Trading on the exchange attracts many. The popularity of this type of earnings is explained by the fact that exchange speculators are able to make a fortune in a matter of minutes. Unlimited financial opportunities, excitement and constant adrenaline push many to start trading. Even the fact that from a winner with a millionth deposit can just as quickly turn into a bankrupt is not scary.
The trader’s work is shrouded in secrets and scandals for the simple reason that the majority of those who come to the market with the aim of enriching themselves are left with nothing, and only a few can make money from the air. In addition, most people do not understand how to make money on the exchange, sitting in front of a computer screen and not really doing anything.
What is a stock exchange?
Exchanges arose a very long time ago, back in the 15th century. Initially, these were territories for conducting bill trading among merchants. Unlike modern computerized platforms that allow you to earn money on the Internet on the stock exchange, transactions were carried out verbally through negotiations between participants.
Now trading on exchanges is regulated by the charter and the state, and trading takes place according to certain rules. All disputes are resolved through arbitration (the body for the settlement of disputes). Exchanges provide customers with quotes, a place for trading, provide information services and guarantee the fulfillment of all obligations by market participants.
Depending on what instruments are traded on exchanges, they are divided into stock, currency, commodity, options and futures. But there are universal trading floors where you can speculate with any of the listed assets. Therefore, in order to understand how to make money on the exchange, you need to choose one of the areas, and then proceed to training.
Stock Exchange
Stock exchanges are trading in securities: stocks and bonds. In the world there are more than two hundred. In some countries, there is a monocentric exchange system, in which one exchange dominates, located in the financial center. All provincial trading floors lack independence and obey it. A similar example is the London Stock Exchange. The polycentric system involves the operation of several large exchanges in the country (such an order in Germany, Australia).
Before you make money on the stock exchange, you need to study the theoretical material on fundamental and technical analysis. In addition, you should pay attention to money management and the psychology of trading, otherwise excess lots and greed can quickly reset the account, not even giving the opportunity to start a trader's career. After mastering the theoretical part, you can proceed to the next step - conclude a contract with a broker and open an account. As a rule, TRANSAQ or Quik trading platforms are offered for trading on the stock market.
Forex Currency Exchange
How to earn extra money for pocket money, vacation abroad or even a new car? The answer to this question can be found in bright advertisements about trading on the Forex market. Super-profitable strategies, advisors or indicators promise to help become a millionaire in seconds. And the stories from the life of successful traders tell about how to make money on the Forex exchange without a special education or huge start-up capital.
What it is?
Foreign exchange operations are carried out on "Forex" (from the English "forex", or "foreign exchange" - currency exchange) - this is an interbank currency exchange market with free quotes.In the post-Soviet space, the term "forex" means speculative currency trading through Internet terminals. Intermediaries are dealing centers and brokers. And market participants who make trading operations to generate quick profits are traders. Those people who buy or sell currency in the long term are investors.
Many are interested in how to make money on the exchange. Naturally, like any occupation, trading in the Forex market requires investments, both financial and temporary. Many people take years to learn trading and more than one lost deposit. Studying the theory and practical application of one’s knowledge does not always give quick results.
Therefore, experienced traders are advised not to rush into opening a real account, since many beginners lose their money very quickly in the first months of exploring the market. Therefore, if the question of how to make money on the exchange is very serious for you, it is better to use the basic rules of exchange trading, which all the most successful speculators write and tell about.
Market analysis. From theory to practice
First of all, you need to learn how to analyze the market and be able to understand the reviews and forecasts of experienced traders and analysts. For beginners who are not yet guided in how to make money on the exchange, but want to combine training and earning, there are "paid signals". Traders with experience and with profitable trading systems will share their market entry points and forecasts for a certain amount of money, which you will transfer to them for tips.
But in any case, learning to analyze the market is necessary. Each trader must choose or develop his own trading system that will be comfortable and compatible with his temperament, deposit size and work schedule. Most market participants opt for technical analysis. It is suitable for speculative transactions, as it allows you to work with any time intervals from M1 to W. Fundamental analysis is more focused on long-term investments. With it, you can work by devoting only a few hours a week to trading, if the trader has a large deposit at his disposal.
Money Management. How to manage risks on the stock exchange?
One of the key rules for successful trading is risk management. It is impossible to open transactions with too large lots, because trading on the exchange is based on probability. No one knows one hundred percent where the price will go at one time or another, so no more than 2% of your deposit can be involved in each transaction.
Compliance with money management and the obligatory use of stop-loss (limit of losses) will not allow you to lose all the money, even if a series of losing trades comes. And the most important thing for a trader is to be in the game. At any moment, there may be an opportunity or a hint from the chart on how to make money on the exchange, but if the trader has lost all his capital, he will not be able to take this chance.
Everyone knows that any business is a risk. Experts say that most enterprises go bankrupt in their first year of operation. Even more frightening are the disappointing statistics that nine out of ten startups burn out before they have time to make themselves known in the business world. But, nevertheless, ambitious entrepreneurs continue to cherish the thought of their business, as they understand that with ten attempts, one, according to statistics, will bring a profit that will cover all previous losses and expenses.
Why, then, is market trading considered a high-risk type of business? Many people are afraid that 95% of traders lose money, and only 5% begin to understand how to make money on the exchange. Professional traders are really not afraid of losses, because they understand: strictly following their strategy, they will wait for those large winning transactions that compensate for all their losses with interest.
