Online trading in South Africa is becoming more and more popular, but it is often complicated especially for beginners. This article aims to answer all the questions that an aspiring trader may have.
Accessible to everyone nowadays, online trading will probably attract you as well. However, if you are a beginner, you probably do not know how to do this or where to start trading. This article aims to answer all the questions that an aspiring trader can ask, such as:
- What is online trading?
- How does online trading work in South Africa?
- How to trade: short or long term?
- How to support yourself financially from trading online?
- Why trade?
What is online trading?
First of all, let’s understand concretely what online trading is. Basically, trading on the stock exchange involves selling or buying assets on the financial markets. It can be Forex trading, stock market trading or even crypto trading. Forex and crypto-trading are among the most popular investments among independent traders.
Online trading allows you to make transactions from home, as a basic or secondary activity, after a working day. It is most often a matter of trading on your own, meaning that the online trader invests his own capital.
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How to start online trading in South Africa?
It is very easy to start trading online in South Africa; all you need is the following:
- A computer, tablet, or smartphone,
- An Internet connection,
- An online trading platform,
- A stockbroker.
You probably already have a computer, a tablet or a smartphone, as well as an Internet connection. All you have to do is choose a platform and a broker.
The most used platform remains MetaTrader 4. Robust, intuitive and perfectly adapted for Forex trading (unanimous opinion), MT4 makes trading an ideal practice for beginners.
As for your broker, you need to make sure that it is regulated by the FSCA, ASF or FCA or other reputable European authority.
You also need to make sure that it offers the tools you intend to trade and that it offers traders a demo account to test how they trade before investing real money in the markets.
How do you learn trading online?
In online trading, learning the basics of stock trading is essential. Many online trading courses are available in South Africa. If some cost, some are free, especially those offered by your broker.
You need to master the basics of trading before investing in the stock market, primarily because you can lose your entire capital from the first minutes of practice. In financial market trading, training and instruction are therefore a necessity.
Once you have mastered the basics of trading, you can put them into practice on a demo account. This account allows you to trade in real market conditions, but with a fictitious capital, so without taking any risk. The demo account is also known as the virtual stock exchange or paper trading.
How to make money from online trading in South Africa?
Once you have trained and have enough experience to practice stock trading, you are probably wondering now how to make money.
It should be noted that in trading, profit and loss are the order of the day. To maximize profits and minimize losses, here are five tips to keep in mind:
- Take a trading course or training (unanimous opinion),
- Create and adhere to a trading plan,
- Manage your risks well,
- Set the right goals,
- Watch your goals closely.
Conclusion – to trade or to invest?
The stock market is now accessible to all and allows some to make a living from this activity, which is why online trading still has a promising future. This is also the reason why trading is strongly criticized by some, who consider it a pure speculation and contrary to traditional or longer-term investments.
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