Trading for beginners cours (Part 1)

How profitable is trading and how much can you earn from trading?

To find out how profitable trading is, here we start with the trading course for beginners.

It will depend on several factors:

Knowledge:

The more you learn, the easier the activity will be.

Experience:

The more you practice, the easier it will be for you. Would you try to build a house if you have no studies or practice in construction? Probably not, and if you did, it would probably fall down, wasting a lot of time and money. Before you start building you must learn how to build, this is the foundation, which is your training. While you learn you must practice on a model. Applying this to trading would be to make small trades on a demo account, not on a real one. The first thing to do is to study how it is done, and then with experience. It is not the same the first house you make than when you have 100, 200 or 1000. When you have made a thousand houses, you will surely make them much faster and much better than the first one. Trading is exactly the same, you need training and you need experience.

Profitable trading strategies

The strategies are a series of rules of entry and exit to the market that you must apply faithfully to get results. It is a very important factor, but more important is the system.

The system

It is the main factor that will help you make or lose money, as it is the set of all trading strategies. The psychological factor This point is as important as the system, since it is the one that will make the balance fall in your favor or against you. It greatly affects the operation because you can use the same strategy as the trader next to you, but the psychological factor can be decisive when it comes to hitting the button a second later or a minute later, and that can change all the data. Then there are many people who say "hey, I have seen this strategy and I do not get the same data, it does not work for me" there are times when the strategy works well in DEMO, but not in REAL. What happens? In DEMO you don't have pressure and in REAL you do, so that's why the data varies. When you risk your money, mistakes are expensive, and that is when the psychological factor really affects. Many times, people think that the psychological factor affects mainly when we lose, but it affects as much or more when we are winning. Why? Because when you are winning, you don't know whether to close or keep the position open. When you are winning there is always the psychological fear that the price will turn around and you will end up losing. That is why many traders (usually beginners) close the position early. In some occasions it will be right, in others you will lose big profits. The problem of closing trades early is that if you had stipulated that for every $ 1 you risk you want to earn $ 3 profit (this is known as risk benefit ratio 1:3), and you close early, instead of looking for a profit of $ 3 you end up having a profit of $ 2.5, which is not bad, but it is not what you had stipulated, and if you compare your results in your real trading account with the results of your backtest (testing the strategy in demo to see how it behaves), you will see that they vary greatly, usually for the worse. Therefore, the psychological factor is very important, not only when we lose but also when we win. My recommendation is to avoid closing a trade prematurely. Before entering you should be clear on which points you are going to exit, and not modify it on the fly, unless the modification is part of the strategy.

Monetary risk management

For me this is almost the most important factor in trading. Risk management is having a plan to know how much risk we can take per trade, where we have to place stop losses, when we should wait or how much we should risk in each trade. This is what we call monetary risk management. It is a very important factor, and as you can see all these factors are going to influence a lot in what you are going to win or what you are going to lose. But for me, this factor is 40% of success.

How much do you earn in trading per month?

The answer is exactly the same as before, it will depend on all the above data, and also a fact that I have not told you before that is, depending on the initial capital you have. If you start with a very large capital, you will be able to make operations with a much larger volume than if you start with a small capital. The problem is that most beginners start with a very small initial capital and in order to get profits, they need to risk a lot in each operation.

How much money should I invest to start with and how much money should I start with?

In my opinion, you should not start a live account with less than $1,000. In my opinion, is it possible to open an account with less? Yes, although I only recommend it to people who have experience, who have been trading for several years, because many times we open small accounts of about 500 dollars to test strategies, before putting them to work in real. If it is the first time you get into this sector, I think at least $ 1,000 if you are going to operate with CFD's. If you are going to trade with other types of financial derivatives such as futures, you will need at least $5,000 to $10,000. Important! that money destined to trading must be money saved that you do not need, it cannot be the case that you need $1,000 to live and you have it in trading, under no circumstances should you do that. It has to be a saved money that if you lose it, well you lose it, we all would be upset to lose a thousand euros, but it is not the end of the world, the next month you will recover it. If you need that money now or it will limit your life a lot, the best decision you can make is to wait! Wait until you have it and don't need it, don't start yet. There are alternatives you can do, if you don't have training yet, there are thousands of free training videos like my youtube channel free trading course.

Difference between investment and trading

Objective of Trading

The purpose of trading is purely speculative, that is, the only thing we seek in trading is to buy an asset cheaper than the price at which we sell it. We want to buy cheap and sell expensive. We want or have a 100% speculative objective.

Investment objective

In investment we have two objectives, firstly, we try to buy shares of companies that we think that right now are low or "cheap", that have prospects for growth, and when they rise then maybe sell them. On the other hand, on many occasions, we buy companies that are already consolidated, that do not have much variation, but that generate dividends annually. Then we receive dividends constantly until we receive the money we had invested, which is what we call break-even point. From that point on, if we sell all the shares or keep them, we are guaranteed profits. In investment we have these two options, trying to seek profit at a speculative level by buying cheaper than selling or through dividends.

What are the main ways of trading and what are the main trading styles?

The most popular and the main ones would be four:

Scalping:

Scalping is trading very fast, that is, trading in seconds or minutes. Operations where I enter the market and the moment it moves a little in my favor, I close the operation, that is scalping. It can be done in minutes, it can be done in seconds, but they are very fast operations, even automatic.

Daytrading:

Day Trading is when we make operations that are closed on the same day in which they are opened, that is to say, if I open an operation today, I close it today, I cannot close it tomorrow morning. Trades that are closed on the same day, and mind you, I am not saying in 24 hours, if I open a trade today, I close it today. That is Daytrading!

