What is trading?

The trading concept is one of the most popular stock investment methods. It has quite peculiar operations, which allows obtaining many small profits on a constant basis, but it can also lead to a series of losses as a result of errors in planning or strategies.

The meaning of trading on the stock market implies the negotiation or speculation with the purchase and sale of shares, but also of other financial products with the purpose of obtaining in a very short period of time important profitability. Contrary to what a normal investment implies, in trading some periods of time of days, hours or even minutes are handled with the aim of taking advantage of the very small differences in the prices of the listed securities. In this way it will be possible to achieve a quick return in exchange for assuming very high risks.

It is possible to use the investment via trading in different financial assets such as stocks, currencies, commodities, etc.

¿ Cómo operar vía trading?

To carry out operations via trading it is only necessary to open a securities account in a bróker or legally authorized intermediary, which can be a bank or financial entity, where the investment-oriented money will be deposited. Then, by means of a computer it will be possible to operate in trading by sending the different buy-sell orders to the market with the intermediation of the broker.

To succeed with trading you have to follow a series of indications:

  • Have a planned strategy: the market entry and exit points must be defined in advance. The methods may change depending on the operating modes.
  • Intraday trading: opening and closing positions in the session of the bag, but carrying out few operations.
  • Swing trading: carry out operations for several days in order to achieve bearish or bullish trends to have more options for success.
  • Control risk: it is advisable not to lose more than 3% in each operation via trading.

How does trading work?

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