Stocks & Share Investing: How to Get Started

The aim of StockWatch is to teach beginners with no previous experience about investing. These articles will teach you why investing is important, the magic of compound interest, how to invest in shares, how to choose your own broker and how to buy your first parcel of shares.

Owning stocks is not rocket science, in fact, 46% of Australians own shares directly or indirectly*. All you need is a basic understanding of how the sharemarket works, the share language, patience and discipline.

These articles will familiarize you with the fundamentals of the sharemarket, so make sure you join the StockWatch share market game to put what you learn into practice. Other than the prizes on offer, the StockWatch share trading game will allow you to test out your own trading strategies without the stress of losing any money.

*ASX 2006 Australian Share Ownership Study

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Articles

Day Trading

High Frequency Trading
High frequency trading (HFT) is a new type of trading that involves using computer algorithms and programs to make automated trades in the market.

What is a Trading Robot?
Computer.

Common Day Trading Myths and Lies Debunked
Day trading is one of the most exciting yet misunderstood forms of making money from the stock market. Here are some common day trading myths exposed.

Day Trading Rules Part 1
Learn the precise moment to enter a long position with these basic entry rules for day trading.

Day Trading Rules Part 2
Learn the precise moment to enter a short position with these basic short entry rules for day trading.

Buying and Selling With the Trend
For trend trading, I recommend using 5 minute charts – if not a longer time frame. If you use too short of a time frame you will encounter a lot of ‘trading noise’.

Day Trading: The Art of Controlling Your Emotions Part 1
If you have not yet experienced day trading let me walk you through a typical trade and the emotions you will feel.

Day Trading: The Art of Controlling Your Emotions Part 2
Learn how to separate your self-esteem and worth from a trade. A trade is just a trade – nothing more and nothing less.

Intermediate Setups and Creating a Bias Part 1
Learn how to create setups and bias using trendlines and the moving averages (10,20ema).

Intermediate Setups and Creating a Bias Part 2
Learn how to use the 10 and 20 period moving averages on the 5 minute chart to identify profitable trading zones.

The Art of Channel Trading
What is channel trading? Learn two techniques to play a channel trade.

Day Trading Example: Walking Through a Trade – Part 1
We will walk through an example day trade as to how our thinking process works and the considerations a daytrader needs to make.

Day Trading Example: Walking Through a Trade – Part 2
We will walk through an example trade as to how our thinking process works and the considerations a daytrader needs to make.

Tracking the Market and Day Trading Your Stock
When you track an index you get a clear picture of what the broad market is doing. Keep you eyes out on popular index when deciding whether to buy or sell intra-day.

Commodities

NEWInvesting In Silver - 7 methods to gain exposure to silver
There are many reasons to invest in silver – from diversification of portfolio to having physical currency. Here are 7 methods for you to gain exposure to silver.

Should I Buy Gold Now?
Over the past 10 years gold has rose over 6 times in value. However more recently, gold has made a pull-back. Is now a good time to buy gold?

Should I Invest in Gold? Pros and Cons of Precious Metal Investing
The price of gold has rocketed over the past years. Should you buy gold or pass on it? What are the pros and cons of such an investment?

Derivatives

Learn all About Trading Options 10 articles
This options trading series will teach you very important aspects of options. The part series 'Introduction to Options' will teach you tips and strategies for trading options.

NEWLearn how to trade CFDs (Contract for Difference) 11 articles
Is it possible to turn $13,000 into $30,000 in 3 months or pull in $65,000 in one week trading CFDs? Find out how CFD trading (Contract for Difference) is taking the financial world by storm.

Learn How To Trade CFDs: Developing a system that should make us money
Trading CFDs profitably require a careful risk management plan. Learn how to systematically look at CFD’s in bite-sized portions to develop system that should make us money.

Forex

How to Trade FOREX – Beginners Guide
The FOREX market is the most traded financial market in the world. What exactly is the FOREX? Can you really make money from it?

Trading Forex
Do you love keeping up with current international events in the political and economic realm? Then you might be a good fit for being a currency trader. Here is how to start...

Fundamental Analysis

Fundamental Analysis: Introduction to Fundamental Analysis 10 articles
Fundamental analysis is the study of economic and company related factors that will influence share price. For most long term investors, fundamental analysis is the cornerstone of good stock selection.

