capital needed

How Much Capital Do You Need for Binary Options Trading?

It can be a little confusing to determine how much money you need when trading with binary options.

On one hand, there are brokers who ask for little to no money to sign up with them. Then, you have others that ask for considerable sums so that you can make a greater profit.

This can make you question how much capital you need for binary options trading.

While the answer isn’t straightforward, some of the information below may help to give you a better idea of what you will require:

The “Just Right” Amount

It is important not to think in terms of extremes when deciding on how much capital you will need. Traders tend to start off one of two ways – they either have a lot of money in their account or very little. Both these options can set you up for failure, unfortunately. Take having the bear minimum in your account, for instance. This means that you will only be able to make the smallest investment in your trade.

In return, if the trade ends in the money, you barely make a profit.

If you continue in this manner, you will lose only small amounts but you may gain even less. Therefore, it won’t really make sense to trade at all.

Now let’s look at having a large amount of capital in your account. As you now, there is a certain amount of risk with binary options, and that you will lose money every so often. The more money that there is in your account, the more you will be tempted to trade with and then eventually lose it.

This usually happens when you are chasing losses. As you can see, somewhere in the middle, is your best avenue. Of course, what this middle ground is depends on how much money you have at your disposal.

What is Your Financial Goal?

Before you start trading, consider how much you want to make out of this venture. Of course, it can be difficult to difficult to decide on an absolute number but you should try to come up with a realistic goal. Let’s imagine for a moment that you want to make a thousand dollars by the end of the year. During this time, you hope to place twenty trades.

What you need to factor into this equation is the payout rate of your broker. This will determine how much you stand to gain from any one trade.

It is a good idea to remember that you are likely to lose at least half of the trades that you do place, just to be on the safe side. So, for the sake of argument, let’s say that you have about ten trades to make thousand dollars, with a payout rate of 80 percent.

This will give you a good idea of how much you will need to start with if you hope to meet your goal.

Tailor the Amount as You Go

The truth of the matter is, however, that it can be difficult to pinpoint just how much capital you should start with.

It is only once you have begun trading that you have a better idea of how much you need. Therefore, it is quite alright to either increase or decrease the amount that you initially started with.

You should never trade with more than you can afford, nonetheless. Also, don’t make any drastic changes to the money in your account. Also increase or reduce the money you are trading with slowly.

This should give you an idea of how capital you need for binary options trading. Remember, it varies from trader to trader so you should only use as much money as you are comfortable with.

Binary Trading Course

binaryoptions-courseYou have probably heard that binary options are a good trading avenue for novice traders.

While this is certainly true, you will require the help of a binary trading course to succeed.

Of course, there is also a good chance that you aren’t too familiar with the educational aspect of this trading system.

To make it more simple, here is everything you need regarding binary options trading courses.

Why Is It Important To Learn About Binary Options

The concept of binary options trading is quite easy to grasp. It is more or less to do with figuring out the direction a particular price point will move in within a certain period of time.

What many new traders fail to grasp, however, is that there is actually more to this form of trading.

You’ll have to educate yourself otherwise you will make following mistakes:

  • With binary options, you can’t afford to make a random guess regarding a trade. If you opt for this method, there is a good chance that you will end up losing your money. On the other hand, if you do want to increase your chances of success, you need to make a more educated decision.
  • This is where trading programs come in. They start by teaching you the basics of binary options trading. Then, they teach you how to find relevant information and form an appropriate trading plan with it.
  • Last but not least, these courses explain the various strategies and techniques available and how you should utilize them.

Enrolling in the right educational course means that you get a running start in your trading career. What’s more, it allows you to avoid the most common pitfalls most new traders fall victim to. Thus, it is overall a win-win situation.

Where to Find Binary Options Courses

Now, let’s turn to where you can find trading programs to enroll in.

Here are the best ways to get started with binary options courses:

1) Find The Right Broker

If you haven’t selected a broker yet, you may want to add one more set of criteria to your must-have list. Look for brokers that offer educational courses along with their other services. Now, if you are lucky, the broker will provide these classes for free. Otherwise, you may be expected to pay a small fee or join a trading account that gives you access to these services.

It is important to understand that not all broker educational features are alike. For instance, some will hold actual classes or webinars. Others will provide you with detailed guides to trading practices and strategies. It is up to you to decide what form of learning is best.

2) Go To External Educational Sites

In case the broker you prefer doesn’t have this option, you will need to look elsewhere. Fortunately, there are quite a few options available. Still, you should be aware that not all these curricula are alike. There will be some that are quite useful and others that contain only a limited amount of information. Here is a free course for beginners.

You should also carefully examine any site before joining it as this will make it easier to differentiate between all the options. It is best to stick with those that provide you with the greatest amount of information and other resource materials. Remember, there are a lot of good sites which are also free, so you don’t have to sign up and pay if you don’t want to.

How to Find the Right Binary Options Course

Here are the features you need to look for when looking for a binary options course:

  • Reliable Teachers: one of the first things you will need to look for are teachers who are qualified to teach. This doesn’t mean that they are professional lecturers or professors. Rather, they need to have some kind of background in finance or trading. Essentially, you should be able to trust what the teachers are teaching you.
  • Content: the next thing to consider is the content provided to you by the course. Is it relevant to what you want to know? Furthermore, you should look for a site that will help you grow as a trader. As such, it should contain lessons for both beginners and more experienced traders as well. This way, you can increase the possibility of success with binary options.
  • Structure: then, it is a matter of examining the structure of the lessons. Since you are most likely a novice trader, you are going to require a course that covers the fundamental concepts first. After this, they should gradually build on these concepts as you go further.
  • Different Media: it can be tricky to absorb information through just one method. This is why you will find websites that offer different media sources more helpful. You should consider opting for a course that has lecture videos combined with text for the best results.
  • Testing: you will need to be certain that you actually understand all the concepts you have learned about. This is where testing is applicable. Find a course with a proper testing process so that you can grade yourself and have a better idea about where you stand as a trader.

Important: when choosing a broker, make sure you avoid the scam brokers and programs.

What You Should Learn In Your Binary Options Course

So, after enrolling in a proper trading course, what should you hope to learn? Well, there are a few key concepts you should come away with, regardless of the program you have signed up for.