Swing Trading:

Swing trading is the style of trading that I like the most, the one I use the most, because it is a much more relaxed style where you open a trade and let it run for several days, and even weeks. It is different, it has its pros and cons, we will see throughout the course. In the end it is just that, as you can see, it is a little slower and does not need you, you do not need to be 24 hours in front of the screens.

Trend trading or long term

The trend trading or long term trading is a style that seeks to take the long term trends. This occurs when we leave a trade open for months. This is not normal in trading, when you are already going to make long-term operations for months or years is usually when we go to the investment part.

What are the main styles of INVESTMENT?

An investor does not do Scalping, does not do Day Trading, does not normally do Swing Trading. I say normally because it may be the case that you enter and an operation just soar and you want to close it soon after, or it falls sharply and you have to close it quickly, but it is not usual. If you are an investor, normally what you want to do is to buy shares and let them run for many years because you have made a study of that company, not the share price.

TRADING PLATFORMS WE USE

THESE ARE THE ones WE CURRENTLY USE IN. This is NOT a recommendation, it is simply an opinion as users.

TRANDINGVIEW

The platform with the fastest access, to all markets and free. For me, a must!

THINKTRADER

The best platform for manual and free backtesting For me, Very Necessary!

METATRADER

The most used platform. For me, it is important to know how to use it. That's why we say that an investor invests in value, and we call that style of investing Value investing.

How can you become a professional trader or a professional investor?

Very simply, you can become a professional trader when most of your income comes from trading. Just as you can become a professional investor if most of your income comes from the dividends you receive. In the same way that if you are a clerk and you are asked "What do you do? I am administrative, because most of your income comes from that professional work, here the same, if most of your income comes from one of these points you are dedicated to it and you are a professional in that sector.

How to understand trading

You have the solution at the reach of a click, in this channel we give you all the necessary resources to understand how trading works, how to understand trading charts and above all, how to start trading in the stock market.

Which is the best trading academy?

Obviously from my point of view, brokerjuniors.com is the best way to learn, and in particular the youtube channel "Free trading course". There you will find many free videos for you to see all the possible content that are already of good quality, so imagine what you can get with premium content.

What is the best market to trade?

From my point of view, the easiest option, or less difficult to start with, is the Forex market, the foreign exchange market, and then, when you have mastered it, go to the American stock market. Later, if you want, when you have already mastered it, you can start with cryptocurrencies, it is a very interesting market, but not to start with them in my point of view. Personally I think it is better to go little by little, start in Forex, then move on to stocks, and then if you want to commodities.

Which broker has the lowest commissions?

The most reliable broker, that doesn't scam you and a lot of similar things.... Personally I have never been scammed by a broker. I have been a client of different brokers, in the same way that I have been a client of different banks because services change and so do commissions. Which ones am I currently using? I explain you which is the best stock, forex and cryptocurrency broker for trading. You will also understand which broker to choose if you want to start investing in the stock market.

THE INVESTMENT AND TRADING BROKERS WE USE

DE GIRO

This is the broker that we use to invest in spot stocks. Very low commissions!

ACTIVTRADES

This is the broker we are using to test automatic strategies in Metatrader 5.

DARWINEX

This is the broker we are using to invest in CFD'S It allows to create "Investment Funds

XTB

This is the broker that we use to trade both Spot Stocks and CFDs. They have the most competitive commissions in the market.

THE BROKERS WE USE FOR CRYPTOCURRENCIES

COINBASE

This is the broker I use to buy Cryptocurrencies in cash. Few options but very easy to use. In principle very safe to avoid hacks.

BINANCE

Broker I use for crypto trading. Allows leverage 1:3. Largest crypto broker. I have never had any problems with hacks or similar.

How to get started in forex without money?

This may seem like an absurd question, but it makes a lot of sense and here we explain why. You can start with a demo account. If you don't have money yet, what you have to do is to work on anything, and thus, start saving money. While you are in the procedure of saving money what you have to do is to train yourself, if you do not have financial resources do not worry, go to youtube and subscribe to the channel Curso Trading Gratis. If you watch all the videos that we offer in that channel (Curso Trading Gratis), I guarantee that you will get a solid training in trading and financial markets. At the end you will be able to apply that knowledge to your trading account. When you have managed to make a capital savings, then you can start with real money, but if you want to start with no money in Forex, the only solution is to create a demo account and, of course, train yourself with a Free Trading Course. Do I have to go to a stock exchange to buy stocks? The answer is no. For many years now everything is 100% digitalized, so you don't have to go to any stock exchange, you simply do everything through the internet, with a cell phone, a computer, or a tablet. You need an internet connection and a device. You don't need licenses or anything. There is no longer that image of people shouting "I buy! I sell!", now it is 100% digital, easier and global for everyone. When they were exchanged in hand, it was called "bearer shares". Now everything works digitally with "book entries".

Which trading platform to use?

My recommendation is to start with Trading view without a doubt. It is the easiest, fastest and simplest. Besides, you don't have to download it, you simply access it online. And best of all, it's free! The problem is that it is incomplete and few brokers offer it. Therefore, I recommend that you learn to use Metatrader 4 and some other platforms like those mentioned above. Finally, you should know that you have free courses on our youtube channel to progressively level up or you can sign up for one of our premium courses. You can also leave us your email and we will guide you with new news from the trading world. Take advantage of this opportunity!