How Does Trading Work?

So you’re normal 9-5 job just isn’t cutting it with the rising costs, and politicians who don’t look like they’re going to fix the problem any time soon, and it doesn’t look like the welfare state is going to help you either. In a situation like this, you may think, ‘surely there are other ways of making money myself?’ Well, yes, there are many. For example, let’s talk about online trading.

Investing & Stock Trading

Investing is essentially a means of turning money into more money, using the leverage of changing values within a market. An example that nearly everyone ends up doing at some point in their life is buying and selling property. If you buy a flat for $100,000, rest assured it won’t be that much several years later when you sell it because property prices change as a result of inflation and other economic factors, so you sell it for $130,000, i.e., $30,000 profit. This is the kind of long-term investment that we’re accustomed to.

The only difference between this and what stockbrokers do, is the size, volume, and frequency of investments. If you notice, for example, that the price of a stock in a particular industry, e.g., steel, medical supplies, or handbags, is growing, then it makes sense to buy that stock while it is still at a low price and then later sell that stock when its value is at its peak. Thus, you have made money simply by buying and selling at the right times. There is, of course, just one problem with all of this.

Nobody, and I mean nobody, can predict the stock market. Prices can fall just as easily as they can rise. The trick is not to panic and pull out right when an investment goes opposite to what you want. Sometimes one needs to cut one’s losses, yes, but other times, the stock value can bounce back into profit again, and you’ll look very silly if you missed it because you bailed in a state of panic.

Cryptocurrency

There is no rule that says that you need to deal in dollars, euros, or pounds. Cryptocurrencies are digital, decentralized currencies. They can be a very useful means of getting transactions done quicker, maintaining greater autonomy of your personal finances and preventing funds from being siphoned by a third party by getting involved with a bank or the government. Of course, it can also be an exercise in extreme anxiety as you try to navigate one of the most volatile markets going. Then again, where there is a risk, often there is a reward too. Just look at OKX’s Dogecoin live price charts if you doubt this.

Trading in A Nutshell

Trading is just the buying and selling version of the following universal business principle. Money comes to people in exchange for value. In a traditional 9-5 job, you get paid for the value you provide to your employer by giving them your time, skills, and experience so that they can supply customers with goods and services. With trading, you acquire value by buying things when nobody else wants them and selling them when they realize they do.

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