In general, a good program will teach you about managing your money. It will instruct you on how much money you need to spend on any one trade and also how to minimize your risk. In short, you should be able to learn how to lose the least amount of money while trading.

Furthermore, the right course will train you to identify the optimal trading environment for yourself. In a similar vein, you will also learn about knowing when to take a step back. The entire purpose of any trading course should be to create a safe, yet smart trader.

This is all you need to know about binary options trading courses. With the information provided here, you should be able to select one that is most suitable for you.

Snap Cash Binary Scam

As a binary options trader, you might have come across trading robots meant to automate the trading process. Now, if you are here, you have probably heard about the Snap Cash and are eager to know if it is a binary scam. Unfortunately, it appears that this trading system is a hoax and should not be trusted by traders.

If you want to learn more about how this scam functions and why you should avoid it, take a look at these details below:

What Is Snap Cash Binary?

One of the first things this system does to lure you in is to use an introduction video to outline how Snap Cash actually works. In this video, you will be introduced to Austin Ford, the inventor of the binary options trading system. The creator will give you some information about himself, including the fact that he is a self-taught coder. It doesn’t appear that Ford has much experience in financial trading, however.

Snap Cash Binary is a scam! Use one of the trusted brands instead. Sign up with HighLow

Not to mention, there isn’t any information about an Austin Ford at all. When you research him, there are no links to be found, which further casts doubts on who he is. Also, when watching the video, the main presenter does come across as a paid actor. This can be said for many individuals featured in this video.

You are meant to gain insight into how Snap Cash works in the video. Nevertheless, Ford doesn’t actually give you much detail about how the system works. At one point, he mentions that it is similar to “Snapchat”, the multimedia messaging app. There are no other instructions on how you are meant to use the system.

Overall, here are some of the warning signs to watch out for in this presentation video:

  • Irrelevant and over-promotional shots
  • Sparse information about the product
  • Requests personal information
  • Staged situations
  • False information regarding binary options trading

How Is Snap Cash Binary Supposed to Work?

Now, let’s take a look at how this trading system is meant to work and why this may be a red flag to watch out for. Essentially, this works on two different levels:

The Unlicensed Brokers

As mentioned, this binary options trading system is based on robots and trading signals.

Therefore, you need to sign up with certain brokers to be able to utilize the platform. This is the first obstacle you should be concerned with.

The Snap Cash system will only propose unknown brokers that have no real credibility. Therefore, if you do sign up with them and lose your money, there may be no way to recover it.

The Software

As stated, unless you sign up for the system yourself, you can’t tell how it’s meant to function.

This is because Ford doesn’t offer any real details about it. The only information he does provide is that a trade option will pop up on your phone every so often.

At this point, you will have the choice to either go ahead with the trade or decline it. There is a limited time to make such a decision as it expires shortly. It is uncertain whether you will be offered any other information regarding that particular trade.

It is rather apparent that this isn’t a legitimate system. You are not provided with any solid evidence, and the entire platform seems to be based on a shoddy design. This is further proof that it isn’t a system that you can trust.

False Promises

Perhaps what really stands out about this system is all the promises Ford makes to his subscribers. He boasts about how much money he has made and virtually guarantees that you can do the same as well.

The reason why this comes off as a scam is because the promises aren’t realistic.

See, Ford claims that you can make thousands of dollars in a day. He then goes onto say that you can make more in a week with this app than you can all year working a 9 to 5 job. So why does this appear to be a false promise? Well, binary options are like any other form of trading – it carries a certain level of risk.

This means that at one point or another, you are bound to make a wrong move or trade. You will lose the money you have invested in this trade when this happens. Therefore, it is highly unlikely that you will be able to earn thousands of dollars within a single day. There are many scams like this.

There is also the fact that this platform almost specifically focuses on inexperienced traders. This is because most novice traders don’t understand how binary options are supposed to work and have even less knowledge regarding trading signals. As such, they are the easiest victims for these type of hoaxes.

No Legitimate Attachments

Many binary options traders have become used to the idea of dealing with unlicensed brokers. In fact, you may have used a few yourself. Still, there is a good chance that many of these brokers had a good reputation and were highly regarded in the industry.

The same can’t be said for the brokers put forward by the Snap Cash system. For one thing, none of them are licensed and aren’t overseen by any regulatory agency. Thus, you would find it quite difficult to report them, should something go wrong.

If this weren’t enough, Snap Cash doesn’t really have much credibility either. All the testimonials appear to be fake. The few positive reviews given are fraudulent as well.

They merely talk up the advantages of the system without offering any real insight into the features and functions.

In conclusion, it is apparent that the Snap Cash binary options is a scam. There is no evidence to show how this system is supposed to work or even what you are meant to do as a trader.

Additionally, the ‘founder’ of the system makes outrageous claims that the platform can’t possibly live up to. Therefore, when considering all this information, it is best to stay away from the system due to its malicious intent.

Go here to check out the top rated brokers that are not a scam.

small investment ideas australia

Can I Be A Full Time Binary Options Trader?

Can you really make a living simply by trading in binary options?

Can you just sit at your computer at home on a weekday, refer the charts and your broker and rely exclusively on them to sustain you better than a regular day job? In theory, yes, absolutely.

If you have the right temperament, instinct and timing, you should be able score very well as a full time binary options trader and make a comfortable living from it.It’s the same as in forex trading.

If that happens to be your desired career, we have some information here that you might find useful.

However, bear in mind that it is strictly theoretical. Reality is not so straightforward unfortunately.

What is important to know is that it is not impossible. Therefore, you can pull it off.

The formula for making a profit in the binary options industry is simple, just make the right option so you will land in the money.

However, no one is prepared to tell you that is an easy thing to accomplish. The first step is in being a realist and not being tempted by some candy coated advertising that ultimately leads to the witch’s house where you will be eaten.

Below, we have detailed some helpful information to get you started as a full time trader.

Learn Different Types of the Trade

There are types of trades you can rest your predictions on based on how well you assess the market you are trading in.

The first you will be familiar with – high/low trades, the simplest form. Your objective with this type of trade is to accurately predict whether the price of a certain market be either higher or lower than the strike price before the trade expires. An accurate prediction will yield you a profit while an inaccurate one, a loss.

Next is the touch/no touch option.

