Looking for online discount brokers? If you are veteran trader and are tired of paying high fees then a discount broker is the smartest way to go. They offer most if not all the services as a full service broker, but a fraction of the cost. Most of the transactions are automated. This cuts down on the overhead. Now on the other hand if you are not an experienced trader and need some hand holding during the emotional ups ans downs then a discount broker is not for you.

How do you find the discount broker that is right for you? This depends on several factors. Do you do all of your own research and analysis or do you the broker to provide it? Do you only care about price? Does the online discount broker offer DAT (Direct Access Trading) for maximum speed?

Research and Analysis

How do you gather and process information. Do you read newspapers, online feeds, inside information? You may want to check out some of the services offered by discount brokers. Many of them offer valuable information for free. Some even provide news, research, and analysis tools. Ameritrade, and Questrade excel in research tools. They are two of the best discount brokers.

Rock Bottom Price

So you do all of your own research. You don’t need any help from your broker at far as analysis. When you start doing research on individual online companies be aware of the wide range of price options within them. A good discount broker will not have any hidden fees. Read the small print or call them up and ask about fee structures. Aside from hidden fees do a price comparison on commission payouts. Make sure it is simple to understand. Complicated commission structures are usually a red flag. Always choose a broker who charges minimum commission without complications.

Speed and Service

The trade speed of discount brokers should also be considered if you are doing day trading. Most online discount brokers offer Direct Access Trading (DAT) facility to have instant access over the market. If you are going to be working outside of business hours then make sure they offer 24 hour service. If you considering a small online broker the make sure they are properly licensed, have a record of solid saving claims, offer volume discounts, rebates and account protection. If you are looking trade in a variety of markets make sure they offer them. Some specialize in certain segments.

While doing your research pick out 5 possible candidates and list the pros and cons along with price. Then do some online research to find out what other customers are saying. Internet forums are great way to get the scoop on discount brokers.

Looking to break into the world of online foreign exchange trading? If you do it right there is good money to be made. It’s possible to make an average 10% monthly return on your investment. Commonly referred to as the FOREX, it almost completely automated. That means it’s a great online moneymaker that operates 24 hours per day. Do don’t have to wait for the markets to open as you would with stock trading.

Trends and Factors

It will require some trend analysis. It’s all based on the value of currency. You will need to study the basic ups and downs of specific currencies so you can predict any changes and gain profit. You also need to learn about factors that affect the price of the currency you are investing in. Some examples are: political events, market trends and the general state of economy of the country’s currency in which you are trading. Accurate trend and factor prediction determines the proper time to buy and sell.

Currency Pairs

Currency trading is done in pairs: US dollar and Euro, Japanese yen and US Dollar etc. Another benefit to this type of trading is you can make money on up and down markets, similar to shorting in stock trading.

Getting Started

Many beginners get started by finding a registered broker. These individuals or companies have contact with other buyers and sellers and can help you with the trading. Once you learn the ropes you can trade without a broker. All you really need is a good Internet connection and an account with a reliable online brokerage company.

Many online brokerage companies allow you to sign up for a free demo account so you can practice trading. This is a safe way to learn so you don’t lose money during the learning process. There are many FOREX trading systems on the market today. How do you know if they are legit? Ask for proof! If they don’t show you the numbers over a six-month period then don’t trust them. Why six month? Anyone can get lucky several months in a row. You want to make sure they are consistently earning with there system.

Goal Setting

To be successful in FOREX trading you need to set goals. It’s a lot like casino gambling. If you have a big win, it’s very easy to throw the money back into the market and quickly lose it. Goal setting prevents this behavior. Know exactly how much you are going in on each trade. Have a plan for entry and exit. A solid plan with always reap more profits.

Looking for the cheapest online trading system? You need to be careful when selection an online trader based on price alone. There are 3 things you need to consider:

Disclosure of Fees

The advertised rates might be cheap, but is that really what you are going to pay? Online brokers will sometimes tack on hidden fees such as ECN, fees, software fees, wiring fees, etc. Make sure you read the fine print and know exactly what you will be charged.

Service and Support

Does the company offer any training or educational support. Some day trading firms allow you to listen to live market calls. This is huge. Do they offer training videos, telephone support or live chat support. This may not be important initially, but you need instant support of you run into technical problems.

Risk Reduction

To avoid heavy losses consider pre-set limits on trading. Risk-monitoring services can save you a bundle in case of there are some major market movements. You want to be able to set maximums on positions, losses etc. The risk is still on your shoulders so educate yourself on the auto-protection services each company offers.

Forex

Online forex trading is basically buying and selling of currencies of different countries. When an investor thinks that the value of money go up or down in the near future, they buy that currency with a plan to sell it when the value reaches a certain point. The difference in the buying and selling price is his profit. The quick return offered by Forex trading has made it a lucrative option for many investors.

Commodity Trading

A commodity futures contract is an obligation to deliver or receive a commodity, such as gold or silver, on a particular date in the future for a price that is agreed upon today. If you are aware of yearly price fluctuations you can purchase those commodities in off season and hold them. You can make huge profits if you can predict this correctly.

What it Takes

A successful trader has to master a set of skills. Control emotions is the most important. Emotions are what bring so many into the game, but if can’t ride the ups and downs with out some detachment you in trouble. You may want to hire a mentor to get some hands on experience. The training received from a mentor is always superior to books, videos or software.