How to take your first steps as a trader

Getting started as an online trader can be daunting. There are several risks inherently tied to the activity, including social media trading scams, loss of capital, and cybersecurity threats too.

The act of online trading itself refers to the buying and selling of assets, particularly shares in a company, over a set period. Traders start their activities in the hope of making a profit on each trade, plus making significant gains over time.

Before you venture out into this exciting landscape, it’s worth knowing a few top tips first.

5 steps to starting online trading

1. Understand the risks

Firstly, you need to accept that losses are a natural part of trading. Even professionals encounter major setbacks, so novices should always be prepared to lose some investments and approach any trades with caution. Never trade more than you can afford, especially at the start.

From overspending to falling for complex scams disguised by familiar brand names, the risks are far-reaching and often hard to spot. Financial markets are volatile and unpredictable, and there’s never any guarantee that the value of your assets will stay the same.

2. Choose a platform

Selecting a platform suited to your trading activities is critical if you’d like to be successful in your trading ventures. Do your research before getting started to learn about different platforms and their features, security level, user experience and more.

It’s a good idea to choose a platform suited to your level of expertise, too. If you’re a complete beginner, platforms like Tradu offer a reliable and user-friendly experience. There are plenty of options available, so just make sure that you’ve read through customer reviews before committing to a platform.

3. Learn the basics

It’s worth learning the core principles to trading beforehand.

Get to grips with key concepts like technical and fundamental analysis, market trends, risk management, and the psychology behind successful trading. There’s so much out there, so pick your niche and start your research.

Make the most of online courses, specialist resources and video tutorials too. Reach out to experts you trust if they’re willing to offer impartial advice and insight. With a solid foundation of the basic ideas and strategies, you’ll be in a stronger position to rise to those first few challenges.

4. Start out small

Remember, you’re a novice. Try to resist any temptation to dive headfirst into high-risk trades, starting with smaller investments and increasing your stakes over time as you gain both confidence and experience.

Some platforms offer stock market simulators, which allow beginner traders to practise before they get started with the real deal. Remember, you’ll learn with every trade you make – so there’s no need to dive in at the deep end.

5. Stay safe

Lastly, remember that safely trading online is about much more than just risk management.

Even though these techniques will allow you to become opportunistic, spotting the best entry and exit points, you should cut losses as early as possible. Don’t wait for the situation to get worse before pulling out with nothing left.

Use a secure browser and Wi-Fi connection, too. If possible, using a Virtual Private Network (VPN) will conceal your location and IP address from cybercriminals who may attempt to infiltrate trading platforms.