Funds

NEWPhysical ETFs vs Synthetic ETFs
A synthetic fund is one that does not need to hold the identically matching underlying shares in support of ETF pricing. synthetic ETFs are able to perform feats that traditional ETFs cannot.

ETF Trading
There is a huge variety of options when it comes to trading ETFs. ETFs can be bought and sold short. They can mirror an index, sector, or even an entire country.

Managed Funds or Direct Shares
Before you can know how to best invest your money you need to first make a plan. Choose an investment vehicle/s that will best reach your invest goals.

Managed Funds - Choosing the best fund for you
Managed funds, also known as unit trust or mutual funds, allow investors to pool their money together and buy different companies.

ETFs (Exchange Traded Funds)
An exchange traded fund (ETF) is a cross between an index fund and a stock. It combines the low fees and diversification of an index fund and the liquidity of stocks.

Introduction to Index Funds
An index fund works by buying all the securities that make up a specific index, for example the S&P/ASX 200 index. Find out if you should invest in a Index Funds VS Managed Funds.

Investing

How to Budget Your Money
Although a budget can be an overwhelming task, It needs not be once you break it down into manageable steps.

Which Credit Card Should I Get?
Choosing which credit card to get will depend if you pay out your balance every month or if you carry them over.

8 Steps to Financial Freedom
Do you have the dream of financial freedom? How do you achieve this goal of financial freedom? What are the strategies? Here are the 8 steps you can take.

How to Get Out of Debt
There is nothing quite as crushing on a person’s spirit than the overwhelming burden of debt. So how do you get out of debt? Here are some considerations:.

Can I Retire on 1 Million Dollars? Is it Enough?
One million dollars has been the benchmark for individuals saving for retirement. But is one million dollars enough to live comfortably on? You might be surprised by the answer.

Asset Classes
The 3 main type of asset classes includes shares, property, fixed interest. Which asset class should you invest in? Each of the asset classes above have their own risk/return profile.

Dollar Cost Averaging with Example Calculations
Dollar cost averaging involves buying assets at different prices by making regular deposits. As a result, you purchase more units when prices are low and fewer when prices are high.

Choosing a Finance Advisor
Unfortunately, finding a good financial advisor is not as simple as it should be. Where to look and questions to ask.

Investment Vehicles – Best way to invest your money?
Before you can know how to best invest your money you need to first make a plan. Choose an investment vehicle/s that will best reach your invest goals.

Planning Your Investments
Before you go straight ahead and invest your hard earned money, make sure you have an investment plan. What is your time frame? What is your risk appetite?

Magic of Compound Interest
Albert Einstein called it the 8th Wonder of the World. Compound interest is one of the most basic and powerful concepts that can enhance the outcome of your investments.

Shares

NEWIf I Could Only Invest In One Thing...
If I could only pick one investment to put my money into – what would it be? Precious Metals? Technology, Oil or Food?

NEWThe S&P/ASX 200 Index (XJO)
The S&P/ASX 200 Index is a float-adjusted market capitalisation index. Only companies that are large enough and that trade with enough liquidity are included in the index.

NEWTrading the ASX 200 Index: ETFs, CFDs, Futures and Options
How do you go about buying or shorting the S&P/ASX 200 index in an efficient manner?

NEWS&P/ASX 200 ETFs: STW, IOZ, VAS
The 3 most popular Exchange-Traded Funds ETFs for the ASX 200 are the iShares MSCI Australia 200, SPDR S&P/ASX 200 Fund & Vanguard Australian Shares Index ETF.

NEWWhat are E-Minis Futures? How do I Trade Them?
An e-mini is a term used in futures trading. They are usually one-fifth of a major contract when index trading.

Investing VS Trading
While investing can involve some elements of trading, and vice versa, they are two different concepts.

Making Money In a Bear Market
How can long-term investors play this bullish market to protect capital and even make a little extra profit?

Make Money Trading The Share Market
Making profits in the market is not easy and requires that we control behavioral problems. You will need to adapt your techniques for a bull and a bear market.

How to Trade Like a Professional Trader
From choosing a broker to selling shares for profit, this is your quick guide to trading like a professional.

What Shares Should I Buy?
Although you have likely gained some knowledge about the process to buy and sell shares, here are some publicly traded companies in the Australian Securities Exchange (ASX) to get you going.

Investing in Cloud Computing Stocks
What is cloud computing and how might it change the way we go about business? Is it a good trend to invest in? Which are cloud computing companies to watch?

