Online Trading Options That Will Make You Rich

Online Trading Options That Will Make You Rich

Trading financial instruments online is a risky business. You can lose all your investment capital and any profits made. Even so, without risk, there is no reward. With proper risk management and patience, there is a lot of money to be made. Find below, three online trading options that will make you rich.

Stock Market Trading

This is also known as the equity or share market. Companies are constantly selling their shares to those with trading accounts, intending to raise money for their operations. Become a shareholder in a company by buying and selling their stocks. You choose whether you want to be part owner in a publicly listed company, or in one that trades privately. A public listed company will be found on a stock exchange in the country where the company is based. Exchanges in other countries may also trade the same stocks. The stocks may include oil, silver and gold, among others.

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Privately traded shares are usually done through equity crowdfunding platforms. Depending on how many shares you buy, how the companies perform annually and the trading strategy that you choose, this is one of the online trading options that will make you rich.

Stock trading is usually done through brokerage firms and electronic trading platforms.

Trading in Bonds

This is when you lend your money to an entity such as government or publicly traded corporations, to finance large infrastructural developments, or pay off huge debts. It is usually long-term and is typically done through brokerage firms. Your money is consolidated with that of others to get the total amounts to be lent out. As a lender, you get interest paid to you on a term basis that could be once, twice or four times a year. You do not need collateral to trade in bonds, but they are more highly regulated by authorities. As a retail investor, you can buy bonds in relatively small denominations as they will be put together with others’ trades. Buy several bonds at relatively significant prices and this online trading option will make you rich in time. This is a less risky option of online trading as interest is paid up-front.

Trading in Foreign Exchange

Become a part of the $6 trillion-a-day, over-the-counter currency exchange market that runs for 24 hours a day, 5 days a week, without fail, except on weekends. It is global, decentralized and determines the foreign exchange rates for every currency in the world. In terms of volume, it is the largest financial market in the world. The participants in this market are in several categories beginning with the large international banks on one end, and retail investors on the other.

As a retail investor, you can trade individually online, or you can use a “dealer” who will trade for you and pass on the profits to you, less the commission charged. This latter way of trading may be very risky as you may not be able to “prove” how much profit you made in a trade. It is better to learn how to trade the markets as a retailer and enjoy your profits. You can always learn how to do so from online tutorials and signing up with reputable companies that will allow you to open demonstration accounts. Use the demo account to learn the ropes, before investing real money in live accounts. Once you master the basics and trading strategies, trading foreign exchange is one of the online trading options that will make you rich. You can always start with relatively small amounts of money and grow your portfolio based on your risk appetite. 

Final Thoughts

The web is a very useful place to obtain information before starting your online trading. You should also have a trading strategy for the options that you choose to engage in. Risk management, patience, and proper planning will enable you to get involved in online trading options that will make you rich.

Geoffrey Nevine — IT Services and IT Consulting

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