Stock Trading: Strategies to Make Money with Stock Trading: Stock Trading Series, #2

Introduction

In the previous book of the series, Beginners Guide to Stock Trading, you learned about the basic fundamentals of the process that constitutes stock trading. In this book, we go a step up and focus on the strategic part of trading.  Even though the first book gave you a reasonably good idea about what stock trading entails, we all know that Rome wasn't built in a day, and you will need to understand the process in a lot more detail than was possible to explain in the first book.

This is especially true with regards to the fact that stock trading is more of a well- planned and executed methodology of making money than it is a casino-like environment where on a good day, you can make the fortune of a lifetime. As a matter of fact, this is precisely the reason why so many people who should be investing in the stock market and taking advantage of its ability to provide stellar returns are reluctant to do so. This is a real pity because stock trading has the ability to transform people’s lives like nothing else can.

The prospect of gambling away their hard earned money on the stock exchange scares them off. While it is true that investing in the stock market carries an element of risk, the way to deal with it is to gain a deep and insightful understanding of how the market operates rather than steering clear of it. There is risk in crossing the road and flying as well, but that does not stop us from doing those things.

The thing about stock trading is that if you don’t misconstrue and misunderstand it, it can almost be viewed in a spiritual right. The potential of unlimited wealth creation that stock trading carries can transform the lives of millions and make people's wildest dreams come true. That, in and of itself, probably propels millions to try their hand at stock trading.

Then again, it is money made by honest means by studying the market and industry conditions very carefully. So it is money made from the sweat of one's brow just as it is in the case of any other kind of earnings from your profession.

The economy of the world keeps on growing. Earlier, it was the US and Europe that were the engines of growth.  Now there are newer regions including India, China, Asia, the Pacific region and so on.  NASDAQ and FTSE and not the only indices to track; there are so many more.

Opportunities abound and along with them so does complexity.

But all the same, getting intimidated is not the answer and the way to stay relevant is to change with the times and adopt new technology. As a matter of fact, more and more people from around the world are taking to stock trading than ever before. The stock markets of the world are very democratic institutions these days and allow anyone and everyone to trade with a click of a mouse.

In fact, there is a silent revolution underway that is allowing millions around the world to increase their wealth by trading.

If this were not the case, there would not be so many people from different walks of life who have been perfectly able to make a great deal of money by trading on the stock market. This book will show you exactly how. As with the last book, this new addition will carry a summary of every chapter at the end, along with actionable steps you can take to hone your trading skills.

Frankly, I don’t see markets; I see risks, rewards, and money. – Larry Hite

Chapter 1:

Getting Started with Stock Trading Strategies

1.1 - What is a Stock Trading Strategy?

Let us not begin our initiation into stock trading strategy by using some heavy jargon, as there will be enough of that later in the book. In a simple and straightforward language, any well thought out plan that helps an investor obtain profitable returns over the short or long term can be termed as a stock trading strategy. You could also refer to it as a disciplined and structured way of