Hello Guys Complete Newb to trading

[djtriggz]

Hello guys I'm new to trading I've signed up for a account on

share.com and deposited some money i plan to buy and sell shares maybe on a day to day or every couple of days.

I don't know if this is the site i should be using as the fees were £7.50 per trade if i wanted to buy just £20.0 of shares and sell later that day I'm sure it wouldn't be a good way of doing things.

 

[NVP]

hey dude ........in trading managing transactional costs are key to success alongside a robust strategy ........think of how much the stock would have to move to pay you back the buy and sell fees ?

N

 

[timsk]

Hi djtriggz,
Welcome to T2W.

. . . and deposited some money i plan to buy and sell shares maybe on a day to day or every couple of days.

If you're making transactions as frequently as this then, by definition, you're a trader as opposed to an investor. Check out this article for more info' on the various types and styles of trader: What Style of Trader Am I? by Don Dawson.

Although Share.com can be used by traders, it's aimed primarily at investors who are very different to traders in a number of respects. The key difference is their objective which is usually to see growth in a company's share price over time (usually many months to many years) and/or to earn dividend income. Based on these long term objectives, transaction costs aren't as important to them as they are to active traders.

. . . I don't know if this is the site i should be using as the fees were £7.50 per trade if i wanted to buy just £20.0 of shares and sell later that day I'm sure it wouldn't be a good way of doing things.

You're correct - which rather begs the question why you've opened an account with them?!

Broadly speaking, if you're going to be a trader and your activities fit into one of the categories outlined in the article, you must do as NVP advises and do everything possible to minimise your costs. If you're going to trade U.K. equities, then most traders (but not all) will tend to opt for a derivative product such as CFD's so they can avoid paying stamp duty and other costs. If you choose to stick with a direct market access broker (i.e. buy and sell actual shares), you can avoid stamp duty by trading U.S. shares.

There is a way to circumvent many of these issues and trade a variety of markets and instruments at reasonable cost by using a spread betting broker. However, most members will advise you that this isn't really suitable for day trading equities. The reasons are varied, but the main one is that the spreads tend to be wide. Spread betting is appropriate for trading over a time period of a few days to a week or two. To learn more about spread betting and CFDs - check out this FAQ: What are the Pros and Cons of Spread Betting Vs CFDs?
Tim.