Five tips to make the most of beginner trading apps
There are many beginner trading apps you can choose from. While some are better than others, you still need to develop your skills to use them effectively.
To help make sure you get off to the best possible start, here are five tips to make the most of beginner trading apps.
1) Open an account with a good app
There’s an almost overwhelming variety of trading apps from which you can choose. Professionals use apps like IG and FxPro. But these are complex and not aimed at those just starting out. So it’s best to open an account with an app like eToro or Robinhood.
Creating an account is as simple as any other piece of software. If you want to set up a business for trading, you will need to register for a Legal Entity Identifier. This is a unique ISO 17442 ID that identifies the company buying and selling equities in the markets. It’s not required as an individual trader.
2) Study trading and stock markets
You can dive straight into making trades as soon as you have opened your account. But you will lose money. eToro’s own research found that over 80% of day traders lose money over the course of a year, amounting to an average of 36%.
While you can’t guard against losses, you can help yourself by learning at least the basics of trading. These include diversification, swing trading and which stocks to altogether avoid. Some of the best ways to study trading are by reading financial articles, watching Bloomberg and CNC, and studying textbooks.
3) Analyze beginner trading apps
Before making a decision about any trade, you need to analyze everything. First, you need to know how your chosen app works. One wrong tap of your finger or click of the mouse could spell disaster. It’s also helpful to learn from the professionals.
eToro, for example, has a social media style interface where experts often post valuable articles and analyses. Finally, simply watch the trading action unfold in real-time to get a sense of how minute-by-minute trading actually works. It can take around six months to learn how to consistently trade successfully.
4) Use any available simulator
Trading is a complex and volatile system. And anything can go wrong at any time. Fortunately, some trading platforms offer simulators so you can practice without risk. For most, it’s simply a case of switching in the app. Then you can make trades without real money on these apps:
- Wall Street Survivor
- Pilot Trading
- Warrior Trading
Virtual trading might seem pointless since you might even have some success. But it’s highly recommended so you don’t lose real money on trade after trade as you learn the craft. In addition, these apps are excellent for testing strategies until you find one that works for you.
5) Consider a trading course
Like anything, you can learn to trade through good old lessons. There are college courses and online courses you can take. These will teach you the fundamental principles of trading and the stock markets.
However, they cannot give you the experience required to get the feel of trading and see how it works. Like subjects such as car repair or building computers, trading needs a hands-on approach. Fortunately, some trading colleges offer you the chance to learn by visiting their live trading room for a period such as twelve months of interactive learning.
Learn about trading and beginner trading apps
It’s essential you learn all you can about trading and beginner trading apps. You can begin by opening an account, understanding how the app works and attending hands-on trading courses.