ANZ vs CBA vs NAB vs WBC
Is now a fine time to invest in banking shares? If so, which of ANZ, CBA, NAB, WBC is well positioned fundamentally?

BHP vs RIO
As mining stocks continue to be in the limelight – which one will come out on top as the winner in the ensuing battle? BHP or RIO?

Creating a Trading System
How do you go about creating a trading system? Here are some checks and balances that you can employ to raise the odds of it being a winning system.

David (DJS ) Jones VS Myer (MYR)
With these two companies competing for your investment dollars – which should you buy, DJS or MYR? Let’s examine them both...

How to Treat Trading Like a Business
If you treat trading like a business, you will have better odds of being successful with a rewarding career.

Creating a Trading Plan
Before you start buying and selling stocks, you need to create a trading plan and consider three key areas: Core rules, Psychology, Risk management.

Wesfarmers (WES) vs Woolworths (WOW)
In another exciting round of publicly traded companies dueling it out – which of WES or WOW will come out on top?

How To Pick Growth Stocks?
Want to find stocks that will rocket in value? Learn how to pick growth stock by identying criterias such as EPS, P/E, Revenue & Book Value.

What are Income Stocks? Best Income Stocks for 2010
What are income stocks and which ones are ripe for the picking for 2010? An income stock is a quality blue chip stock that will maintain its value while paying dividends. Here is out top 10 best income stocks for 2010.

Building a Investment Portfolio Strategy
Portfolios do not come with a cookie cutter suitable for every investor. We need to analyze the investor and then select stocks that match the profile. To do so we need to consider three main areas: time, risk, reward. Learn how to build a customised portfolio.

Can I Make Money Day Trading? How to Become a Day Trader?
What is the reality behind day trading? Can people make a living at it? What skills and training is necessary to be successful? Is it for you?

Stock Market Investing and Share Market Tips
If I had to pass on a few tips that would help investors most, what would they be? The following stock market and share market tips should help keep you on the profitable side of the market.

What Is Ethical Investing?
Ethical Investments are also sometimes referred to as Socially Responsible Investments, SRI. Some reports suggest that these types of funds will reach the value of 3 trillion dollars by 2011 in the USA and $15.73 billion in Australia. What are they and should we invest in ethical investments?

Guard Your Portfolio With Defensive Stocks
When the market is choppy, trendless, or hard to define, what sort of stocks should you own as an investor? For many the answer is defensive stocks. What are defensive stocks, Why Invest in Defensive Stocks? What are examples of Defensive Stocks?

Short Selling Explained: What is Short Selling
What is short selling? Why do we care? Short selling allows an investor to make money on both sides of the market action. Learn how shorting selling works and why you would short a stock. The rules and risks are also explained.

How Much Do I Need to Invest in Shares
The minimum required to invest in a parcel of share in Australia is $500 however this is not advised as brokerage costs and transaction fees can eat into your capital.

High Dividend Stocks
The process of picking high yielding dividend stocks is not nearly as simple as grabbing the one with the highest yield. Certain stocks have higher dividends than others. What types of stocks would these be? Here are example of quality stocks with high dividends.

Dividend Imputation System & Franking Credits Explained
The dividend imputation system allows investors who have been paid a dividend to take a personal tax credit (franking credit) since the company has already paid tax (30%) on this dividend.

Understanding the Share Language & Jargon
It is important that you understand the language & jargon of shares, as your evaluation of a company may be dependent on one vital piece of information.

Learn how to diversify your portfolio
One of the most effective strategies to reduce risk is through diversification. Learn how to diversify your portfolio.

What are Shares Dividends?
Dividends are the distributions that are paid using profits companies made during the year - it is like a reward to investors who have chosen correctly.

What does ex-dividend mean? How to ensure you receive your dividends
What does it means when a share goes ex-dividend? Learn the important dates of a dividend, ex-divided, record date, payable date and ensure you receive your dividends.

What is 'The Market'
Whether you've read about it in the finance section of the newspaper or heard it on the news, have you ever wondered what they mean by "The Market"? Why is it so important?

Benefits of Investing in Shares
There are many benefits to investing in shares and we will investigate how this common form of investment can be an effective way to make money and dilute the risk.

Choosing A Broker
There are 2 main types of brokerage firms, full service brokerage firms and discount brokerage firms (Online Brokers). Deciding which brokerage firm to use will depend on your trading style.

