Signing up for an Internet trading account is fairly simple. Each trading website has its own requirements for accepting you, and some cost money while others are free. Many factors should be considered when deciding to obtain a trading account.
Make sure that you are working through a trusted agent. It is recommended to go through the official stock exchanges such as NYSE or the NASDAQ exchanges, because the companies listed in these exchanges are regulated by the Securities and Exchange Commission (SEC). One of the most important requirements for companies listed on these exchanges is that they are required to file quarterly and annual reports. When you read the reports of stocks that are SEC regulated you will learn about various aspects of a company's overall financial health, and potential for future growth. The healthier that a company's financial status appears to be in the greater the chance that your stock will make a profit. This is not always the case, but most of the time it is true.
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Read all you can about avoiding stock trading scams. Sure, you may be signing up for an agent that says they represent the NYSE, NASDAQ, Over the Counter (OTC) exchanges (legitimate but more risky type of stock exchange), Forex and others. However, you need to make sure that your this agent, usually called a broker, will take the money and apply it to the stock you want to invest in. Another type of trading scam to watch out for is described in the next paragraph.
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Do your homework before considering a too-good-to-be-true investment. If it sounds unbelievable, most likely it is. Some investors take money from current investors and use it to pay off old debts. They hook people in by offering astronomical investment return amounts such as "Earn 40 percent in 7 Days" (a fictitious example), and they expect you to front up large sums of money immediately. It is easy for less experienced investors to become fooled by the attractiveness of an offer such as this.
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Choose one that will offer you the best online exchange tools. You have quite a few options to choose from, some of which cost only about 10.00 per month or less, while others cost hundreds of dollars. The ones that usually cost less are items such as stock screeners and news alerts, which are downloadable. Be careful which products you download, however, because many contain harmful viruses and spyware which are used by hackers to complete illicit activity such as stealing your money stored in an on line account. This does not mean that all free or reduced priced products are harmful, but it does mean that you have to be careful which ones you choose. You can find ratings on which products are safe to download if you search various stock tools review sites.
Tips
Other tools that you can acquire to help you with your on line trading through an Internet trading account are personal finance software products as well as real time electronic trading software. If you want to practice on line trading you can also use simulation software that will help acquaint you with the procedure of online trading.
source : wikihow
