Play the Stock Market: how to start Trading Online
Published: 18 November 2020 by Andrew
What does it mean to Play the Stock Market? The word play could deceive someone, but the stock market is by no means a game. Everyone knows that the stock market is a market where the shares of companies are listed.
The value of these shares changes continuously over time, taking into account the earnings prospects of the company itself. This guide explains in detail how to play the stock market and how to get the best profits, avoiding mistakes and rip-offs.
How to Play the Stock Market
Playing the stock market means using these price changes intelligently to generate profits. In practice, playing the market means trading online on stocks (or even on indices like NASDAQ).
Beginners often think that playing the stock market consists of buying stocks when the price is low and reselling them when the price rises, making a profit. It is clear that this is a way to play the stock market, but it is not the only one: there are also other earning opportunities that we will now examine in detail.
First of all, it should be remembered that to play the stock market you need the support of an online trading platform. It is possible to connect to the best trading platforms directly with a computer or mobile phone connected to the internet.
In recent years, online trading platforms have become really easy to use even for a beginner. There are trading platforms that are safe and reliable and others that are less so (it is obvious that we recommend working only with safe platforms).
Once we open an account on a trading platform, we have the option to buy stocks. The best platforms (the ones we recommend using) also allow you to carry out another online trading operation: Short Selling.
Short selling is a speculative operation that generates a profit when the price of a financial security falls. In practice, those who operate with the appropriate online trading platform have the opportunity to make money both when the share price rises and when it falls.
This is a smart way to play the stock market! Many beginners start playing the market and don’t even know about this opportunity. Even worse, some start with an inadequate trading platform and seriously risk losing money.
Trading Platform to play the Stock Market
But how should a good platform be made to play the market? We have already mentioned that it must be safe and reliable. To have this certainty, it is sufficient to rely exclusively on authorized and regulated platforms.
In this case, the European supervisory authorities (like CONSOB and CySec) watch over the money invested and ensure compliance with the very strict EU legislation to protect investments.
A good online trading platform to play the stock market, however, must not only be safe: those who start playing the market do it because they want to make money!
For this reason it is really important that a good platform is also completely free and without commissions, especially if you want to do online trading with small amounts.
There are safe and reliable platforms that apply a fixed commission of 7 euros to each operation. If I start with a capital of 100 euros, in less than 15 operations you will have completely burned your initial capital, even if the operations close at a profit. It is useless!
The most savvy traders, on the other hand, play the stock market with platforms that do not charge commissions and are enormously cheaper. These platforms make only a small profit from each trade in the form of a tiny difference (called the spread) between the price at which a stock can be bought and the price at which it can be sold. This system is much more convenient for the trader.
It is also important to operate with trading platforms that are easy to use. Furthermore, some platforms offer additional services that are extremely useful for playing successfully the market. Below we present the reviews of the best trading platforms to invest in the stock market.
Min. Deposit: 50€
Min. Deposit: 100€
Min. Deposit: 50€
Min. Deposit: 250€
Min. Deposit: 100€
72.30% of retail CFD accounts lose money
Min. Deposit: 250€
eToro is an excellent alternative to start trading on the Stock Exchange. In addition to being completely free, simple and intuitive, eToro is also a real social network for investors.
Thanks to eToro it is possible to get in touch with other investors, exchange opinions on the markets and, above all, it is possible to automatically copy what the best investors (called Popular Investors) do.
Beginners, therefore, sign up for eToro above all with the aim of automated trading. They then use the efficient internal search engine to find the investors who have earned the most in the past and automatically replicate all their operations with the patented copytrading system.
By copying the best, they also have the advantage of being able to learn to play the stock market by observing what great investors do!You can sign up for free on eToro by clicking here
ForexTB is the preferred option for those who start playing the stock market from scratch. Why? Because it offers a really simple and intuitive interface. However, this simple interface is not the only reason that pushes so many beginners to play the stock market with ForexTB.
One of the main advantages of this platform is the possibility of being helped, directly on the phone, by a real trading expert who provides valuable advice for those who start and do not want to make mistakes.
Anyone who wants can also download a free guide to the Stock Exchange. This guide is very popular (more than 100,000 downloads in less than a year) because it does not waste time with theory but offers a simple, clear and practical path for those who want to start earning with the stock market. You can download the ForexTB ebook for free by clicking here.
