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There is a great deal of services available to people online thanks to the increase in internet usage and the effective and faster network speeds. These things include purchasing airline tickets, renting a car and booking a flight. It has become increasingly popular for people to go to the internet first, knowing that the cheapest hotel rooms or flights will be online. The same is true for shares and stocks. A large number of people have begun to trade stocks online. One question that continuously arises is "How can I trade stocks online safely?" In the past, if you wanted to trade stocks online, you would have had to hire a stock broker. In your conversations with the stock broker, you would tell him/her what companies you wanted to buy shares in and in what price range or what shares that you currently owned you wanted to sell. The next step would be for your stock broker to go to the stock market and carry out the trade that you had spoken about. Following the trade, your stock broker would send you a note to confirm/deny if the trade had occurred. The last step would be for you to receive a certificate in the mail for any and all shares that you purchased, which you would need to keep in a safe place. Although it is easy to trade stocks online, you should still approach online trading with the same cautions that you would approach trading through a stock broker. It is still important to do an adequate amount of research on the online stock trading companies that you are considering. Create a budget, setting the amount of money that you want to spend on your shares and be sure to set limits based on the movement you have observed in shares. Setting limits for yourself helps you remember when to get out of (or sell) your shares. For example, you can set a loss limit of -40%, which means that if your shares drop by 40% you will then sell them. You can also set gain limits, which means that if your shares increase by the amount you designate, you will sell some of them and the profit that you receive from selling them is your gain. No one can choose the limits you set for yourself but you, it is important, though, to remember to stick to your limits once you set them. Not sticking to your limits could mean the difference between profits and failure. It is also important to set a budget for yourself. It is very easy to buy stocks online, therefore setting (and sticking to) a budget is imperative- you don't want to go crazy buying stocks! Remember that there are risks involved when you trade stocks online, therefore setting a budget will be a reminder of the how much risk you want to take. You never want to max out your credit card or drain your bank account buying a share online and then (your worst nightmare!) the stock plummets- you have now lost everything and acquired credit card debt on top of that!

One of the biggest benefits when you trade stocks online is that you gain access to an online account with an online trading company. Having this eliminates the need to store a physical share certificate and worry about storing it in a safe place. You not only get to buy and sell your shares online, but you can sign into your account and check in on how your shares are doing at all times. As with anything that involves risk, it is important to do your research before you setup an account with an online trading company. Important things to find out include: - Where in the world is the company located? Decide if you want to choose a company that is not based in your home country. - What fees, commissions and other charges will you incur when buying, selling and trading shares online with this company? - Is there a charge per quarter to keep your account open? - What happens if your chosen online broker is no longer available due to a move, career change, area of interest change, etc.? (Though you should know that before your accounts can be sold to another online trading company you must be informed and given the opportunity to take your business to the online trading company of your choice) In order to be profitable when you trade stocks online, use the tips above as your guide. Online trading can be pleasurable and profitable. Just be sure you plan your investments- do not go in without a plan. Once you have the plan, stick to it. Change your plan as necessary by monitoring trends in the market and hopefully, make some money!

Terry Tran of, is the chief trader and portfolio manager of a very successful global hedge fund. For a limited time, claim your FREE copies of the Special Reports "Top 10 Ways to Become a Successful Stock Trader" and "Ten Steps Necessary to Build a Solid Winning Stock Trading Plan" and also receive a BONUS 3 month subscription to the highly acclaimed 'Trading in the Zone' daily trading mindset preparations valued at $197 from Avoid the mistakes and begin building a profitable trading action plan today.

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