Trading online is a good way to create some extra money, see your portfolio grow, and learn about the stock market. However, if you're beginning with earning money through trading, it can be very confusing in the beginning as you will find so many terms that include it, such as for instance fees, broker, margin call, short selling, or stop loss. This informative article will cover these important points in simple language for you.

Fees:

Among the first things you'll hear about when trading is fees. You will find two types, broker and commission fees, with many brokers charging a portion for every single trade. You can get best brokers on trading-digest.com. Commission fee rates can range anywhere from $0 to $50 per transaction—more on that in a moment —and often depend on how much cash you put down.



Margin Call:

A margin call is when you owe money to your broker or brokerage firm, and they need it immediately. How much cash this could depend on how much stock was purchased through borrowing funds (buying on margin), how long ago it had been bought, and what sort of stocks were purchased.

Short Selling:

This term describes when someone is betting that stock prices will decrease over time by "borrowing" shares of stocks from their brokers—basically borrowing money for free with hopes of buying them back at a cheap down the road, which would give them some extra profit.



Stop Loss:

A stop loss is once you set a specific price point on any given trade making use of your brokerage account, which automatically closes out that position is reached. This will also work backwards by setting up "stop limits" where prices are only permitted to fall within an exact range before transactions are made.

Conclusion:

Controlling risk is an excellent rule to follow in regards to stock market investing. Always play within the boundaries. If you can't, then steer clear of these markets altogether. You can visit trading-digest.com to gain access to chart tools, news feeds, streaming quotes (real-time) / research reports, and brokersto trade easily.