ForexTB is completely free and does not charge any type of commission. Anyone who wants can use the excellent demo to play virtually the stock market, that is, use virtual money to invest in stocks and then experiment without any kind of risk.You can sign up for free on ForexTB by clicking here
Iq Option is an ideal choice for trading on the stock exchange when you have very little capital. It is the only platform, in fact, that allows you to start with an initial capital of just 10 euros. Other platforms usually require 250 euros (which is a small amount anyway) but Iq Option asks very little. There is no platform that requires a lower minimum deposit.
Obviously, those who choose to operate in demo mode do not have to make any deposit: the Iq Option demo is absolutely unlimited, free and without restrictions.
Iq Option provides a particularly intuitive interface, perfect even for those who have never played on the stock market. Furthermore, all subscribers have hundreds of video courses available that explain in detail how online trading works, starting from the basics up to the most complex strategies.You can sign up on Iq Option by clicking here
Is it worth playing the market?
At this point it is important to answer the question of many novice traders: is it worth playing the stock market?
There is no answer to this question. The fact is that it all depends on the platform you use and how you trade with it.
To understand it, playing on the stock market is absolutely not convenient if you operate with a platform that is not safe and reliable (you risk scam) or that applies trading fees (you risk seeing the capital evaporate by dint of paying commissions).
The way in which we operate is also very important: no financial asset is destined to grow forever, not even the best shares. This means that those who only buy shares will lose money sooner or later.
On the other hand, those who buy or sell short depending on market conditions can achieve exceptional results.
As we have already said, unfortunately many novice traders do not even know that you can short sell a stock to profit from the price drop. This means that, for these people, trading online on the stock market is almost never worthwhile.
Studying a good online trading course is therefore essential for those who want to achieve good results.
Play the Market, opinions
What are the most common opinions on playing the stock market? It must be said that unfortunately many people are deceived by this expression: we would prefer to say investing in the stock market or trading online on the stock market. The phrase playing the stock market has now entered common use (it has been used for decades) and therefore we continue to use it. What is clear, however, is that the stock market is absolutely not a game.
There are people who think of the stock market as a game to make easy money or as a kind of gambling. This opinion on the stock market is very dangerous.
The stock market is not a game of chance at all: those who believe that the stock market is a kind of gambling tends to operate almost randomly, making bets on the performance of shares rather than using technical analysis or fundamental analysis tools predict the performance of stocks on the stock exchange
Which then, to be honest, you don’t even need to become expert trader in technical or fundamental analysis because it is always possible, for example, to copy the stock market operations of the best investors thanks to eToro or you can operate from scratch by following the valuable advice that is provided from the ForexTB expert.
What must be clear, however, is that the stock market is not a game: those who play on the stock market making random bets and hoping to win money, lose in the long run.
Stock Market and scams
A not very widespread opinion (but still present) indicates the stock exchange as a sort of legalized scam. Why does this opinion exist?
First of all, it is good to clarify that the stock market is absolutely not a scam, on the contrary: we have seen that playing the stock market can be an investment with high returns.
It is also true, however, that there are scammers who promise high earnings to attract the most naïve and then make the invested capital disappear. For example, at the moment a scam is running on the internet that promises very high earnings thanks to the investment in Amazon shares but in reality completely robs those who fall into the trap of capital.
How do you avoid these scams? The safest way to avoid scams is to operate exclusively with authorized and regulated investment platforms.
These platforms allow you to do online trading on the stock exchange absolutely without risk because they are subject to the supervision of the European supervisory authorities.
These supervisor authorities have the task of protecting investors and their capital and therefore supervises the behavior of the authorized platforms.
Unauthorized platforms, on the other hand, completely escape the control of the supervisors and can therefore scam their customers (usually they do).
The authorities, in these cases, warn savers about scams. They also issue cessation orders for these trading platforms but since these platforms are usually based outside Europe, these orders are never fulfilled.
Losing money in the stock market
Is it true that the stock market is risky? Can you lose money by playing on the stock market or on stock market indices? Before starting to analyze this question in depth, it is good to make a premise: any financial investment is risky.
Only the money deposited in the current account (and only up to 100,000 euros) is under the state guarantee. Current accounts now have a negative return, that is, you pay for the bank to keep them.
