The advantages and disadvantages of online trading




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The advantages and disadvantages of online tradingThe Advantages and Disadvantages of Online Trading

Online trading is almost commonplace these days . Everyone from investment clubs in senior citizen centers, to financially savvy college whiz kids, to the average Jane or John living in middle America can easily become their own online money manager. All it takes to partake in online trading is some spare cash, the desire to invest, and creating an online brokerage trading account. Although the process of online trading is simple and just about anyone can do it, there are both advantages and disadvantages you have to consider if you are deciding on signing up.

Lets find out what the advantages and disadvantages are for online trading

The advantages of online trading :

You have the ability to manage your own stock portfolios

You will have more control and flexibility over the types of transaction you choose to conduct

The commission costs for trading are significantly less money than using the services of a professional broker

You can get access to lower fee mutual fund investments

Online brokerage firms tend to offer their clients a slew of tools included real-time Level 2 stock quotes, news, financial tools and graphs to help you do research

Some online brokerages will provide their clients to free access to high quality research reports created by Standard and Poor and other predominate financial players

Online account investors have access to their accounts 24/7 although market hours (trading hours) are from 9:30am to 4pm

As long as you have access to a computer and the internet, you can take steps to manage your finances wherever you may be

The disadvantages of online trading :

First time investors may get sucked into all the technology and may temporarily forget that they are actually using real money

There is no mentoring relationship between a professional broker and an online trading account holder, leaving the investor out on his/her own to make choices

Novices not familiar with the ins and outs of the brokerage software can make costly mistakes

Like any financial strategy, committing yourself to online trading takes research and dedication to make sure everything is up to par. By taking the time to do your research you will be able to overcome a great learning curve and even possibly make some money from online trading.