Trading Online has never been easier. You don’t need to be an expert to buy or sell stocks, and the costs have been plummeting over the last few years. Although trading platforms will vary between professional and ‘Mum and Dad’ user levels, the introduction of trading apps means anyone can buy or sell from almost anywhere, at anytime, and simply with a swipe of the finger!
I can still remember my first trade. I had moved to Auckland, New Zealand from Australia to take a job as a budding new Technical Analyst. I had been introduced to the world of trading and was being trained as a stock trader. That meant I would look for buying opportunities in stocks with an expectation that the share prices would rise. My focus was the New Zealand and Australian stock exchanges.
A decision had been made on a New Zealand stock that I had participated in the analysis of. It was one of the Fletcher companies, and I figured there was no time like the present to make my first trade. My account had already been opened and funded, so all I had to do was phone my broker.
Now, I’ve done quite a few ‘extreme’ things in my brief lifetime. An early career in the military only touches on some of the exhilarating things I have done (thankfully, that doesn’t include being deployed into a conflict). But making my first trade was more nerve-racking than tactically flying in a Huey Iroquois helicopter amongst the tree tops.
Never before have I been more articulate in my pronunciation of the English language. I had written down my exact order, checked it, checked it again, and checked it at least another 5 times before I picked up the telephone with my sweaty palm. And although I had dialled the brokers’ number numerous times before, my focus on hitting the correct keys on the telephone was so intense that all other noises and my surroundings disappeared in the background.
As my broker clicked onto the line at the other end, it felt like I had an outer body experience, watching myself as I placed the order. After a very quick hello, I proceeded to place my order. After the broker repeated the order back to me, I could hear in his voice a little chuckle as he said “this is your first personal trade, isn’t it?”
That trade was nearly 15 years ago, and I have placed literally tens of thousands of trades since then. And as I sit in front of my trading platform with orders set and ready in the markets, I look back fondly at my apprehension and fear over placing a mere $500 order in the markets, over the phone to a broker.
In September last year, I was travelling in Waikiki, Hawaii and was placing orders via my Apple iPad. Then in November I was in the Cook Islands placing trades and checking the markets from a cafe in Rarotonga (it was one of the few spots I could get a clear internet connection). I didn’t even have to take my laptop on either trip.
Many of my new clients are extremely nervous when it comes to placing their first trades. And although I will assure them that this is the simplest of tasks that they will undertake in their career as traders, I know it does little to appease their fears.
The greatest fear we have as traders is that we get it wrong. If I got it wrong with my first $500 trade, does that mean the end of my trading career? Thankfully, it wasn’t. But all too often I see people walking away from the markets after just one or two trades. Either successful or unsuccessful.
Fearing the process of placing an order is not about clicking the button or swiping the finger over an app. It is about getting the trade wrong. For this reason, we recommend making your first few trades very small. Remember, you’re not going to retire on one trade, and your goal should be to consistently trade over a number of years, not just for one day.
Trading online has simplified the process of buying and selling. The platform itself is merely a tool for you to accomplish the function of trading. Most online platforms provide demonstration accounts for you to practice in, and various videos showing you how to use the functions you require. And if after all of that you are still confused, you are likely to have a support number you can call.
Nowadays I literally place orders in my sleep as it is a simple function of what I do. The decision making process on whether to buy or sell is where my energies are focussed as this is what will make me a successful trader.
And just like any other popular App that you might download as a game, for music or any other function, trading apps are a simple means for you to place orders to buy and sell. At the same time, they are cheaper and less emotional than speaking with a broker over the phone.
So take the time to practice and play around with your online trading platform and make sure you are familiar with the process before you make the decision to buy or sell. At least then the only worry you will have is the trade itself, and not if you have placed the order correctly.
US Stocks & Options Client Advisor
Halifax Investment Services
ASIC Australian Financial Services License Number – 225973
Matt Brown is a US Stocks and Options client advisor with Halifax Investment Services. He is an Authorised Representative of Halifax Investment Services with qualifications to provide General Advice in Derivatives and Stocks. He has worked in the Financial Industry since 1998, is a qualified Technical Analyst and has Accreditation as a Derivatives Advisor Level 1 & 2.