5 Steps to Getting Started with Online Investing
Whoever told you that getting started with stocks won’t work for you because stocks aren’t accessible is a liar — or, at least, very misinformed.
Another common investment myth is that you will need a professional broker — whelp, also busted. You can do it on your own: you simply need a good platform, access to successful traders whom you can copy, and a small amount of cash to get started.
While it can take time to reap the benefits of smart investing, breaking into the practice takes five simple steps.
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Step 1: Identify where you should invest and where you shouldn’t
The first step in investing is deciding how much money you should invest. Before getting started, make sure you have a handle on the following:
- The total of your monthly expenses, including housing, food and amenities
- Do you have savings that will allow you to account for these expenses in the wake of a sudden change in income?
- Do you have additional funds to spare after these expenses?
If the answer to the last two questions is “yes,” it is up to you to decide how much of these additional funds you would like to allocate to your stock portfolio.
Next up is an assessment of where you would like to invest. Ask yourself:
- Are there particular industries that align with your moral compass?
- Are there certain public companies in whose success you have faith?
- Are there any trending stocks that you would like to test for yourself?
- Where have other successful stock traders seen success?
Once you have a starting budget and a list of potential stocks that appeal to you, it is a matter of aligning the two to meet your goals. Which stocks on your list have the most potential for growth at the right prices for you? Those are good potential starters.
Step 2: Pick your platform of choice — one that gives you full control without fund manager fees.
There are two paths you can take when it comes to building a stock portfolio — you can choose a platform that allows you to do it yourself, without paying brokers’ fees, or you can pay a broker to invest on your behalf.
By copying the stock portfolios of successful investors, you can have confidence in your portfolio without the added fees paid to a broker.
Step 3: Copy the stock portfolios of successful investors
While you should always strive to educate yourself about the industries and companies behind the stocks in which you invest, copying a successful investor will allow you to break into stock trading more quickly.
Our trading platform has a unique feature that allows investors transparent and direct access to successful stock trader portfolios. You can see exactly which stocks were purchased as well as their allocations.
When considering which portfolios to copy, you will want to take the following into account:
- How risky are they? Do you want to be that risky too?
- Over which time frame do they expect to see results?
- Do they trade the type of assets with which you are comfortable?
- Have they seen success?
It is important to note that while it may be a helpful guide in your selection process, past performance is not an indication of future results. Choose someone whose judgement you value, as well as someone whose portfolio you are confident about copying.
Step 4: Invest your funds and track your potential for growth automatically
Once you have copied a successful investor portfolio, you are off and running. Alongside initial research, it is important to keep an eye on your stock portfolio and stay informed about the health of each of your stocks.
One option is to aggressively check the news, stock tickers and platforms to make sure you never miss a beat. Another is to set notifications that alert you to changes in your stock’s price, so that you are informed the second activity occurs.
Our trading platform allows you to set notifications based on stock price, communications from investors you have copied, and more, so you stay on top of changes in your portfolio.
Step 5: To stay successful, consistently interact with other investors locally
There are a lot of resources out there with information to support you, but a big part of the education process is learning from others.
Keep in touch with other investors in your town, city or country to discuss local trends and strategies that are related to you, in your local language.
Not only will these help you boost your education, but also to grow a community of support where you can ask questions, provide tips and help each other find success.
Our platform has a community feature that allows our investors to stay connected with each other as well as with the successful stock traders whose portfolios are available to copy. Exchange ideas and strategies with other traders and stay on top of your game using our social tools.
Online stock trading does not have to feel daunting. With the right tools — including the right budget, platform, professional, tracking strategy and community — you can get started today.
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5 Steps to Getting Started with Online Investing from eToro.