Key Lessons To Learn When Becoming a Spare Time Trader

Friday, February 14, 2020

We’re all looking for a few ways to make a little extra money in our free time. Whether it’s a side hustle that allows us to monetize or skills, a handy app that allows us to make a quick buck here and there, or even something as simple as moving our credit card debt around to new cards to pay less on interest and get more free cash with which to enjoy life. For those looking to make a little extra money in their downtime, the appeal of trading is undeniable, especially when there are so many apps out there that make it easy, while potentially offering more favorable commissions than you can expect from the average stockbroker. Still, it’s worth remembering that there’s really no such thing as passive income. And that if it were easy to make money trading in your free time, everyone would be doing it. 

Here are some lessons that you’ll have to learn if you hope to try your hand at trading in your spare time. Learn them and you’ll get closer to achieving your financial goals and getting the most out of your downtime…

Start small

Trading in penny stocks is a good way to get a feel for how the world of trading works and the metrics you need to watch when deciding whether to be bullish or bearish (whether to buy or to sell). Don’t get into penny stocks expecting to become an overnight millionaire- although that’s not to say that penny stocks are never profitable. Still, it’s important to keep your expectations realistic and use penny stocks as a way to learn the fundamentals. 

Expect to lose money… it’s all part of the learning curve

Nobody becomes a successful trader without taking a loss here or there. If you expect to be profitable instantly, you need to think a little harder about your expectations. This is why it’s so important to start small and get a good understanding of your market before you step up to the big leagues.

Use a VPS to keep an eye on the markets when you can’t

The markets are international, meaning that someone’s always trading somewhere. As you grow in experience you’ll come to realise the importance of keeping an eye on the markets at all times. In the digital age, many traders use sophisticated algorithms to watch the markets when they can’t. If you do this, however, make sure you use a VPS (Virtual Private Server) so you’ll never have to worry about dodgy internet connections resulting in downtime or missing out on the perfect trade.

And finally… take the time to know your market inside out

There are a lot of commodities out there that can be traded from foreign currencies to crypto currencies to stocks and shares to precious metals. Whatever you trade, however, it’s up to you to learn all that you can about your chosen market to help you to make well-informed strategic decisions. Don’t wait for someone to give you a hot tip (hot tips don’t stay hot for long). Find out the information for yourself to inform your strategy.

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