Stock Trading Is ? Explanation & The Right Way of Trading Stocks

The Right Way of Trading Stocks
The Right Way of Trading Stocks. photo by Nekrashevich

 Stock trading is the activity of buying and selling shares in the capital market through online trading applications provided by securities companies,

It can be in a short period of time, a matter of hours or minutes, it can also be in a long period of time, it can be monthly to yearly, it is still considered stock trading

The time for stock trading is when the stock exchange begins, at 09:00 AM, and ends at 16:00 PM, working days Monday – Friday unless there is a public holiday or holiday

Stock market opening hours in different US time zones

stock market opening hours in different US time zones
Source :

It is at those times that stock traders buy and sell shares,

The life of a trader is very active in front of his PC/Laptop or Smartphone screen every day, in contrast to investors who buy a stock once and then just sleep and wait for the dividends to be distributed.

What is the difference between trading and investing in stocks?

What is the difference between trading and investing in stocks
It should be noted, if the original investment is, those who buy their shares and only enjoy the benefits of the dividends distributed,

But if they enjoy the proceeds from the sale of shares, yes, their name is a trader

That's the difference..

Most profitable, trading or investment?

Most profitable, trading or investment?
When compared to which profit, both are equally profitable, but if the question is replaced "Which is more profitable?", it will cause many perceptions

Fundamentalist investment experts, will definitely answer, it's better to invest properly than trade, but in fact to get a lot of profit, this method takes a long time.

While in reality, trading with limited capital, can get a lot of results in a relatively short time, (if it is always profitable)

Examples like this:

If we invest: January 2021 we buy stock A, in March 2021 we have 20% profit, in the next 2 months in May 2021 the price drops 15%, what does that mean?? from January 2021 to May 2021 we only get 5% profit

In contrast to trading, in January 2021 we buy share A, in March 2021 we have earned 20%, then we sell the shares, Then in May 2021 share A has decreased by 15%, as traders we buy more stocks that are falling, then sell again if it's going up

Then the profit generated is much different, more trading than real investment, this is a fact

Types of Trading

Actually the various trades are only divided based on the time span played,

Stock Swing Trading

Swing stock trading is a relaxed type of trading with a relatively long period of time, it can be weekly to monthly, depending on the target set by each trader.

Usually in swing trading traders use additional indicators that are often used are MACD, Bollingerband, Moving Average, and News

Stock Trading Scalping

Stock scalping is a type of trading in a relatively short time span, it can be a matter of minutes, even hours in one day,

Often called the pickpocket model, the price goes up a little selling, the price goes down a little buy, like that, and this requires more concentration and makes the heart sport not relaxed.

Usually the indicators for analysis used are Stochastic and Bandarmologi

So what is the right way to trade?

We will explain how to trade correctly in the following explanatory points:

Choose stocks that have at least a good track record

It doesn't have to be blue chip stocks, or LQ45, IDX30 stocks that have a large market capital, but small Tier 2 or Tier 3 stocks are fine, as long as the company clearly has a profit, and debt is not too high

Why should that be? because trading is high risk, we have to anticipate when experiencing losses, aka stuck, at least these stocks can rise in price someday because they have a good track record

 Set Take Profit and Sell Lost  Limits

This is often overlooked by traders, especially beginners.

As a trader we must have a clear trading plan, when to take profit when to sell lost, this is very useful to avoid stuck terms and avoid greed

"Indeed, in trading, we have to feel quite a lot"

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