Do you want to start an online trading business that has the potential to turn into a full-time career? If so, it’s important to be aware of some of the pitfalls that many newcomers to the field encounter. Everyone makes mistakes, but it helps to know the most common hurdles for the average online marketer ahead of time.
Most importantly, you should do an honest skills assessment to make sure you have or can acquire the traits needed to be successful. The good news is that if you care about markets and love doing business, you’re already halfway to the finish line.
There is no debating that the people who last the longest and earn the most in the e-commerce profession are patient. Don’t worry if this isn’t a natural trait, because you can learn patience the same way people learn to play the piano. Exercises and seminars are available if you need them. At some point, new practitioners must spend several hours a week doing paper trading. Don’t feel left out if you ask the question what is paper trading, as many newcomers are unfamiliar with the term.
It is the act of buying and selling securities using play money in a demo account. For more than a decade, brokers and other trading enthusiasts have used sophisticated computer programs to learn how to place orders, cancel them, and do everything else that is part of a trader’s daily life. Ultimately, however, patience will pay off as you learn to trade unemotionally and with a sure hand.
Basic math and computer skills
To avoid mistakes that make you look like an amateur and to be successful in the long run as a buyer and seller of various assets, you will need to feel comfortable with the math. That doesn’t mean you need to be proficient in calculus or advanced statistical analysis, but it’s essential to be comfortable with fundamental algebra at the very least. If you need to brush up, consider taking free tutorials on websites that train stockbrokers to pass licensing exams.
When it comes to computers, there is no need to understand programming or even know how to write code. However, it’s wise to know your website navigation, and it doesn’t hurt to know at least one programming language if you ever decide to write custom trading algorithms a few years into your career.
A strong relationship with a reputable broker
It’s okay to shop around for brokers when you’re just starting out, but once you’ve made the decision to go full-time and build a career, having a close relationship with a great brokerage firm is imperative. This is not an area where you want to experiment with smaller, unknown companies. Stick with the top rated service providers in the industry. Base your decision on customer reviews and direct experience with several different broker platforms.
Don’t be afraid to make trial subscriptions and use their demo accounts to get a feel for the software, see how their customer service works, and more. Also, be sure to find a respected online broker that offers the asset classes you intend to specialize in, such as forex, stocks, options, or any other area that interests you.
A nose for research
There is a saying among litigators that important cases are not won in the courtroom, but in the law library. In other words, if you know how to do targeted and smart research, you are more likely to make a profit. There are of course no guarantees, but knowing how to investigate, research and research relevant corporate and securities information is one of the hallmark qualities of an excellent practitioner.
An eye for the big picture
Can you look beyond current market results and consider the long-term outlook? If so, then you already have an idea of what it means to see the forest instead of the individual trees. Anyone wishing to pursue a career in the commercial sector must cultivate an attitude and an ability to visualize the overall profitability of a given transaction or series of transactions.
While it’s important to do monthly reviews of results, try to focus on measuring your profitability year-over-year as a more accurate way to gauge your overall success. A good way to get in the mood for big picture thinking is to look at historical price charts for major stock indices. After observing them for just a few minutes, you will deeply understand what can happen in a year, several years, a decade or half a century.