Online stock trading sites offer investors access to a variety of tools and research that just a few years ago were only available through full service brokerage accounts.
There are many online stock trading sites to choose from, but narrowing down the field may seem time consuming and overwhelming.
Online stock trading sites offer investors a wide range of tools, research and services.
Finding the right one for your style of investing and that meets your needs is a matter of visiting the sites to get a feel for the interface.
Pay attention to the fee structure and how it works with your trading style. If you are an infrequent trader, look for maintenance or inactivity fees.
If you want advice, see how that affects your trading costs.
Many of these sites will let you open a demo account, which will give you an idea how the real thing works.
Major Stock Exchanges
The New York Stock Exchange
The most prestigious exchange in the world is the New York Stock Exchange (NYSE)
The NYSE is the first type of exchange, where much of the trading is done face-to-face on a trading floor.
The second type of exchange is the virtual sort called an over-the-counter (OTC) market, of which the Nasdaq is the most popular. These markets have no central location or floor brokers whatsoever. Trading is done through a computer and telecommunications network of dealers.
American Stock Exchange
The American Stock Exchange has suffered from a lack of attention compared to the bigger and better known NYSE and NASDAQ, however it is a large exchange in its on right and home of some innovative products.
Chicago Board of Trade
The Chicago Board of Trade handles commodities futures and options. Although it doesn’t make a market in individual shares of stock, the CBOT is an important part of our economy.
London Stock Exchange
The London Stock Exchange (LSE) is a stock exchange located in London, England. Founded in 1801, it is one of the largest stock exchanges in the world, with many overseas listings as well as UK companies.
Types of Trading
There are several types of trading styles that persons seeking to profit from short term trades in the market may wish to use. Here is a brief description of the most widely used short term trading styles.
Day traders buy and sell stocks throughout the day in the hope that the price of the stocks will fluctuate in value during the day, allowing them to earn quick profits.
The principal difference between day trading and swing trading is that swing traders will normally have a slightly longer time horizon than day traders for holding a position in a stock.
Position trading is similar to swing trading, but with a longer time horizon. Position traders hold stocks for a time period anywhere from one day to several weeks or months.
Online trading is not really properly described as a trading style. Rather, online trading is simply a term that refers to the medium used to enter and execute trades.
Buying & Selling Stock
Buy low and sell high is the ultimate guide to successful stock investing. It is also the reverse of what many investors do.
Investors read about a stock’s rapid rise and want in on the action. Unfortunately, if they don’t do their homework they may not know that the stock has been run up way past its intrinsic value and it set up for a major sell-off as investors who got in early take their profits and run.
This mindset also explains why investors dump a stock at the first bad quarter or dip in stock price – the stock must surely be headed downhill forever.
If you don’t know the company’s business, it is easy to get spooked when a few bad numbers show up on quarterly reports. However, if you know something about the company, you’ll understand the numbers better and be able to decide whether a poor quarter is just a bad quarter or the beginning of bigger troubles. One bad quarter is usually not a reason to dump a quality stock.
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Hong Kong Exchanges and Clearing Limited
Securities and futures exchange in Hong Kong.
Korea Stock Exchange
Information on South Korea’s stock exchange; stock, bond, futures and options market data