Other investments always have some degree of risk. The return that can be obtained is in some way related to risk. To say, current accounts have a negative yield, government bonds from more solid countries have zero (or in some cases negative) returns while government bonds from less solid countries can have high returns.
As for investing in the stock market, it is obvious that there are individual transactions in which money can be lost but for traders this is not a problem.
Why? First of all, those who work with the best platforms have the possibility to set a stop loss, that is to specify for each operation what is the maximum loss they are willing to run.
Secondly, it is always advisable to apply a correct money management strategy when playing on the stock market. It is not difficult: it is enough to divide the total capital allocated to the Stock Exchange into small amounts and invest only a small amount in each operation.
In this case, even if an operation closes at a loss (and it can happen because no one has a crystal ball and predict all the operations with certainty) the losses are more than offset by the profits generated by the other operations.
For those who operate on the stock market with this simple money management strategy (and perhaps even setting stop losses), losing money on a single operation is not a tragedy, usually it is a small (or very small) amount of money.
On the other hand, for those who invest all their capital in a single operation and perhaps without even setting a stop loss, the losses can be catastrophic.
Why you lose money on the stock market
We can therefore summarize by saying that losing money on a single trade is normal because no one can predict with absolute certainty whether a stock will go up or down. Those who operate by setting stop losses and doing Money Management, in any case, put a limit on these potential losses.
Those who do not know at least the basics of investing in the stock market usually operate without setting stop losses and without money management. A single trade closed at a loss can turn into a tragedy.
To lose money on the stock market, therefore, are those who do not have the adequate preparation, people who think that the stock market is a game and that you don’t have to study before starting trading. Stock exchange trading is not a game (even if it is not difficult either)!
For this reason, we recommend learning the Stock Exchange with serious courses, or with eToro, for example avoiding wasting time reading the Stock Exchange forum posts (which are useless and harmful).
Obviously, you lose money on the stock market even when you suffer scams: we have already explained how to avoid scams on the stock market!
Play the Stock Market simulation
We have already mentioned that the best investment platforms allow you to play the stock market virtually, thanks to demos.
It is right to say a few words on this very important topic. A demo platform is identical in all respects to a real investment platform but differs in one fundamental aspect: the money invested is not real but virtual.
This implies that it is possible to experiment with techniques and strategies to play the stock market without risking absolutely anything.
Many beginners are thus able to easily accumulate valuable experience in order to then be able to operate (without errors) with real money.
Obviously, these stock market simulations cannot teach everything: for example, they do not teach how to manage one’s emotions when trading.
Fear and greed, in fact, must be kept under control when operating on the markets. With the stock market simulation, obviously, the emotional aspect is not present and therefore you only learn (well) the technical aspect.
In any case, considering that most of those who start playing the stock exchange do so with a capital between 10 and 250 euros, the problem is not that serious. And with a little real experience, you can also perfectly learn to manage emotions.
Read more about Demo accounts in our full article.
Stock Market Trading: guide to the success
Before concluding, let’s make a summary of the elements to achieve success with stock trading.
The first element is definitely the choice of an authorized and regulated trading platform. Only a secure platform can guarantee not to be scammed.
The second fundamental point for trading the stock market is preparation: the stock market is not a game (even if improperly we talk about playing the stock market) but it is not difficult to learn either.
All it takes is a good course (the ForexTB course is great, and it's free) and a little commitment.
Trading in demo mode to experiment before investing real money is also a good idea.
Playing the stock market is not a game at all but it is a high-yield speculative investment that can generate very high profits, as long as you use safe and commission-free platforms such as ForexTB and make a serious commitment.
To make money it takes a good basic preparation that can be acquired even by beginners (there are excellent free guides like this one), it takes time and effort.
Playing the stock market is not a way to make easy money: those who promise easy money are usually a scammer and those who follow this chimera are destined to lose money rather than make it.
The expression is improper, it would be more correct to speak of stock market trading or investment in the stock market. In any case, playing the stock market means making a profit when the prices of listed shares rise or fall.
Not today, it is not difficult to play the stock market. The platforms are super easy to use (even for beginners) and there are great free courses. With a little commitment and a little time, great results can be achieved. Indeed, it is possible to automatically copy with eToro what the best stock market traders do.
Yes, but you need to know how to do and use the best stock market trading platforms.
Zero if you have the intelligence to operate with the best stock market apps that do not charge any fees.