Here, you are saying that the price of an asset will be at a certain amount before the time of expiry. You can even claim it the other way around, that the price will not be at a certain level. You can also make a double-touch trade, where you pick two levels and claim the price will hit either of the levels before time.

Finally, there is the boundary option, also referred to as the range option. In this type of trade your prediction is based on whether or not the price of an asset will be within a certain price range at the point of expiry.

Manage Your Money Well

This is imperative if you want to make the grade as a binary options trader.

It is important to remember that despite all your research and all your experience. Trading in binary options is still a risky business and investing too much into a trade can yield a tremendous loss and land you in serious trouble.

Commit just a tiny tiny percentage of your bankroll – we’re talking as tiny as 1 percent here – to get you started in training and later as your knowledge and confidence grows, you are bound to have better luck with larger amounts. Do not let the risk factor climb over 10% at the most.

Going full time on binary options trading can make you a very wealthy man. However, it is indeed a very big decision. After conducting some thorough analysis however, you should have a good idea of whether you should go for it.

Be realistic and pay due respect to the risks involved and be careful not to be in a position where you stand to lose more than you are prepared to.

Small Investment Opportunities in Australia

small investment ideas australiaA considerable number of Australians don’t get involved in investing, largely due to the presumption that this financial venture can be quite costly.

The truth, however, is that there are a number of small investment opportunities in Australia.

Regardless of your current financial situation, you should be able to capitalise on any additional money that you may have. To learn more about these small investment opportunities, see below:

How Much Should You Invest

Now, one of your first questions might be regarding just how much money you should invest.

The answer depends on your current financial situation – you should invest as much as you can afford. So, once you have taken care of your monthly essential bills and paid off your debt, the remaining amount can be put towards your investments.

That being said, there is often a minimum acceptable amount for investments in Australia.

With any investment, there are often start-up and ongoing costs.

These include deposits, brokerage fees, and much more. So, for you to be able to actually make a profit, the amount you invest will need to be higher than all of these costs. So, if you are planning on investing, try to save up at least $500.

You will then have enough capital to make adequate investments and reap financial benefits as well.

Types of Small Investments to Make in Australia

In this section, you will be able to get a picture of all the small investments you can make as an Australian, and have an idea of just how much money you will need for that particular option.

Here are the top 5 small investment ideas in Australia:

1. Stocks

You will be able to get started in the Australian stock market with around $500 in your account. As mentioned before, you shouldn’t try to buy shares for less than this amount as the brokerage fees will negate any profits that you are able to make. Still, you can’t actually go to any broker and hope to buy shares with $500.

What you need, in this instance, is a discount online broker.

These online firms have very low brokerage fees as they offer limited services. Essentially, their main purpose is to place the trades for you and little else. Often, such brokers are best suited to investors who have a little more experience under their belts.

Nonetheless, if you are willing to do your own research and make an effort at educating yourself, you can manage this yourself. Here is our article on how to get into the australian stock market.

Of course, investing in independent stocks, especially with low capital, can be a rather daunting process. In case you are looking for a slightly more profitable avenue, you may want to think about Exchange Traded Funds or ETFs.

2. Dividend Reinvestment Plans

These plans are often known as DRIPs and provide you with a low-fee opportunity to invest in shares and stock in certain companies. Now, it should be noted that not every company has such a plan. The ones that do, however, allow you to automatically reinvest any dividends that you earn to buy more shares from the same organisation.

The reason that this can work for smaller investors is because companies will often offer these in their plans at a discounted share price. Furthermore, by opting for this route, you get to forego any broker’s commissions which will only add to your typical investing costs.

3. ETFs

There are ETFs that allow you to join for as little as $500 while some of the more profitable ones may require up to $1000. Nevertheless, you still get a rather low entry point while also being able to enjoy a number of advantages. The top benefit of ETFs is that you only indirectly have ownership of a particular asset. This is because your investment is pooled with others in the fund and a manager will determine how to direct that money. At the same time, you can easily diversify your portfolio with this option, without having to make any financial moves yourself. In this way, you can protect yourself against a certain level of risk.

Now, with ETFs, it is important to pick the right one, as you will need to beware of transaction fees and other costs associated with this type of investment. So, make it a point to go for one that you can afford, even if you are only choosing to invest between $500 and $1000.

4. REIT

Most investors would love to invest in property. Unfortunately, you often need a considerable amount of money to get involved in the real estate sector. However, this doesn’t have to be something that you have to avoid anymore. This is due to Real Estate Investment Trusts (REIT) where your money is pooled together with other investors. The total is then used to purchase various properties that you can’t afford by yourself.

While real estate can cost you hundreds of thousands of dollars, a REIT typically has a minimum investment of just $500. What’s more, many of the profits of the REIT are paid out as dividends which means that you have a fairly regular income to look forward to. Of course, it is important to understand all aspects of the REIT so you can be certain that you are making the right decision.

5. Opportunities for Up To $3000

Let’s imagine that you can afford to invest between $2500 and $3000 dollars – what are your opportunities then? In this instance, it is largely about how much risk that you are willing to incur when investing your money.

If you want to limit risk as much as possible, then a certificate of deposit (CD), may be a good option for you. This is a promissory note provided to you by a bank. Now, this type of investment is unlikely to yield you high profits as the associated interest rates are rather low. The advantage, however, is that you will not need to be concerned with any kind of loss.

In the event that you are willing to take a chance, there is peer-to-peer lending. As the name suggests, it involves you offering a loan to another individual, on an online platform.

There is a rather handsome interest rate attached to the money that you provide, ensuring that you get a good return on your investment.

Now, as you can imagine, you may stand to lose a lot of money should the borrower default on the loan. This is especially true if you provide an unsecured loan.

It is important that when opting for this opportunity, you only work with a platform that has an Australian financial services license. The platform should also be registered with the Australian Securities and Investment Commission (ASIC) to truly be a reputable P2P lending platform.

Choosing the Right Broker

With many kinds of investments, you are going to require a broker to be able to place trades. Now, when you have only a limited amount of money to invest with, you need to be careful about the broker that you settle on.

This is because, as mentioned above, there can be quite a few costs associated with investing.

Most of these expenses will involve your broker. For instance, they will set the minimum deposit that you can place in your account at any given time, regardless of whether you are trading or not.

