The stocks and shares market never gets any easier to navigate. In many instances, it can be a daily battle, but before you go to war each week it is important that you arm yourself with the right information in order to be successful. The following share trading tips will serve you well during the week ahead.
Never place market orders before trading begins
You may have heard plenty of share trading tips over the years, with a popular one being that it is good to get in early. In some instances that might be true, but there is such a thing a too early. Strange things can occur when the opening bell rings and within moments the landscape of the market can change. Issuing a market order too early can leave you at risk of becoming victim to such, especially if you are someone who likes pile orders on top of each other. If you feel you must place market orders early, then always make sure you are adequately protected with a suitable limit order.
Understand the best time to trade
Determining when the best time to trade is has never been easy, largely as such changes so regularly. But, in reality it can be worked out to be between 1pm and 2:30pm. This is because the country has had a chance to register the business news of the day by that point. While important political news, some of which can have an impact on market movements are announced in the morning hours along with corporate earnings reports. This is one of the smaller share trading tips, but one that definitely bears thinking about.
Be sure of both bid size and ask size
When it comes to share trading tips, the following requires the most diligence to execute correctly. The best real-time quote system should tell you not only the last recorded price of the stock you wish to buy, but also the ask price and the bid price associated with it. Some may also include figures related to the amount of stock currently being bid for. When the bid size is larger than you expect, then it can be taken as a sign of their being an underlying demand, so be wary of holding out any longer in such case. The flip side of this is that if there is a large position in terms of ask, then it will show that there are many sellers looking to get out. Read both bid and ask sizes and do your best not to hesitate when it comes to initiating a trade.
Shares of $10 of more are where the action is
It may seem obvious, but here is an explanation as to why you should focus your attention on stocks that are $10 (or country equivalent) and up. Stocks that come under this figure are usually quoted for lager percentage spreads, meaning that you need a big price increase just to break even in some instances. Companies with low-priced stock are that way for a reason; they are usually prone to financial trouble from even small setbacks. The only expectation to share trading by this rule would be when it comes to closed-end funds. This is because management will want the share price of such to appear affordable and entice small investors. Stocks of $10 or less are usually battling against the odds; it pays to remember this when thinking about effective share trading tips.
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.