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Top 5 tips to start successful stock trading on E-Trade

EtradeInvesting, especially if you happen to be a new investor can be a tricky job. You have to learn all the tricks and kicks of this art if you really want to excel in the field of stock trading. You need to know how much to invest, what to invest in, how to do it, when to do it etc. If you gradually learn all the answers to these questions then nothing can hinder you from becoming a good stock trader. If you are carrying out your business through any brokerage option, in this particular case E Trade, then you must be aware of how to play the ropes. After all stock trading business is about saving a nickel from here and a dime from there and eventually these nickels and dimes come together to form thousands. But making these piles of thousands a realistic phenomenon is not easy. You have to learn the tips and strategies of this stock trading game. Following are 5 tips which will help you in becoming a good stock-trader on E Trade.

 

  DON’T PLACE UNSPECIFIED MARKET ORDERS PRIOR TO THE OPENING OF A TRADING DAY.

This market is fairly unpredictable; you never know where you are headed. So be cautious and never make the mistake of placing an unspecified market order before the opening of a trading day. Because it is very probable that you might end up paying more than you intended and receiving less than you expected. Although you might counter this point by stating that risk is the shadow looming constantly over this business, but this risk is most lethal at the opening time. If you have to trade at this time, then try to save yourself from any unforeseen losses by a limit order.

 

THE BEST TRADING TIME IS IN THE AFTERNOON, APPROXIMATELY 1 TO 2:30 pm EST.

As most government statistics which decide the turn market has to take are released in the morning as well as most of the corporate earnings report, so a comparatively safer time to trade is in the afternoon.

 

CHECK OUT THE ‘BID SIZE’ AND THE ‘ASK SIZE’ FOR EXCHANGE-LISTING STOCK PRIOR TO ENTERING A BUY OR SELL ORDER

Always take a look not only at the last price of the stock, but also the bid price and the ask price. If the bid price is larger than the ask price, go ahead and do not hesitate to buy it; because this betrays the underlying demand of the stock. Similarly if the ask size is higher, and then this is automatically a cue for you to sell out quickly, if you were intending to do so. If such a situation arises, where the bid and ask size are equal, and then this is the ripest opportunity for you to enter a bid order.

 

THE BEST TIME FOR BUYING STOCKS.

Keep it in mind that the best time for buying stocks is around 18th through the 22nd. You might be wondering why this is so. This is because at this point the cash flow in the market is at its lowest and so are the prices. Whereas the best -selling time of the month is the first two or last two days. The market usually lowers during the months of September and October so this is when you should do the most buying. While , the selling should be done mostly in the months of April and May.

 

BUYING OF STOCKS WHICH TRADE ABOVE $10 A SHARE

This is so because companies with low-priced stocks are not very stable and are prone to trouble; perhaps so potent that it would even reach the verge of bankruptcy. However this rule can be expiated from close-ended funds, where the incentive is to aid small investors.

It can be said fairly confidently that when it comes to online stock trading at the websites like E Trade , it isn’t much about hard work , as compared to knowing what to do and doing it at the right time. The tips mentioned above will hopefully help in building this knee-jerk reaction in you which should be a part and parcel of every good stock trader. Employ these tips and have a happy stock-trading experience at E Trade.

 

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About Emaad Qureshi