Beginners' Guide to Online Trading



Stock trading is definitely not a new concept and the first instance of share trading occurred way back in the golden age of the Roman Republic. However, the modern concept of stock emerged with the issue of shares by the Dutch East India Trading Company in the early 17th century. Over the past three centuries, the stock market has moved from the playground of a few to a considerably more level playing field, which allows entry to even individuals from middle income groups to freely trade stock, shares etc. Over the years, the field of trading has expanded to include investment opportunities not only in shares and stock but also debentures, forex, bonds, commodities, futures etc. Each of these sub markets feature different rules of trading and till very recently all trading required the physical presence of a broker at the stock exchange.

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Anyone who has ever visited a stock exchange would probably describe the place and people working there as completely crazy. In fact traditionally stock trading was one of the most strenuous jobs, which required an extraordinary degree of co-ordination between many different people. On the floor of a stock exchange, hand gestures are still used to communicate buying and selling of any specific stock, thus misinterpretation of a single signal can result in catastrophic losses. A major revolution in the field occurred with the advent of the Internet.


During the initial days of the Internet, security concerns limited its use to only checking the current trends of a stock, while the buying or selling orders were provided to a broker over the phone. Improvements in cyber security and the availability of high-speed broadband Internet led to a revolution in the field of share trading. Internet played the role of the great leveler, which allowed even more people to trade stocks whether they were an office or at home. Present day online trading allows people to complete trade from virtually anywhere in the world and on any stock exchange with the click of a mouse.


Many working individuals have taken to online trading as an alternate source of income along with their day job. This has only become possible due to the capability of online trading portals to grant their users access to stock markets from all over the world. Key services currently provided by available online trading platforms include stock option trading, forex (foreign exchange) trading and stock trading. A key benefit of online trading apart from the convenience is its ability to provide users with detailed records of all transactions carried out by them.


During the course of one working day, a user can complete a number of trades and using paper-based systems is quite inefficient in such cases. To resolve this and related issues, online trading websites provide solutions such as:
Trading Diary: A downloadable document, which records each and every trade carried out by the user account during a specific time period ranging from a few days to even years. This document will also contain details of profits/losses etc. made in each trade and can be considered as a balance sheet of your trading concern whether your trade individually or as a group. The system is automated and no user can manipulate the trading details.


Stock Trading Journal: This solution is similar to the trading diary, but is limited to recording only stock transactions carried out by the user account.


Forex Trading log: Only records and displays the foreign exchange trades completed by the user account. Similarly, other logs or journals can contain details of commodities or stock options traded by the user account. In all cases, online trading provides a substantially more economic and efficient way to order and complete trades, while empowering the trader to choose his/her trades as well as timngs.


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