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Monday, October 19, 2009

Stock Trading The Right Way

By Mike Swanson

It is true that stock trading is one of the most lucrative methods of earning money when using technical analysis. It does not require a large investment to begin trading in stocks besides it allows immediate liquidation.

Learning the basics starts with the terminology used. The language of the market will also be in sequence with the steps to trading. Trading actually means to buy and sell stocks. The way you buy and sell stocks will happen in two ways. You will trade electronic and off the exchange floor. The difference is the NASDAQ uses electronic and the NYSE trades stocks off the exchange floor.

The electronically traded stocks work off a computer network on the NASDAQ and matches buyers and sellers. You can find pension funds, mutual funds, and more. Most prefer this method of trading. The reason for this preference is the advantage of keeping up with your investment and working from the online network. You still need a broker in order to access the NASDAQ. You can keep up with your investments while beefing up your portfolio.

NYSE works through brokers, so you need a broker to buy your shares. Then the brokers clerk will notify the exchange floor clerk about your trade. The floor clerk will announce it as a broker's trade on the floor. The brokers work together already familiar with each other, they sell your shares.

Brokers work together and become familiar with the others stocks. When your broker agrees with a price, you will be contacted by the brokerage house for your answer to take the offer or not.

After the deal is finalized, you receive a mail confirming the deed. This was the basic deal; large blocks of stocks are traded everyday in complex detail, involving complex trading. - 23212

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