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Stocks

Academy

Get Familiar With the Terms and Strategies for Wise Trading

Stocks

Stock trading refers to the buying and selling of stocks by active investors. Stocks, also known as equities, represent ownership in a company. When you buy a stock, you're purchasing a small part of that company which entitles you to a portion of its profits and assets. While stock is a more general term that refers to the overall ownership interest in one or more companies, shares are specific units of stock within a particular company representing your ownership portion.

Stocks are traded on stock exchanges like the New York Stock Exchange (NYSE) and Nasdaq. During market hours, buyers and sellers come together to trade shares.

Stock CFDs

CFDs (Contracts for Difference) on shares allow traders to engage in the stock market without actually owning the actual shares. CFDs are contracts that enable traders to profit from the price movements of stocks. Traders analyze stock prices and trends using charts to decide when to buy or sell. This market lets investors trade CFDs based on stock prices, allowing them to profit from market fluctuations without owning the underlying shares.

How to Earn

Buy shares at a low price and sell when prices rise to earn profit from stock trading. Also, research companies and monitor market trends. Manage risk by diversifying your investments and setting loss limits. Patience, research, and emotional control are key to successful trading. As a practice, some traders buy and sell within a day for quick gains, while others hold stocks longer for better value.

On the contrary, trading stock CFDs allows you to speculate on stock price movements without owning actual shares. This approach allows you to control larger positions with less capital, which can boost potential profits, but it also increases risks as gains and losses are tied to the full value of the position.

CFDs let you profit from both rising and falling markets by choosing Buy or Sell positions. They provide access to global stocks, making portfolio diversification easier. However, overnight positions incur fees, making CFDs more suitable for short-term trading.

Opening a CFD account is quicker than a traditional brokerage account, ideal for quick trades during market events. While both CFD trading and stock investing offer opportunities, CFDs focus on short-term gains while stock investing is for long-term growth. Choose based on your financial goals.

Terms to Know

Bull Market - A market condition where stock prices are rising or expected to rise, typically reflecting investor confidence and economic growth.

Bear Market - A market condition where stock prices are falling or expected to fall, often indicating investor pessimism and economic downturn.

Blue Chip Stocks - Shares of large, reputable, and financially sound companies with a history of reliable performance, often considered safe investments.

Dividend - A portion of a company's earnings distributed to shareholders, typically in the form of cash or additional stock, as a reward for holding the stock.

P/E Ratio (Price-to-Earnings Ratio)- A valuation metric that compares a company’s current share price to its earnings per share (EPS), used to assess whether a stock is overvalued or undervalued.

IPO (Initial Public Offering) - The process by which a private company offers its shares to the public for the first time, transitioning to a publicly traded entity.

Index - A statistical measure of the performance of a group of stocks, such as the S&P 500 or the Dow Jones Industrial Average, representing the overall market or a specific sector.

Something nobody tells anybody……

Stock trading is a difficult and risky enterprise, but with education you can work to lower risks and increase your likelihood of success.

One thing that often isn't emphasized enough in stock trading is the emotional discipline required to be successful in trading stocks. While technical analysis, market trends, and financial data are crucial, controlling your emotions is just as important. This is because market fluctuations can trigger fear and greed, leading to impulsive decisions like panic selling during downturns or overbuying during rallies. The most successful traders develop the ability to remain calm and stick to their strategy, even when emotions are running high.

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  • Tested Strategies

  • Tools to Use

  • 1

    Day Trading

    Day trading means buying and selling stocks within the same day to make quick profits from small price changes. It needs constant attention, quick decisions, and staying updated with news that could impact the stock’s price.

  • 2

    Position Trading

    Position trading involves holding onto stocks for a longer period, from days to months, to benefit from big price trends. It’s less immediate and allows traders to monitor general market trends rather than minute-by-minute moves.

  • 3

    Swing Trading

    Swing trading aims to catch short-term price swings over several days or weeks. Traders use charts to spot trends and try to profit from these brief price movements, looking for stocks with frequent ups and downs.

  • 1

    MT-5 (MetaTrader 5)

    MT-5 is a trading platform that’s packed with features and great for stock trading. It has over 100 indicators and a variety of charting options, so you can dive deep into market analysis. It also supports automated trading, letting you create and run your own strategies with its built-in scripting. Whether you're a beginner or an experienced trader, MT9 gives you real-time data and the tools to trade with precision.

  • 2

    Saturn

    Saturn is a smart trading platform that uses AI to help you make better trading decisions. It’s all about giving you predictive insights with its machine learning tech. The platform is super easy to use, with customizable dashboards and advanced charts. Plus, through its social trading feature you can follow successful traders and copy their strategies. It’s a perfect pick if you’re looking for a modern, intelligent approach to trading.

  • 3

    TradingView

    TradingView is a handy app for screening stocks and keeping an eye on price trends. It’s ideal for those who want to learn about trading, as it shows how market trends change over time. You can even use it on your phone and add custom scripts to personalize it.

  • 4

    Bloomberg

    Bloomberg is a top-tier trading tool known for its power and reach in the financial world. Terminal gives you real-time access to global markets, covering stocks, bonds, commodities, and more. It’s advanced features like charting, financial analysis, and Bloomberg Intelligence and News keep you updated. With integrated trade execution, Bloomberg is perfect for traders who want detailed market coverage and an edge over the competition.

  • 5

    Economic Calendars

    Economic calendars, like those provided by Investing.com or MarketWatch, help you keep track of upcoming economic events like interest rate changes or job reports. Knowing when these events are happening can help you anticipate market moves and tweak your trading strategy.

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