strategies risk-free. All you have to do is register for a demo account to start practising on Deriv’s trading platforms.
3. Enjoy the process and practise patience
Getting started can be challenging, but it’s best to take your time and enjoy the process.
When it comes to online trading for beginners, patience is critical. Practising patience with your trades may help you discover what strategy works best for you. Never open a trade just for the sake of trading. It would be best to trade only when you’re confident with your strategy, after considering all external variables that may affect the market you’re about to trade.
It’s also important to note that to keep a disciplined approach to online trading, you should develop a strategy and stick with it. Trades don’t usually result in massive payouts. Losses are likely to occur, so stay realistic.
Many successful traders share the same characteristics. As a beginner, you could marvel at their success but, most importantly, analyse what made them successful. If you want to learn these traits and how trading experts plan their strategies, check out our Useful tips on how to trade online blog post, based on Vince Stanzione’s ebook, 7 Traits of Successful Financial Traders.
You might get tempted to start trading right away, but following these trading tips will help you get started quickly and keep you on the right track. With research, experience, and patience, you can navigate your way to trading success.