Scribd
Upload
3K views1 page

Trading Basics

Trading involves buying and selling stocks within a single day, which is faster and riskier than long-term investing. Traders must set price targets to take profits and stop losses to limit potential losses before entering a trade. An effective trading strategy includes setting an entry price, price targets to sell portions of shares at profits like 5% or 10%, and a stop loss typically within 2-5% to limit losses if the trade moves against the position. Trading requires practice with paper trading before using real money due to its speed and risk.

Uploaded by

Péter Illés
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
3K views1 page

Trading Basics

Trading involves buying and selling stocks within a single day, which is faster and riskier than long-term investing. Traders must set price targets to take profits and stop losses to limit potential losses before entering a trade. An effective trading strategy includes setting an entry price, price targets to sell portions of shares at profits like 5% or 10%, and a stop loss typically within 2-5% to limit losses if the trade moves against the position. Trading requires practice with paper trading before using real money due to its speed and risk.

Uploaded by

Péter Illés
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

📚TRADING BASICS📚

Trading is the act of buying and selling a stock within the same
day. A trade can last a couple minutes or an entire day. Trading
is much faster and riskier than investing. Before entering a
trade, you must always have preset targets for taking profits
and
stopping losses.

A trade should have a similar layout to something like this.

Entry - Price you entered the stock at

Price Target - Sell some shares (not all) at your first price target. You can sell some shares at
5% profit, then more at 10%, and so on.

Stop Loss - This is needed to limit losses on a trade. Usually stop losses are set at 2-5% for
trades. For example if you entered a trade with $1,000, your maximum loss would be $20
but your profit is unlimited. This is a great strategy all traders should implement.

Trading is more advanced, always start with paper trading or something slower like
investing/swing trading to get the hang of it.

•••

You might also like