SEPT 23: Looking For Online Stock Trading Information?

by David Jenyns on September 23, 2006

As an online investor trader you are used to instant access to your account and near instantaneous executions of your trades, so you need to understand how you can protect yourself in fast-moving markets. Information is your best protection, it is crucial to keep up to date with what is going on in the industry.

Online Investing

From more than 100 online brokers you can easily buy and sell stocks with just a click of mouse. Even if online trading saves you money and time you still have to make investment decisions which take time, so it is vital, that prior to making your trading decisions, you have the right online stock trading information available to you, because if you donít, you can end up losing your capital.

Set Your Price Limits

There is plenty of false online stock trading information, but it is a fact, and a cardinal rule of trading that you should avoid selling or buying a stock at a price lower or higher price than you wanted, you have to place a limit order, which is an order to sell or buy a security at a specific price. A sell limit order can be filled at the limit price or higher, and a buy limit order can be filled at the limit price or lower. So, if you want to be able to control the price of your order you should place a limit order not a market order (simple yes, but could mean the difference between making, and losing money).

If before your order is filled the market price quickly surpasses your limit, your limit order may not be executed, but you can protect yourself from buying at too high a price by using a limit order. No one ever lost money on a trade they didnít do.

Choke Points

You may think that technological choke points can prevent or slow your orders from reaching an online firm, but problems can occur when your computer, modem or Internet Service Provider is faulty or slow, when a broker-dealerís Internet Service Provider is delayed or slow or it has inadequate hardware, or when Internet traffic is heavy and is slowing down overall usage.

The problem is that the flow of online stock trading information in regards to your trades, can be caused by a limitation or capacity problem at any of these choke points.

Options for Placing a Trade

You may have alternatives for placing trades such as faxing your order, touch-tone telephone trades, or talking to a broker over the phone, so you should whether using these options may increase your costs.

This online stock trading information should help you improve your activity and make you check all the alternatives before you place your order. Be very careful, you can win a lot but also loose!

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