- 1). Learn fundamental analysis and apply it to your trading decisions. Fundamental analysis is, according to Investopedia, a method of evaluate the intrinsic value of a security by examining "economic, financial and other qualitative and quantitative factors." Learn the method of forecasting future price movements based on the overall economy, industry conditions and other company-specific elements.
- 2). Learn technical analysis to forecast movements in short time frames and for timing entry and exit points. Technical analysis, according to Investopedia, is "a method of evaluating securities by analyzing statistics generated by market activity, such as past prices and volume." Technical analysis doesn't try to explore the reason why a security's price rises or falls, it tries to forecast future trends based on past data of market movement.
- 3). Open a demo account with a stock broker to experience the market and implement your trading strategies. You should trade the practice account as if it was a real account with real money. Many online stock brokerage houses offer free practice accounts for customers. You may also sign up for Wall Street Survivor--the most popular online stock market simulation game.
- 4). Learn how to control your feelings. Psychology plays a vital part in stock trading. As Investopedia has pointed out, "Greed is your worst enemy." Create a trading plan and stick with it. In your plan, you should outline rules to follow. Do not let your emotions get the best of you, and try to follow these rules strictly.
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