Online stock trading?

By wastedkill ยท 6 replies
Sep 26, 2013
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  1. Has anyone done any online stock trading? I would like to get into it myself but have no idea which site will be legit and wont require me to keep $5000 in the account lol, if you have can you post your experience and the site you used/site that was best for you.

    Thanks and I just don't see why there isn't like world trade center online or nasdaq trading seems a bit useless to have a site that doesn't allow for stock trading :/
  2. slh28

    slh28 TechSpot Paladin Posts: 1,706   +172

    Use a spread betting site: faster execution, more products, more leverage (be careful obviously) no need to bother with holding physical stocks, no brokerage charges, no tax (in the UK, not sure about the US).

    Just read up a bit and make sure you don't go overboard with the leverage and you'll see it's way better than trading physical stocks.
  3. wastedkill

    wastedkill TS Evangelist Topic Starter Posts: 1,423   +350

    Would rather do stock trading tho lol Im also in the US but those prices are pretty much same for US/UK sites its hard to find a online stock trading site where you can actually trade stock without having a 6figure income which is just plain bad.
  4. slh28

    slh28 TechSpot Paladin Posts: 1,706   +172

    You can trade on individual stocks on spread betting sites. You're still betting on the direction of the stock, it's just that you don't own them. Almost all of them will have a practice or demo account so you can try it out before you use any real money.

    I don't see why you need a six figure income to trade stocks, if you have enough deposit to invest then surely they would take your money and you can start trading.
  5. davislane1

    davislane1 TS Grand Inquisitor Posts: 4,737   +3,757

    I'm an active futures trader and a finance major, so I'll try to address your post as best as I can.

    Firstly, you need to understand what you're getting yourself into with active trading. Given your question, I'm going to assume that you're completely new to trading and encourage you to do a lot of research on the occupation before ever considering opening a trading account.

    Like small businesses, short-term traders have a very high failure rate, especially stock traders. It's somewhere in the ballpark of 90-98 percent (depending on your source). Of those who don't blow away their capital, few are able to be consistently profitable and fewer still are able to derive a livable income off of their trading activity. My point: this is not about easy money (although professional traders tend to make it look that way). It's a skill that takes a lot of time and a lot of effort to properly develop as well as a general understanding of market behavior and mechanisms. If you don't possess those two things, you're going to lose more money faster than you ever thought possible.

    Secondly, you're never going to find a broker who lets you trade for free (unless its a demo account with fake money). For stocks, the minimum account balance is $25,000 for active day trading, as per regulations. For futures, the minimum depends on the contract but tends to be much cheaper when dealing with e-mini's (generally in the $2000-$5000 range). You can trade with smaller balances, but only in a long-term buy and hold capacity. There are also additional costs associated with short-term trading, including the data and platform fees. Minimum, you're looking at an additional few hundred dollars per month in bills. Commissions will also vary between brokers. As a client with Tradestation, my round-trip commission for futures is $2.40 per contract.

    Thirdly, and I cannot stress this enough, you MUST thoroughly educate yourself on the difference between gambling in the markets and actually capitalizing on real opportunity. The function of these markets is specifically to transfer money from one account holder to another. This means they are competitive and that major market participants (institutional traders) are not going to be using mass-adopted trading strategies -- they will be taking the other side of those strategies to fulfill their order requirements. Because their analysis and expertise is by far superior anything marginal speculators are going to possess, trading these types of strategies is no different from playing an extremely expensive slot machine in Vegas. If you want to find a trading system that works, you're going to have to either spend a lot of time building and testing one or you're going to have to find a mentor who can teach you (I myself have been instructed by a couple of CME floor traders and several electronic traders). Moreover, you need to have a thorough understanding of risk, how to reduce it, and how to manage it. If you don't, it'll eat your account up like a 5yr old in a box of Oreos.

    I realize this is a bit much than what you were asking for, but I've personally seen people lose (net) tens of thousands of dollars trying to trade these markets. Even successful traders lose (gross) money regularly. So, before saying "go out and do this", I'd rather you know what you're getting involved with first, because it sounds to me like you're in virgin territory. Hopefully you find this helpful.
    misor and Ranger12 like this.
  6. Ranger12

    Ranger12 TS Evangelist Posts: 621   +122

    I would take the 5k and start a Roth IRA with it if you're younger. Especially if it is money you can't afford to lose. If it is money you're willing to lose then trying your hand at stocks is not necessarily bad. Not saying you will lose it, but short term and penny stock trading is about as risky as it gets.
    If you have a google account you can use google finance to keep track of stocks. You can enter how many shares of what stocks you have and when you purchased them and it will keep track of them. It's a fun little way to play around with theoretical stocks without risking any money.
  7. jassielarry

    jassielarry TS Rookie

    Best way is to have an account with brokers who having minimum brokerage charge....

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