How to Buy Shares
Step by step instructions on how to buy your first parcel of shares. Learn what 'Bid', 'Offer' and 'Last' prices mean and how you can take advantage of them with your trades.

How to Make Money In Shares
The aim of StockWatch is to help beginner's learn about investing. These articles will teach you why investing is important, how to invest in shares, finding a broker & how to buy shares.

Technial Analysis

Technical Analysis Charts: Charting Range, Chart Types & Patterns 7 articles
Learn about Technical Analysis and Charting. Find out which Chart Type you should be using and learn about the most common Chart Patterns.

Technical Analysis Indicators: Leading versus Lagging Indicators
Technical analysis indicators come in two basic varieties: leading and lagging. A trending market works well with lagging indicators, while a trading market more profitable with leading indicators.

Trend Following Indicators - Part 1: What Is a Trend?
Learn about trend following indicators, ADX, Wilders DMI, Aroon and MACDs. Being able to determine a trend is one of the most important concepts in technical analysis.

Trend Following Indicators - Part 2: Trading The Average Directional Index (ADX)
The ADX is an oscillator type indicator that is used to determine the strength of the trend. Learn how to trade the Average Directional Index ADX.

Trend Following Indicators - Part 3: The Directional Movement Index (DMI)
The most common way to trade the DMI indicator, is to enter a trade at the crossover point. When the red crosses above the green, go short. If the green crosses above the red, go long.

MACD Indicator Explained
The Moving Average Convergence Divergence (MACD) is a combination of moving averages designed to signal a change in trend. Learn the 3 three common approaches when trading the MACD.

Technical Analysis - Momentum Indicators: ROC, Stochastic & RSI
Momentum in stocks usually refers to a rate of change, an increase or decrease in pressure. The most popular momentum indicators are Momentum, ROC, Stochastic and RSI.

The Relative Strength Index RSI Indicator Explained
Trading the Relative Strength Index profitably is what separates the good traders from the bad. We will now discuss a few common methods of trading the RSI.

Stochastic Indicator Explained
The goal of the Stochastic Oscillator (Fast, Slow, and Full) is to determine if the stock price is in the upper or lower trading range over a set amount of time. Learn the three basic ways to trade the Stochastic Oscillator.

Momentum Following Indicators: The TRIX Indicator
The TRIX indicator has become a well used method for momentum traders to determine buy and sell signals. The goal is to super smooth the data security to reduce the volatility and whipsaws.

Volume Following Indicators In Technical Analysis
Many volume trading indicators exist such as the Money Flow Index, On Balanced Volume, Accumulation and Distribution. Whatever methods are employed to track volume, a careful study into how volume works will greatly improve your trading.

Volume Indicators: On Balanced Volume (OBV) Indicator
There are a few ways to profitably trade the OBV: divergence and crossovers. Whether you use OBV to spot divergences in prices, or to play smaller volume breakouts, this tool is best used in conjunction with other tools.

Volume Indicators: Money Flow Index (MFI) Indicator Explained
There are three key signals to use to trade profitably with the Money Flow Index Indicator: divergences, overbought / oversold signals, and crossing of the 50.

Volume Following Indicators: Percentage Volume Oscillator (PVO) Indicator
Just like the MACD, the Percentage Volume Oscillator starts with the 12 day moving average and subtracts the 26 day moving average. Here three main signals are generated with the PVO.

Technical Analysis: The Secret of Moving Averages Explained
Moving Averages are powerful indicators. They can tell you about trends and buy and sell signals generated. Continue reading to learn the secret of Moving Averages.

Learn How To Trade Support and Resistance Levels
Perhaps one of the strongest concepts in technical analysis is support and resistance. Support and resistance are great clues as to profitable entries and exits, and particularly powerful when combined with other indicators in a complete trading strategy.

Technical Analysis: Parabolic Stop and Reversal (PSAR) Indicator
Developed by technical analyst Welles Wilder who also made the RSI and ADX indicators, the Parabolic Stop and Reversal system has proved a worthy indicator for expert traders. The goal of the PSAR is to determine a trend, and then establish buy and sell signals on that trend.

Technical Analysis: Stop Loss & Trailing Stop Loss Orders
Having an exit strategy is vital to the success of any trader. While a variety of methods exist, a stop-loss order is a simple and proven method to capture gains and limit loss.