Most adults as they come into their 30’s start thinking more about the long game.
The house, the family, the job, ensuring they have enough money for not only what they want, but more importantly, are they set up for the future they really want.
These 30-somethings are not just talking about retirement, but how to set up their financial future to allow for liquidity, knowing their money is working, growing, and realising dividends.
Here are 5 essential tips on how you can start successfully share trading and building your financial future.
Get an account
The first step on your journey into share trading is to set up a trading account. In setting up an account, don’t simply jump into bed with your bank, remembering that most of the banks have trading platforms, which are convenient in a way, however, often their trading fees are twice or three times of that offered by specialist share trading companies.
In addition, you need to ensure that when you sign up, you look for a company that aims to provide personal service, that will provide you regular information and events and not only that but has a track record of good industry performance and past customer testimonials.
Once you have that trading account, it is now time to get an education. Not only with the platform itself, but also the industry. Explore everything you can on how to buy & sell shares, how to read charts, how to look at options, CFD’s and other financial vehicles that can lead to your short, medium- and long-term prosperity.
Your education is key and it can come in many ways – and needs to. It can come from books, such as Starting Out In Shares – The ASX Way or The Intelligent Investor by Benjamin Graham, you can review blogs and podcasts, but most importantly you can complete courses both online and in-person to ensure you understand the terminology, understand the platform that you are using and comprehend the risks and rewards that trading shares can offer you.
Read and follow the market
Share trading (unlike investing) is all about taking advantage of the movements in the market, it is about seeing companies, shares, markets and industries that are under (or over) valued, then betting on them or against them to move in your favour. To do this, you need to ensure you have all the information possible.
You can do this by keeping up to date with financial news, company news and what the economy is doing from reputable sources such as the Australian Financial Review, or Barefoot Investor.
All of these groups offer a range of free & paid subscription services, reports, information and data for you to ensure that your trades are all informed when you click the mouse to buy and sell.
Go to seminars and take classes
The next step is to build on that knowledge that you gain in the books, news, blogs and reports, but attending seminars and taking classes again, both online and in person.
The more information you can gather, the more perspectives you can listen to and the more ideas you can take in will allow you to better form your own strategies, your own trading ideas and your own expectations of how you are going to approach your share trading future.
Getting a range of strategies, tools, tips and techniques and always looking for new methods is the key to lifelong success in trading.
The #1 investment book The Intelligent Investor by Benjamin Graham is still number 1 and was written in 1949! So good investment strategies are timeless, regardless of the technology we have today.
Start small or use a simulator before you start
Dip your toe in the water. You have set up the platform, attended seminars, courses, read books and you feel confident you understand the strategy you are looking to trade or invest with. You understand your limits and what you need to get in or out of a share.
You can do this one of two ways, you can start with a simulator such as that offer by the ASX, where you can place trades on real companies, and be affected by the movements in the market, the only thing is, its fake money. This will allow you to see if you indeed put real money on the platform, that you would have made or lost money based on the strategy you were employing.
The next step is to get started for real – that is to put small amounts down, small trades and start employing your strategy. This will allow you to review your wins/losses and your strategy, adjusting it if you are not achieving the results you wanted.
At this time, it is always good to have a mentor or an educator guiding not so much where you put your money, but how you do it, what to look for and why.
The time is now…
Where ever you are in your share trading journey, it’s always a great time to read books, download articles or engage in simulators (or real trades) and start building your confidence and acumen for a successful life of share trading.