Welcome to Getting Started in the Trading Business! You will learn about general market information, historical market facts, the power of compound interest, setting up a brokerage account, the importance of paper trading, setting up a stock watch list, and the three core rules of the trading business. This module is designed to set the foundation for brand new traders and investors to understand the core basics of trading
This part showcases the four main indexes of the American Stock Market. The four main indices include: Standard & Poors 500, Dow Jones Industrial Average, NASDAQ, and the Russell 2000. Also included in this section are the three types of trends found in the Stock Market which include: Bull Market, Bear Market, and Sideways Market.
This part talks about historical price data of the S&P 500 to give you an idea of what the Market had done on an annual basis over a 33-year time frame. You will gain insight into the 1400% increase in the S&P 500 from 1980-2000, and see how things have changed from 2000-2013. Understanding the Markets change is very important to make sure you understand how to adapt to new market normalities and situations.
This part showcases the main exchanges in the Stock Market where you facilitate orders to buy and sell shares of stock as well as trade option contracts. Some of the most prominent exchanges consist of: New York Stock Exchange (NYSE), American Stock Exchange (AMEX), NASDAQ, and the Chicago Board Options Exchange (CBOE).
Understanding the power of compound interest is a very powerful tool that will help increase your chances for long-term financial independence and wealth creation. Understanding how your money can work for you as a leveraged asset vehicle is one of the most powerful wealth building principles used today.
In order to become a successful stock and options trader you must first have a functional brokerage account. There are several different firms to choose from as well as all different types of accounts to open. Important things to understand are the difference between a margin and non-margin account, commission structure, trading technology, software-based platform availability, and determining the most suitable type of account to open.
Part 6 showcases the importance of paper trading and making sure your brokerage company offers a way for you to trade the markets with simulated money. Paper trading will help build your confidence and familiarity with the trading strategies, the trading platform, and the overall market dynamics.
Stock watch lists are important tools to help organize your overall trading portfolio that also help give insight into how your stocks trade. Having watch lists setup will help keep you more organized with the ability to have segmented watch lists for different sectors, follow favorite stocks, and keep a better grasp on the overall Stock Market.
When you trade the Stock Market like a business it is prudent to follow rules and stay disciplined with your trading approach. This part talks about the three basic trading rules that will help build your foundation and framework to implement future money management rules and become a disciplined trader and investor.