Since I shared my trading portfolio on my social media, I’ve been receiving questions from ladies on how stock trading works, what are my strategies, and how one can be successful real quick? These are interesting questions but let me just have a disclaimer here that I am not a professional trader hence I am only sharing non-technical advice about stock trading for women.
First of all, no investment comes without risk, it is important to understand that trading is a risky business, and the stock market is known for being volatile. Meaning market crashes, like those companies associated with the Great Depression and the 2008 financial crisis. I don’t advise you to risk all your hard-earned money in trading if you don’t have more savings. We will get more to that part later.
#1 DON’T ASSUME YOU KNOW IT ALL. STUDY INTENSELY
When people tell me they trade, I usually ask them specific questions if they are familiar with financial terminologies. If the answers are generic, you’re not a legit trader but you know what? IT IS OKAY that we don’t know all the things because everyone been there too.
I suggest studying a crash course in the market analysis of technical handbook. Among the chapters that helpful for me before are, Price Momentum Indicators, Support and Resistance, and The Fibonacci Concept.
#2 DO YOUR OWN RESEARCH
Don’t create a trading account until you have done your homework. Do your own intense research on which trading platforms are good to use, check carefully the reviews, and understand how stock trading works. Take your time because, in trading, patience is the key.
I didn’t create an account until I really understand how it works and the risks. It is important to know that trading is not really an investment but a gamble.
#3 START WITH LOW-RISK STOCKS
When I was young my parents gave me and my sister money. My older sister spent it right away on shopping she doesn’t need while I kept my $50 in my piggy bank. Your spending behaviour will also determine how you react when you have money. Start with low-risk stocks and don’t spend your money on the shares you have no knowledge about or you don’t honestly think you will use it for the long-term.
#4 STAY RATIONAL NO MATTER HOW EXCITING THE TRADING
According to my business partner John who is a serious trader that the stock market is volatile and members of the media may amplify whatever developments took place. You need to balance your thoughts when reading the market news or else you will get stressed out and may end up risking everything and lose it all at once.
Additional tips: women suffer from swing moods every month and we make silly decisions when we have a period. Don’t invest when you feel like you are not being rational. No one wins when you make irrational decisions.
#5 DECIDE WHAT TRADING PLATFORM YOU WANT TO USE
There are many trading platforms but select carefully based on your level of experience.
- Merrill Edge associated with Bank of America. You can start trading for as low as $600 to open an account.
- E-trade is advisable for brokers and retirement accounts. Deposit starts at $5,000-9,999.
- Interactive Brokers is a platform for professional trading account that starts at $100,000.
- Trade Station account minimum is $2,500.
The available trading products are stocks, ETFS, IPO, crypto, mutual funds, and bonds. How you want to trade depends on which product you are comfortable to use.
#6 UNDERSTAND WHEN IS THE RIGHT TIME TO TRADE
My friends ask me when is the right time to trade? While you are ready to take up all your energy for trading unfortunately it runs 24-hours a day, five days a week the foreign exchange market is a convenient way to trade all day long. To strategize how to work smart in trading, one must understand the forex market hours that are scheduled by forex market participants that buy, sell, exchange, and speculate on currencies all around the world.
The forex market opens on Monday morning at 8 am and closes at 5 pm New York local time. Hence, you need to strategize your trading schedule according to your local time zone so you can keep it up.
Tip: spot prices for the day are set during the London/New York overlap period.
Personally, I work for my startup from noon until after dinner every day in my home office. Then I hit the gym for just 30-mins session each day and I start trading in the evening in Singapore (8 am NY Time). Since I can’t be up all night because it will affect my mental health I strategize by working late only a few times a week so I don’t crash.
#7 IF YOU CAN’T UNDERSTAND TRADING, HIRE AN EXPERT
Trading is complex and no basic finance knowledge will help you become an expert immediately. It takes experience and professional knowledge on how to strategize your trading game. Trading is not a simple accounting that you can add the numbers in an excel sheet.
If you need a professional guide, hire the service of a broker in FX, CFD, Crypto, and BO trading. They will be able to advise you on technical analysis, news, and market updates.
As an MBA grad and a technical writer, I understand economics and I have an interest in trading. However, there are times that I am clueless on how to strategize to win. Therefore, I watch live market commentaries, real-time updates of global economic events, I read articles in technical analysis, I join the forum in forex broker reviews, and I follow traders on YouTube who give trading strategies. I make efforts to understand and I don’t assume I know it all because I don’t.
In short, no matter what is your foundation or expertise, you need continuous learning in financial markets e-learning, education, and training content.
Thank you for reading and I am wishing you all the best.