Also, it is the broker who will determine just how little you can invest in any trade. Last but not least, it is these individuals who will tell you how much each transaction will cost, every time you buy or sell shares or similar types of investments.

Since you will be investing between $500 and $3000, you should look for what is known as online discount brokers.

These individuals offer incredibly lower prices, making them excellent entry points for virtually any Australian investor. You should, however, understand that these type of brokers will only be involved in placing trades. The rest of the work – including the research – will have to be undertaken by you.

Becoming Successful While Investing with a Smaller Amount

In this section, you will learn some helpful tips and tricks to help turn your initial capital into a much healthier amount:

  • Start Now: when you don’t have a lot of money to spare, it can be tempting to stave off investing until you have accumulated more. Or, you may be reluctant to spend the little extra money that you do have on investments. Well, if you are serious about having enough money to retire with, then it is imperative to begin right away. You are never too young or too old to begin investing. The earlier that you begin, the more profit you will be able to accumulate over the years.
  • Focus on What You Can Afford: it can be tempting to get involved with full-service brokers who can make investing a lot easier. Or, you may want to buy shares from ASX50 companies to reduce risk. Despite being great opportunities, these aren’t necessarily the best options for a small-time investor, at least not in the beginning. This is because you will end up spending a lot of money with very little payoff. So, for the time being, stick with what is within your reach, even if it may not feel like a glamorous choice.
  • Aim for 10 Percent: this article has largely dealt with how you can invest with as little as $500 if this is all that you can afford. The truth is, if you want to make a real impact with your investments, you should try to invest at least 10 percent of your monthly income. Now, this isn’t always possible for first-time investors but it is certainly something that you should strive towards. Try to curb unnecessary spending or find a way to reduce expenses in your life so that you are able to invest this amount without any problem.
  • Reinvest Your Profits: just because you choose not to partake in a DRIP, doesn’t mean that you have to avoid reinvestment. Instead, if you are getting paid dividends on an investment, try to reinvest at least a small portion of that back into the company. If this doesn’t feel like the right financial move, consider using your dividends to invest in another company or sector altogether. Remember, when you invest with a little money, there is a limit on how much you can earn – either in dividends or sales. Nonetheless, the more money you are able to invest, the greater the amount that you can get in return.
  • Understand Terms and Conditions: when investing with a smaller amount, you may find that you don’t have a great deal of financial guidance. This is why it is imperative that you learn as much as you can about any investment that you are about to make. So, whether you are looking to buy shares or invest in an ETF, make certain that you know exactly what you are getting into. You should be aware of all the current and future costs and expenses involved in this endeavor as well. At the same time, have a proper understanding of the risk involved with that particular form of investment.

As you can see, there is no shortage of options if you want to make a small investment in Australia.

With the right information at your fingertips, you can make financial decisions that are suitable for your current situation that will yield impressive results.

The main thing to do, regardless of what income bracket you fall into, is to start making investments now.

How to Get Into the Stock Market as an Australian

how to get into asxGetting into the stock market as an Australian can certainly be an overwhelming decision to make. Many ask: How can I get into the Stock Market as an Australian investor?

The Australian Stock Market is also called ASX or Australian Securities Exchange or simply Australian Stock Exchange.

After all, you probably aren’t aware of too many individuals who have followed this particular financial path.

This is because around 75 percent of the Australian population has never invested in shares. However, if this is something that you are considering, then you have come to the right place. Below, you will find out all that you need to know about getting involved in the stock market, in Australia:

Understanding the Australian Stock Market

Now, the first thing you will need to do before getting into the stock market is to understand how the Australian operation works. To do this, you need to have a better grasp of the major stock exchange platforms. You will quickly realise that it is the Australian Securities Exchange (ASX) is the country’s primary market operator. You can see the markets live here.

It is presumed that over a million trades take place on this exchange every day and that it has a daily turnover of about $5.6 billion. ASX has over 2,200 listed companies on its exchange and it is regularly considered to be amongst the top exchanges in the world.

For the longest time, ASX was the sole player in the Australian stock market but this changed when Chi-X was introduced in 2008. This is an alternative, regulated exchange that offers slightly different services from ASX. Chi-X allows investors the opportunity to buy and sell shares from all of the companies that are listed on the ASX. In addition to this, you can also trade in their own Warrants markets.

However, the caveat is that you can trade with other ASX listed products such as ASX Warrants, XTBs, and ETFs. With Chi-X, the largest daily traded value is over $3.4 billion. It is estimated that around 500,000 trades take place on the exchange on a daily basis.

If this seems to complicated for you, here are a few more investment ideas.

How To Pick an Australian Trading Broker

You can’t get into the stock market as an Australian, unless you have a broker who can place the trades for you.

In Australia, you have two main options when trying to pick a broker – a full-service broker and non-advisory broker.

As the name suggests, full-service brokers are an all-inclusive package. For one thing, they assist you with a detailed financial plan, depending on your current circumstances.

They will also offer advice when you buy or sell securities. Furthermore, they will provide the necessary recommendations and share research that is relevant to your situation. There is a minimum deposit requirement on every broker.

Due to all of the services provided by such brokers, the cost involved is a great deal higher as well.

So, you can expect to pay a higher brokerage fee, around $120 or more, for each transaction.

This avenue is most suitable for investors who are new to the stock market and want to gradually improve their trading capabilities. While full-service brokers can be expensive, they also offer guidance for those who don’t have any previous experience.

Which Trading Broker to Choose?

Non-advisory brokers are simply used to place your trades on the exchange.

Therefore, they don’t offer you any other advantages and will not offer you any advice regarding any trades that you make with them. Since these brokers offer minimal services, their brokerage fee is much lower as well. For instance, here, you can expect to pay around $20 per transaction.

This option works for individuals who have already amassed a considerable amount of knowledge and experience in the stock market and don’t require any assistance. These days, most of the non-advisory brokers can be found online.

If you want to ensure that you are dealing with a regulated broker, then you should check that they are a ‘Participant’ of either ASX or Chi-X. You will then be able to be certain that the broker is regulated by these exchanges and sometimes, the Australian Securities and Investments Commission.

When trying to find an Australian broker, it is important to understand the distinction between a direct broker and the businesses that may be offering to buy or sell shares on your behalf. Understand, there are some agencies that will provide you with advice on how to place trades and will also give you the opportunity to place trades through them. However, if they aren’t a participant in a licensed market, then they can’t make direct trades. Instead, they have to contact a Participant and place your trade with them.

