If you are looking to get into the markets, you have to really educate yourself prior to actually risking any money.  Most people are attracted to the markets because they hear of person X making 50% this year, person Y doubled their money on a trade and on and on.  People are not apt to share in the major disasters they have had, and often exaggerate the profits and underestimate the losses when speaking about what they have done.  It is very common to not want to relive a painful moment when speaking to others about your investment decisions.  So before you decide to take the plunge, you will have to figure out what exactly it is that you are tying to accomplish

 

In order to start down your path, you will need to recognize the three methods to get involved with the markets:   short term (minutes to days), swing trade (days to weeks) and long term investing (weeks to years).  Simply discovering which type of trading suits you might seem like an easy task, but it is most likely the most important decision you will make.  You have to match up the trading style with your personality and your level of risk

 

Short term trading is also know as day trading and can strictly be intra-day only or it can entail holding positions overnight as well.  Day trading is probably the riskiest type of trading for most people, and really requires almost a full time effort.  If you have a full time job when the markets are open, this is probably not for you, or only in small batches.   While some people do day trading manually, others prefer the help of a day trading robot to automate things.

 

As opposed to trying to learn day trading, swing trading is a great alternative for most people.  With swing trading the amount of time and concentration required is far less than with day trading, but it will still require you to monitor your positions each evening, and if something is close to a price target or stop area, monitor during the day as well.  Swing trading tries to capture a bigger move in a stock, such as a 5% or 10% or more move in a single direction with limited risk.  Because you are holding for bigger gains and a longer period of time to reach those gains, the amount of actual trading activity is far less than with day trading.  One should keep in mind that while it is less risky than trying to day trade, it is still betting on the short term direction of a stock and by nature is risky in itself.

 

Long term investing is what a majority of the population is comfortable with – buying stocks and holding them.  The only thing that has changed in recent years is the economic climate has changed so that you no longer can just hold something indefinitely and figure you have very little risk.  Many investors have learned a hard lesson when they watched a significant gain turn into a big loss because they just held on.  Every investor these days needs a fixed plan to exit a position rather than hold and hope.