Trading online is a big decision. An even bigger decision is which broker to go with.
First let's look at the brokers available to you. First, and most obvious, are the banks. They are your all round share trading & currency trading websites where they will charge you around $20 or .12%, which ever is greater. Then there is also a monthly charge with some, which is around $80. Following that you need to also be connected to the bank in a major way, be sponsored, etc. Of course this will vary from bank to bank, although the big ones are about the same.
HSBC, not one of the big Australian banks, looks a little cheaper, but only by a few dollars.
One off trades and trades over the phone can incur higher fees again.
If you're looking to only make a few hundred dollars extra a month, then most of this will be wiped out in those fees. So let's look elsewhere for now to compare.
Have you looked into trading CFDs?
It isn't for everyone as it is a leveraged product, therefore it is possible to lose more than you initially deposited.
The turn around side of that is that you can benefit from larger earnings with a smaller amount of money.
If you decide to trade with Trade Direct 365, you are only paying $5 a trade (unless your trade value exceeds $7,150, then you are charged a small .07% of the trade amount. So, for example, a $10,000 trade is $7.
Did your eyes open so wide they hurt when you saw me talking about thousands of dollars of trades?
Did you look into your wallet or purse, then check your bank balance and decide that there is no way you have enough cash to make any difference in your cash flow?
Well, you may have forgotten that CFDs are a leveraged product, so you don't need the full amount because you are not actually spending money on the shares themselves, instead you are buying into a Contract Of Difference. This allows you to benefit from the up and down motion of shares or currencies without having to buy part of a company or invest in a currency - that is of course as long as you bought or sold at the right time. And that's where a little study and learning can go looooong way!
A simple explanation is that you are standing out the front of a person's house and can see it has been built well, is maintained well, is in a good suburb with a school nearby. You then come across an establishment that allows you to benefit from your knowledge by buying into a Contract of Difference, or in other words, buying a contract that states that you believe that house will go up in price today, this week, this month, etc., depending on how long you decide to keep that contract open
(most contracts have no expiry, also, bear in mind that there may be interest applied in either payment or debt when you hold a contract over night. In the case I just mentioned, you will pay a small amount of interest in most cases. If the contrat you went into was that you had decided that the house would go down in price, then you may well be paid interest. Confusing you? Sorry, but I thought I should add that information so you knew that holding a CFD over night does sometimes incur an interest payment. Maybe see my other blog or the Trade Direct 365 website for more information to clear that up).
If you wish to sign up with Trade Direct 365, even if it is just the demo area so you can trade pretend money on the real stock exchange, then see below:
Created by a trader, for traders, as well as novices, TradeDirect365 is not only a fair & effective platform for everyone, but also Australia’s best value online CFD and Forex provider.
**When you sign up online, type: MAT CLARKE,
in the “Where did you hear about us?” area to ensure you get the current special on offer.
www.tradedirect365.com.au
Trade on your phone or iPad or tablet device.
Yes you can trade anywhere now! Is this good or bad?
For many, they will say, good. However that could tempt you to make additional trades, and if you're paying $20 or more per trade, then that probably isn't a great thing.
If you're trading at $5 per trade, then yes, it is great because you can be watching your money go up (hopefully not down), and then end the trade when it suits you. A much smaller fee means even greater profits for you!
In closing.
I have at least now given you a lot to think about.
I like the idea of CFDs because I can get out when I want and it is cheap to do so.
Long term shares have their appeal, and I have them as well, but they are not going to help me make money this week, or even this year. Therefore, I'll trade CFDs and make a little extra cash for me right now :)
So, in the end it's up to you to decide what you would like to do. Have a think, do your own searches. Play around on the Trade Direct 365 website and see what you think about the demo area. If you like it, and see that you can make money on the demo site, then sign up. Just remember to add, Mat Clarke, to the area about how you found out about the site. Then the site will give you their special offer that's currently out. Feel free to email them and tell them you are expecting a special offer, too!