Australian Stock Market – Choosing Your Sectors

Another point that you will need to consider before buying or selling shares on an exchange is which sectors and companies to be involved in. To start with, let’s first discuss the sectors that are available for you to invest in. Currently, the ASX consists of 10 sectors that have been collected from 24 Industry Groups, 68 Industry Sub Groups, and 147 Sub Industry Groups.

In Australia, the sectors are

  • Consumer Discretionary,
  • Energy,
  • Financials,
  • Health Care,
  • Industrials,
  • Information Technology,
  • Materials,
  • Consumer Staples,
  • Telecommunication,
  • and Utilities.

When deciding which sectors to become involved in, it is best to stick to those that you are more familiar with and thus, will have an easier time understanding.

The reason that sectors can be so vital to your trading plan is because they can make it easier for you to become a successful investor. In short, one of the more effective trading methods involves identifying the market trend, figuring out what sectors are performing best, and then determining which stocks to invest in.

Pick The Best Sectors

Identifying the top-performing sectors is a rather straightforward process and can be done with the help of technical analysis.

In fact, selecting the best performing sector is virtually identical to figuring out which stocks are doing well. Of course, there are also a number of financial agencies and sources that will provide you with this information as well.

Over the last few years, the top performing sectors in Australia have been Energy, IT, Materials, Health Care, Consumer Staples, Consumer Discretionary, Property, and Industrials in that order. The ones that are performing the worst are Financials, Utilities, and Telecommunication, respectively.

The key thing to keep in mind when selecting sectors is the importance of diversifying your portfolio.

Here, to reduce the risk involved in the buying and selling of shares, you spread your capital across two or more sectors.

This way, should one sector be negatively impacted, you can still rely on the investments that you have made elsewhere.

Choosing Australian Company Shares to Buy or Sell

brokerOnce you have determined the sectors that you want to focus on, it is time to narrow the search down to the companies that you want to buy shares and stock in. To make the right decision, there are several factors that you will have to think about. This includes the interest rates in Australia, exchange rates, current, and future government policies, and investor sentiment. You should also consider how foreign markets and economies can also affect various businesses.

The two types of companies you will find in the stock market are referred to as blue-chip companies and speculative companies. The blue-chip companies are those that have already been well-established in the marketplace. They consistently perform well and tend to have less risk associated with them. Now, it is relatively simple to identify these companies. You can check the S&P/ASX 50 and S&P/ASX100 to see what the top 50 and top 100 companies in the country are.

The problem, of course, is that these companies’ share prices aren’t attainable for many people, especially those just entering the stock market. Since there is so much faith in the performance of these companies, they are quite sought after. If this isn’t an option for you, then you may want to think about trying your luck with speculative companies.

Speculative Companies on The Australian Stock Exchange

speculative tradersThe speculative companies are those that haven’t been around for too long or who don’t have consistent financial performances to back them up. The main draw with these companies is that the share prices are more affordable and that there is always a chance of handsome returns. This, of course, is accompanied by a rather high level of risk as well.

Among the points to consider when choosing a company to buy shares from, you should think about the potential profit you acquire. This is because there are some companies that offer dividends while others simply provide you with the chance to buy their stock. There are others, still, that offer both opportunities.

You will notice that companies that feature higher up on the ASX list often provide investors with higher dividends. If you are someone who wants a regular income, buying shares and stock in these companies may pay off. Smaller companies are more likely to focus on the growth of the organisation and thus, will invest the profits in their own business. In such instances, you will not be paid dividends.

Education in the Australian Stock Market

Just because you have done your research doesn’t necessarily mean that you are ready to start buying or selling shares yet. There is still a lot of information and techniques that you need to be aware of. Especially if you decide to go with a non-advisory broker.

Fortunately, ASX has a large number of sources that you can check out if you are a beginner or simply eager to learn more. The main website offers everything from online courses to teaching you about brokers. In the online courses, you can learn how to buy and sell shares while also being educated about all aspects of an investment and trade.

There is still one more step to take, however, before joining the stock market. This is to first practice with a trading simulation. With these, you are able to buy and sell shares with virtual money, allowing you to get some much-needed experience. Once you have figured out the ins and outs of the process, you can then make the leap to real-world buying and selling.

How Shares are Taxed in Australia

You need to be informed of how the profits made from buying and selling your shares can be taxed by the Australian government. In the event that you buy and profitably sell your shares, then you will automatically incur the capital gains tax. This is because shares are considered to be an asset.

There is, nevertheless, a silver lining in this situation. If you sell your shares 12 months after you initially acquired them, then you can be afforded the concessional gains tax. This means that your payable capital gains tax is discounted by 50 percent. So, only half of the capital gains is actually added to your assessable income.

Since there is a chance that you will have experienced a capital loss rather than a gain, you will need to report the loss in your income tax return. In this situation, though, you can use the capital loss to reduce a capital gain that you have made. In certain instances, you may be able to carry the loss forward, if you haven’t produced any profits during that particular tax period.

If you are an Australian looking to get into the stock market, you will find all the relevant information in this article. Once you have gleaned the necessary details, it is simply a matter of putting your knowledge to the test. Of course, you should keep in mind that there is always a certain level of risk involved in investing and you should be careful how you buy stock.

Go Markets Australia

GO Markets was founded in 2016 and while it is first and foremost, a Forex trader, it is now also one of the most recognized and reputed binary options brokers in the world. It is based in the Australian financial sector.

Go Markets Australia

The first thing for a binary options trader to know about GO Markets is whether or not it has been licenced by the Australian Securities & Investments Commission or ASIC. After all, being a government regulated broker reassures clients that they are not being scammed. As it turns out, GO Markets has obtained a licence from the ASIC which requires rigid standards to be maintained before issuing one.

Pros

  • 24 hour customer service on weekdays
  • Pay-out ratios up to 80%
  • Low minimum trade of $5
  • Free educational tools
  • Cashback refunds up to $250 AUD

Cons

  • Available in very few languages

Go Markets Platform

Being a Forex broker, GO Markets Australia uses a trading platform based on META Trader 4 which is oriented around more traditional forms of trading. It has since been adapted to facilitate binary options trades as well.

