What is online trading?

Remember, online trading can be risky. You may not get back your original investment when trading in the financial markets. When using leverage, you may lose more than your initial investment.

With the progression that has been made in technology over the last three decades, has come the advancement in how companies and industries operate, and one industry that has benefited hugely from mankind’s technological advancements is the online trading industry.

Previously if an independent investor or trader wanted to place a trade, they would need to call their broker, who would then place the trade into a system that relayed the information to the trading floor or exchanges, at which point the trades would be handled by traders on the floor. During this way of trading, traders and investors effectively relinquished control of their funds by leaving it in the hands of traders and runners meaning that information, and subsequently funds, could easily be lost in translation because a simple trade had to pass through so many different avenues in order to get executed. Traders and investors were also only able to have access to their trades and their accounts during the opening hours of the markets, so if a trader or investor wanted to check how their overnight trades were doing, or wanted to add or withdraw funds from their account, they would only be able to do so when the markets were open.

With the development of technology and more specifically the internet, online trading has become the primary form of trading in the financial market. Most companies now offer all of their clients the opportunity to trade online and have online trading platforms so that traders and investors can trade independently and without the need of a physical trader to execute and close trades for them.

Online trading gives independent traders and investors the opportunity to effectively become their own personal trader. By signing up with companies that offer online trading platforms, traders and investors are given access to constantly updating market prices, full access to the markets, news updates about anything significant that has occurred in the market, as well the ability to open, close and tailor their trades.

 

Risk warning: Spreadbetting, CFD trading and Forex are leveraged. This means they can result in losses exceeding your original deposit. Ensure you understand the risks, seek independent financial advice if necessary. The value of shares and the income from them may go down as well as up. Nothing on this website constitutes a solicitation or recommendation to enter into any security or investment.

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