Studies show that an average return of the stock market investments is around 7% annually (inflation adjusted). That’s great, but what if you don’t have enough money to invest and make some decent income? There must be a solution. And it exists! Why not become a stock market trader?
How to trade for a profit?
Even if you’ve never purchased a stock or a bond, you must have heard the following advice: buy when it’s low, sell when it’s high. Stock market traders make a profit by buying and selling both shares of well-known companies like Google, Facebook, Amazon and small companies (known as penny stocks).
How do you get started? Buying and selling shares of public companies is possible through brokerage firms.
The most common way for normal people to trade in South Africa is EasyEquities . With EasyEquities you can buy all shares listed on Johannesburg stock exchange, like British American Tobacco, BHP Billiton, Richemont, and others.
You are not only limited to trading shares of companies. There are other assets available, like exchange traded funds (ETFs), futures, options, indexes and others.
Watch the video to learn more about share-trading platforms available in South Africa
Online share-trading platforms allow private investors to handle their own trades. An attractive idea to many investors who like to keep an eye on the market. Various platforms are available to South African traders. Some investors enjoy the near real-time trading, but others complain that these platforms often have time-delays that prevent them from getting the deals that they are after.
Tools and skills needed
You must be a disciplined and able to learn new things. A laptop and a fast internet connection are a requirement. Investors can enter the stock market even without special knowledge, but for traders, it’s important to learn a lot before they buy their first share.
What makes this way to make money different from other ideas we usually cover is that not only can you make money, but you can lose your investments. A lot of traders, it should be recognised, lose their money. But those who can educate and discipline themselves succeed and make some decent and stable income.