For trading in binary options with GO Markets, you will be required to also download an MT4 plugin called FX Lite for MT4. It can be accessed by using the same login details from your MT4 account.

The binary options trading process is further improved by the inclusion of a widespread range of MT4 trading tools called MT4 Genesis.

gomarkets screenshot
MT4 Genesis Session Map

It also presents freshly designed options like a Session map, Correlation Trader, Sentiment Indicator, Terminal window and Mini Terminal.

The only types of accounts offered by GO Markets are a standard account and a Pro account. The Standard account is for new comers and the Pro is for more experienced traders. Both accounts are identical in standard features.

However, only Pro account holders are entitled to more advanced services like access to MT4 Genesis, VPS, and Autochartist. All traders are open to use the GO Markets Demo account which can be utilized for free along with $100,000 in virtual money.

GO markets enables its binary options traders to know precisely how much they stand to make out of their trades. This is made possible because GO Markets displays the exact pay-out ratio between the trade and return on the trade. This is calculated according to the amount that was initially invested.

GO Markets Minimum Deposit

The minimum requirements of GO Markets are quite simple regarding its range of accounts. New traders have to make an initial deposit of $200 to open a standard account while more experienced traders will be required make an initial deposit of $500 to open their Pro accounts. For new accounts, GO Markets offers a bonus worth 10%. It also offers a $250 refund but that is only for Forex traders.

There is no shortage of methods when it comes to depositing money with GO Markets Australia. The easiest one is to use either your VISA or MasterCard debit or credit cards since the deposit can be processed immediately. If you are a binary options trader in Australia, BPay would be the most commonly used method. If you are not from Australia, a simple wire transfer between banks would do. GO Markets also accepts some third part payment processing companies.

Out of all the licensed and regulated brokers in Australia, the pay-out ratios offered by GO Markets are impressive. On average it is around 75% but for certain assets, it goes as high as 80%.

GO Markets has an impressive customer service setup. There are available to traders from all around the world at all times. They can be contacted via phone or email if assistance is required. There is also a physical office location, which can be quite rare among binary options brokers. All of this only increases the authenticity of this broker and makes it a suitable options for new traders.

GO Markets Broker Alternatives

Plus500 Australia – This broker accepts Australian traders and they have a great reputation.

HighLow – If you are interested in binary options, then highlow is one of the best brokers for AU traders.

Is Go Markets Good or Bad?

All things considered, GO Markets remains a very reputable and reliable binary options trading broker in the Australian financial sector.

It features an advanced trading infrastructure that is immensely beneficial and accessible to clients. Go Markets can execute trades relatively quicker than most of other brokers. It is a good choice to go with as your binary options broker.

20k Investment Ideas Australia

invest 20kDo you have AU$20.000 or more to invest and you are from Australia? We’ve go you covered in this article. We will show you the best 20k investment ideas for new investors.

The entire premise of investing rests on the concept of trying to earn as much profit from the money that you initially invested – this is why most experts would suggest that $20,000 is a good amount to start with. Now, when you do have that amount in hand, your next question may be, how do I invest $20K in Australia?

Luckily Australian investors have a lot of investment choices to choose from.

Well, this article seeks to answer that question and to help you determine the best way to invest your money so you can receive a considerable return. Here is what you need to do:

1. Determine Your Financial Goals

One of the first steps is to take a close look at your current financial situation and then determine your overall goals. This information will make it easier for you to figure out just how much risk you can incur with your investments. Thus, by examining your financial status and understanding where you want to end up, you can identify which investment opportunity is best for you. Let’s take a closer look at this phenomenon.

For instance, are you someone who may need access to money urgently, even though you do have $20,000 to invest? In this scenario, you may not be able to withstand a great deal of risk. This is because if you were to experience a small loss, this would affect your monetary situation, particularly if you required the money for an emergency.

$20k investment ideas australia

On the other hand, if you are someone who does not need to touch your investment money, you can handle some risk. So, look for long-term investments that will allow you to garner considerably higher yields, even though there is some uncertainty involved.

Now, when considering financial goals, you also need to focus on how much money you would like to make within a certain period of time. For instance, if you are relatively young and have a long time until retirement, you can opt for a financial avenue that offers lower yields but also with less risk involved. In the event that you are rather close to your retirement age, it makes sense to invest in higher yield financial structures.

2. Which Type of Australian Investment Ideas Are Right for You?

Once you are a bit clearer on your current and future financial aspirations, it is time to move onto the investment ideas that are best for you. There are a few options available, depending on the type of risk you can accept as well as your preferred return on investment. Here is what they are:

A) The Moderate Risk, High Yield Option

Imagine that you don’t mind experiencing small losses as long as you are likely to get a good return on your investment. Here, you will find that equities such as shares are your best option. Australian shares, in particular, have a history of offering long-term, high yields on your investment. While there may be highs and lows during that period, it is still a great way to multiply your original 20K.

Of course, this does depend on you choosing the right stock, at the right time. So, if you don’t have too much experience in the stock market, it can be helpful to get some guidance in the form of a financial advisor. This is especially true if you are looking to invest most of your savings in shares and stock.

When investing in stocks:

  • you can expect a return per annum that ranges from 4 to 7 percent, and even higher.
  • To enjoy better results, it is important to focus on companies that will do well in the future.
  • You should keep in mind that previous fiscal performances of a company may not have a significant bearing on their future position.

If you don’t want to go through the trouble of choosing the stock yourself, you can invest in an Exchange Traded Fund or ETF. In this instance, your money is pooled together in a fund, along with other investors, and a manager will invest them in various assets. So, the ownership of the asset, here, is indirect. If you want to learn about trading, you can read some trading success stories here.

Although you can make quite a large profit with an ETF, there are also some downsides to consider such as underlying fluctuations and a lack of liquidity. This is why you need to be careful about which fund  you join. Now, to avoid any negative tax implications, you will find it best to opt for an Australian ETF that more or less deals with local investments.

B) The Low Risk, Moderate Yield Option

If you don’t want to incur too much risk but still want a decent return on your investment, then you may want to consider Australian government bonds. These can be traded on the Australian Securities Exchange (ASX) and can be either Exchange-traded Treasury Bonds or Exchange-traded Treasury Indexed Bonds.