Trend is the best friend of the trader
Exchange traders use a wide variety of strategies that sometimes give completely contradictory signals. But they have not yet come up with a more reliable and efficient system than trend trading. Is it possible to make money on the exchange using only trend movements? The well-known proverb "Trend is your friend" ("Trend is your friend!") Gives a hint that you can, especially if you focus on trends from higher timeframes. One of the important axioms of exchange trading is following trends. Their search often causes difficulties for beginners, but a variety of indicators and oscillators will help to deal with the dominant direction of prices.
On the charts of trading instruments, upward and downward trends, as well as flat, are distinguished. Often, in order to visualize the direction of movement, draw trend lines. A trend line is drawn through the ascending troughs for an uptrend, and through downward peaks, respectively, for a downtrend. Several opposite trends may exist on the market at the same time (depending on the analyzed time period). Trend line simultaneously acts as support or resistance for the price. If a breakthrough occurs, you should be careful, as a trend change is possible.
Trading in trending markets is much easier than in flat, when the price is unpredictable and draws zigzags, fending off the conditional boundaries of the corridor. To make money, the trader should wait for the correction and open an order in the direction of the main movement. In most cases, the trend will continue, even if the rollback is delayed a little or provokes a "drawdown" on the deposit. For beginner traders, higher timeframes, such as H1, H4 and D1, are more suitable. At small time intervals, trends can change several times a day, and it will still be difficult for inexperienced speculators to see the strength of new impulses, especially after the release of news or important market data.
Bonus to the account, or How to start trading on the stock exchange without investments
Many brokers offer beginners fairly favorable trading conditions.
First of all, each inexperienced trader can conduct their training on a demo account, which is no different from the present, but allows you not to lose the first deposit in the process of developing your skills and conducting trading experiments.
Although more experienced traders claim that trading for real money is fundamentally different from virtual transactions, therefore, in order to feel all the emotions that flash during the work, you need to lose and earn real amounts.
Brokers took into account this moment of trading, offering no deposit bonuses or an initial cent deposit for those who are afraid or do not want to lose their savings. Using this option, traders not only have the opportunity to familiarize themselves with the rules of the market and hone their skills, but also manage to make money on the exchange without investments.
Competitions and tournaments for traders are another way to start a career without your own funds. But in this case, you must be either a professional or a lucky one to increase your starting capital and defeat your rivals. Prize deposits in such competitions can reach several thousand dollars, but the struggle for first place is not easy. Sometimes the prize in the competition is not the amount for the deposit, but capital for management. This means that the trader will trade with investor money and receive a percentage of the profits.
Is it possible to become a millionaire by working on the stock exchange?
Whatever specialty we choose, in addition to emotional satisfaction, it should bring income. Therefore, it is not at all surprising that novice traders are wondering how much professionals earn on the exchange. Before investing their time and money in a future profession, they want to know how their efforts will be rewarded. Is it possible to secure a cloudless life by working at home in comfortable conditions?
Theoretically, the exchange provides unlimited opportunities for profit. Everyone can earn money at any time, day or night, while exchange platforms are open. But for some reason not everyone succeeds. Traders' earnings depend on several factors. The most important ones are the size of the deposit, the trading system, the type of trading (investment, scalping, medium-term trading). It is very difficult to earn a million with a deposit of a thousand dollars, just like it is almost impossible to secure a comfortable life, having a hundred dollars on your account. Although one-time large wins happen to many, but you should not rely on them.
There is nothing surprising in the fact that some speculators can double their deposit in a few days - everyone has luck. But, most likely, newcomers are more interested in stable and regular income in this field of activity. And he, according to many experienced reviews, is not so tall. Naturally, traders do not shout about their profits, afraid to give out a secret about how much they can earn on the exchange, since everyone knows that "money loves silence." There is always fear that market conditions will change or the trading system will cease to bring regular profits. But average indicators can vary from 30 to 100% per annum. Of course, some scalpers or day traders show better results.
Robots and algorithmic trading
Many modern traders no longer trade manually; they entrusted this task to trading robots. Technological progress first transferred market participants from trading pits to comfortable home offices, where they can carry out trading operations in a housecoat. Now, even the presence of the trader during the trading is not necessary - the robot will do everything.
Algorithmic trading is used as private investors both banks and hedge funds. To create a trading robot, you need an algorithm that processes the data received from the exchange. Based on the analysis of this information, he makes a decision and makes transactions. To create an elementary robot, it is not necessary to be an IT specialist, but complex strategies are implemented with the help of entire teams of professional programmers and mathematicians.
Trading robots is another way to make money on the exchange. They do not create large trading movements in the market, but only react to the prevailing conditions, earning frequency deals, where the profit depends on the number of orders and the speed of response. Despite the fact that each such algorithm has a risk management system, it is necessary to constantly optimize it, based on the changing market conditions. Be sure to watch the robot person.
If we consider trading as the main type of earnings, then stable results can be achieved after one or two years of hard work, if you have not left the thought of how to make money on the exchange during this period. Reviews about speculative trading are very diverse. The exchange takes everything away from some, while it gives others the opportunity to snatch their money. But those traders who have learned to earn money stably will no longer exchange free swimming and high income for daily work-days and submission to their boss. We can say with confidence that making money on the exchange is worth the time and money spent on it. Even if a person does not become a professional trader, his worldview changes dramatically and his eyes open to many things!
