Do It Yourself: Stock Trading

The Internet has made it easy for millions of individual investors to trade stocks online. You still need a broker to trade, but its role is to provide online trading platforms and research tools and fast and reliable execution, for which it charges a minimum commission. It is easy to set up a stock trading operation from home and now increasingly from your mobile phone or laptop.

Brokerage Account

Open an account with a discount broker such as Schwab or TradeKing. The minimum opening balances vary from broker to broker but are usually very low. If you have $25,000 to invest it may be a good idea to get approved for day trading even if you are not planning to day trade so that you can buy and sell multiple stocks as necessary, without restrictions.

Trading Platform

Most brokers provide trading platforms to execute trades, create charts, and obtain basic stock financial information. Some platforms must be downloaded on your computer; others are web-based and can be accessed from anywhere. All platforms provide similar functions but have different implementations, so take the time to get accustomed to your platform.

Internet Connection

You can’t trade if you don’t have a fast Internet connection. Whatever option you choose, make sure the service is reliable and robust.

Own Research

The key to successful do-it-yourself stock trading is doing your own research. Good advice, including stock picking, comes at a price. If you want to make your own buy and sell decisions, you must select your own stocks.

Trading System

There are several profitable trading systems that you can learn online or from books that you can buy online or get at the library. Review several and select the one you feel most comfortable with.

Sources of Information

Your broker platform may provide all the data you need to make trading decisions. But no matter how robust a broker platform is, it is generally not a good idea to rely on one source for all your trading needs. The Internet is full of free and fee sites that provide useful information such as charting services, streaming news and financial data. Let your trading strategy determine what you need first and then you can set out to find the best sources of online investment information.

Join a Stock Trading Group

Trading is a lonely endeavor: it’s you against the world. Staying in touch with likeminded traders can provide moral support and help you learn faster and exchange trading ideas. Good stock trading groups come and go all the time and, again, are based on specific trading methods. Ask around to find a good group, identify the best traders there and use their experience and willingness to help to become a better trader.