Start online CFD trading
Trading is simple, as long as you know what to do. Many websites use a lot of intricate terminology and try to scare novice traders. They try to make you feel stupid. This is not the way we work! Trading should be fun and we are willing to help you to get started as a trader. Besides some very useful articles for beginning traders, we also provide a very useful three-step plan that you can use to become a successful trader as well.
Three-step plan to start trading
Trading involves the buying or selling of financial instruments with the purpose of obtaining profits. This includes trading in inter alia, Forex, stocks, commodities and indices. Most people think that trading is complicated and that it is necessary to invest a lot of money to achieve a decent profit; this is absolutely not the case. In this article we will examine how you can start trading as well.
- Obtain high yields, even with a small capital
- Always make money, even if the stock markets fall by going short
- Automate your trades through the use of orders
- Achieve better results thanks to the leverage
- Try and practice trading for free!
Tips for the new trader
If you have never traded before it is wise to start with a free demo account first with a broker like Plus500. Plus500 offers simple yet excellent software which make it possible for everyone to start trading in for example the EUR / USD, gold, Facebook, or the DAX30. When you use a demo account you trade with virtual money, you begin with an initial capital and you can open and close positions just like you would for real money. Trading with a demo account is exactly the same as trading with real money, except that you don’t have to worry about losing money: after all it is only fictional money!
How does trading work?
The principle of trading is actually pretty straightforward: you buy or sell something in order to buy or sell it again later for the purpose of making profits. In recent years, thanks to the introduction of various online brokers, it has become possible to both go long (buy) and go short (sell). This allows for making money in both rising and falling markets.
For example: when you think that the share price of BMW will decrease because German consumer sentiment has fallen sharply, you may decide to sell the shares of BMW. We also call this “going short”. As soon as the share price of BMW drops your trade becomes profitable.
The good thing therefore is that you make money regardless of the direction of the market. With this new way of trading you just have to decide whether you want to buy or sell and at what time. When the position is opened profits or losses are recorded in real time and once you close the position your profits or losses are definitively added to your account balance.
Tip: Check out our simple course “trading CFDs”.
In the previous paragraph we already briefly discussed that certain news facts might influence share prices or foreign exchange rates. This is called fundamental analysis. Besides, it is also possible to trade based on recognized patterns in graphs. This requires some understanding and practice but as you have done this a couple of times you will soon get better at recognizing these patterns. Many people who start trading quickly recognize these patterns and know thus know the best time to open and/or close a position. Ultimately, trading is a game of supply and demand whereby a trend reversal marks a shift in the relations between them. A price can decline very fast to a low value and then rise again: in such a case buyers are again willing to buy at this current, lower price.
Even without complicated technical analysis patterns can often be easily recognized at a glance. At each time frame certain “lines” can be found which are rarely crossed. By taking into account these “lines” you can ensure you will make profits 70 to 80 percent of the time, and that’s more than enough!
Trading is fun, exciting and above all very profitable. As a beginning trader, you will have to get used to some terms, but you should not worry about that. Once you’ve done a few trades with a broker you will soon become an excellent trader. All successful traders once started, the question is whether and when you are ready to start trading.