With Exchange-traded Treasury Bonds, there is a fixed face value – this is the amount that you will get back once the bond has matured. These will have the same annual interest rate until maturity and this will be payable every six months. Now, the face value for Exchange-traded Treasury Indexed Bonds is adjusted for the movements in the Consumer Price Index (CPI). You will be paid a fixed interest rate that is based on the adjusted face value. The payments will be made on a quarterly basis.

It should be noted that although Exchange-Traded Treasury Bonds are impacted by inflation, Exchange-Traded Treasury Indexed Bonds are not. The main advantage with bonds is that there is little risk involved but you do get paid on a regular basis. However, these may not be the most liquid options as the market value of the bonds will depend on the time that you are attempting to sell the bonds.

C) The Low Risk, Low Yield Option

While investing, there are certain ways to mitigate the level of risk that you are exposed to. Nevertheless, the downside with this option is that there is also a limit on how you can expect as a return. Still, if you are someone who can’t deal with losses or want to have access to your money with little notice, here are the best avenues in Australia for you:

  • First, there are high-yield savings accounts but the name is somewhat deceptive. This is because, when compared to stocks, these accounts don’t actually produce very high yields. They do, however, allow you to earn more interest than traditional deposit savings accounts. The main benefit of high-yield savings accounts is that they keep your money safe so you won’t have to worry about losing it. You could also take a look at vanguard.
  • Then, there are money market accounts – although these may not be the most interesting investment option around, they can offer you some advantages. Much like with high-yield savings accounts, money market accounts provide you with greater financial stability. As such, you can be certain that your money will not disappear at any point. This is especially true if you have around 20K to invest, as these accounts typically require higher minimum deposits to get started with.

These accounts are not just suitable for investors looking for lower levels of risk, they are also right for anyone requiring a more liquid investment option. You will find that, within reason, you are able to withdraw your money from these accounts when needed.

3. What to Consider When Investing 20K – Investment Ideas

As you can imagine, it isn’t enough to just narrow down the type of investment you want to engage in. You will also have to figure out what sectors and industries to focus on, giving you more investment ideas. This is rather significant as it can determine whether or not you can actually turn your initial investment into a long-term profit. You will need to do some research to figure out what these top-performing sectors are.

Often, it is a matter of figuring out what sectors are performing well in your own country. For instance, at the moment, Energy, IT, Materials, and Health Care are the best Australian sectors of the year. Nevertheless, Financials, Utilities, and Telecommunication are at the bottom of the heap. Thus, investing in the better-performing sectors gives you some protection from risk.

Of course, you can’t be certain whether a sector that is currently doing well will continue to do so in the future. Here, you will need to determine how a sector has been performing over a period of time. By looking at these various intervals, you will be able to see whether the performance is increasing or decreasing. Furthermore, you should also be able to make an educated guess regarding the growth or depreciation of the sectors over the next few years.

4. How to Spread Your 20K Around

It has already been mentioned that there is a certain level of risk involved when it comes to investments, especially if you are hoping to make some real gains. This is why investors constantly need to be on the lookout for a way to minimise this level of risk. The most useful way to do this is to diversify your investments.

By doing this, you spread your money across sectors and asset classes. The main concept behind diversification, though, is to invest in assets that perform contrary to one another. This way, if one of your assets are performing poorly, you can be fairly certain that the other set of investments will be making you a profit. You are then able to balance out your losses.

This leads to the question of how you should diversify your portfolio – namely, how much of your 20K should you place with each of your investments? In this situation, there may be a rule of thumb that you can follow, at least to a certain extent. So, subtract your age by 100 and the answer will tell you just how much to invest in at each opportunity. If you need more, here are 50+ passive ideas and examples.

For instance, let’s imagine that you are 30 years old. This gives you:

100 – 30 = 70

This means that you should put around 70 percent of your 20K towards riskier, high yield investments such as stocks.

You could invest the rest of the money in:

  • moderate
  • or low yield, stable options like bonds and savings accounts.

As the numbers show, when you are younger, you can handle more risk as it has time to even out during your lifetime. So, your investments in the high yield investments can offer a better profit. On the other hand, if you can’t afford to lose too much since you are nearing retirement, you need more low-risk investments.

Age is not the only factor. It is also about how much risk you are open to and even how much of your $20,000 you can afford to lose at any given time. If you want a more cautious financial plan, even out your investments between the high and low-yield options.

5. Growing Your Portfolio

Just because you started off investing $20,000, doesn’t mean you should be content with this amount. A good way to continue contributing more and more to your future wealth is by reinvesting any dividends or profits that you make on your initial investments.

As long as you don’t need to utilise these profits straight away, it can be helpful to reinvest them either in the same company or sector or to try another option. After all, the more you are able to invest, the greater your wealth will be by the time you are ready to retire.

In this article we answered the question: how to invest 20k Australia?

This is all you need to know regarding investing 20K in Australia. We’ve shown you the best AU $20k investment ideas we know. So, if you do have this amount saved up, you are now aware of all of the right moves that you need to make to multiply this amount. The only thing left for you to do is to actually start investing.

binary options terminology

Binary Options Brokers with 90% Payout

There are several things that traders need to consider when trying to find the right binary options brokers.

Among these is the payout rate that you can expect to receive from a particular trade. The payout rate is essentially the profit that you can make on the money that you place on a trade.

Of course, this is dependent on whether or not the trade is in the money or not. Also, with most brokers, the payout rate tends to change depending on the binary option type that you have chosen. However, below you will be able to find binary options brokers that have a payout rate of up to 90 percent on certain trades.

MarketsWorld

There are many reasons that traders decide to set up accounts with MarketsWorld.

One of these, however, is certainly that traders are offered 90 percent payout rates if they make in the money trades. In addition to this high payout rate, MarketsWorld also has one of the lowest minimum deposit requirements as well.

You can register for an account with this broker for just $10. Traders are able to choose from a wide variety of assets falling under categories ranging from stocks and forex to commodities. If you are looking to make a large return on your investment, this is the broker for you.

CTOption

CTOption is another binary options broker that offers payout rates that can get as high as 90 percent.

This broker offers an easy to use platform in addition to a 100 percent bonus, dependent on certain terms and conditions. There are also many educational opportunities and assets that traders can choose.

For the privilege of having access to all of this, all you need to do is register for an account and deposit just $250. This really is a great option for brokers who are looking for a user-friendly platform that also offers great returns on investments.

IQ Option

If you have been looking for binary options brokers, you have doubtlessly come across this particular name. Of course, this is due to the incredible reputation that this broker has created for itself.

IQ Option offers all of its traders fantastic assets as well as opportunities. This includes the chance to make back up to 90 percent of the original investment that they placed on a trade. This is not even taking into consideration that you can make up to 50 percent of your deposit back as a bonus.

This broker really is full of advantages.

Finpari

Finpari is often touted as one of the best binary options brokers around. Here is our honest finpari review.

This is because they have infused excellence into every aspect of their service towards their traders. This is including but not limited to the trading platform, the assets, and the contests that they hold each week.

Then there is the possibility of being able to make a 90 percent profit on an in the money trade. This just sweetens the trade. Therefore, if you are looking for great payout rates, Finpari should definitely be on your list of potential brokers.

 

These are some of the best brokers and the payouts that they offer. What you should remember, however, is that not every trade is given this payout rate. This often depends on the asset, the type of trade, and the broker in question.

What Is The Minimum Amount in the Australian Share Market

You don’t need to be a financial expert to get involved in the share market in Australia. The minimum amount you have to invest to buy your first shares on the Australian stock market is often a lot lower than most people think.

Getting Started with ASX Shares

Since buying and selling shares is considered a form of investment, you will need to understand just how it is you can make a profit from them.

minimum investment shares market

Capital return – this is where you buy the shares at one price point and then sell them when the value of the company and shares have increased. Then, there are dividends, which are profits paid out to the investors of the company. You can expect to get paid once or twice a year and the exact amount will depend on the number of shares you own.

Dividends.com has the perfect definition here:

A dividend is defined as a payment made by a corporation to its shareholders. Usually these payouts are made in cash (called “cash dividends”), but sometimes companies will also distribute stock dividends, whereby additional stock shares are distributed to shareholders. Stock dividends are also known as stock splits.

Minimum Amount Needed For The Australian Share Market

Especially if you are a new investor, you will probably want to start out with a lower amount of money.

  • What is the minimum investment in share market – This really depends on what type of trading you prefer. If you want to trade on the stock exchange then the minimum amount to buy shares is $500. But this varies from broker to broker. However you can start with only AU$50, if you like binary options investing. For binary options we recommand Highlow. Here is our honest HighLow review.
  • What is the minimum amount of shares I am able to purchase? – The minimum order size on the ASX is $500 for the first trade. After that you can make lower purchases. This is considered one of the best small investments in Australia. Of course you can buy as many shares as you want as long as the first trade is at least $500 (asx minimum trade).

As you can see the minimum you can invest in stocks is $500, but some brokers like Interactive Brokers require $10.000 minimum to open an account. And this amount goes down to $3000 in case of students.

Now lets see how you can buy and sell shares, even if you are a beginner.

How to invest in shares with little money?

1. The Different Ways You Can Buy Shares

There are four main ways you can buy shares, especially if you are a rookie Australian investor.

  • On market share buying is perhaps the most common avenue as it involves purchasing shares on an exchange. Here, you decide what shares you want to buy and place the order with your broker. Your broker is then obligated to find you the best price available.
  • There are some companies that decide to offer new shares in the market as they are hoping to raise capital. This is known as an initial public offering (IPO) or a float. First of all, you don’t necessarily need a broker to buy these shares. Oftentimes, sending in documentation along with a cheque is sufficient. Furthermore, your investment in a company isn’t guaranteed. For one thing, you may not actually receive the number of shares that you asked for. Or, you may find that the shares have already been sold out. In this case, it may be some time before you get your money back.
  • When investing in a managed fund, however, things are a little different. This is because you don’t actually buy shares from a particular company and therefore, don’t have claims of ownership. With a managed fund, you buy units in a fund that is handled by financial experts. These individuals will pool your money with other investors and then use this money to buy bigger chunks of asset classes or asset funds.
  • Finally, there is the employee share scheme. This is when you are an employee of a particular company and they present you with an opportunity to buy shares in the same organisation. In certain instances, you may be provided with a discounted price.

2. Open a Brokerage Account in Australia

Australian Share MarketMost people prefer to buy shares on market, which means that you will need to open up a brokerage account in order to place trades. So, one of your first tasks will be to find a broker that is suitable for you. Now, in Australia, you have two choices – to opt for an online broker or to go with a full-service broker.

How much minimum money is needed to buy shares? The minimum amount required for share trading can vary from $500 to even $100.000. Of course we will focus on online brokers that require a minimum amount for the Australian stock market.

Online brokers tend to be rather popular with individuals who are only just starting out with the share market. They are also good for people who don’t have a great deal of money to invest. Understand, online brokers typically charge around $15 to $20 a trade. However, they are only involved in the execution aspect of the trade and will not offer recommendations, advice, or any other type of assistance.

Full-service brokers, nonetheless, take a more hands-on approach with their clients. First, they will help you with any paperwork or documentation you will need to complete when getting started. Then, they will provide you with various recommendations about the type of shares that you would invest in. Finally, they will place the trade on your behalf. Due to this wide range of services, however, you can expect such brokers to charge at least $80 per trade.

3. How To Compare Brokers That Require Minimum Investment

Regardless of whether you want an online or full-time stockbroker, there are a few things that you will need to during the selection process. These are as follows:

  • Compare the brokerage fees to ensure that you are getting the best deal possible
  • Understand whether or not there will be ongoing fees attached to the account
  • Know what you can trade and if you can trade shares locally as well as internationally
  • Be aware of the minimum and maximum trade limits imposed on you
  • Check if there are additional educational and research services available and if they cost extra
  • Determine how easy the platform is to use
  • Find out if there are flexible and advanced trading options available

4. Selecting the Shares You Want to Buy

The next step in the process is to narrow down the companies from which you would like to buy shares from. Perhaps the most important piece of advice that you can receive is to buy shares from an industry or sector that you actually understand. After all, when determining when to buy and sell the shares, you will have to go through lots of material associated with that particular sector. This becomes a lot easier for you to do if you have some vested interested in the subject matter.

Typically, though, you will find that there are three main ways to select which shares to buy. They are fundamental analysis, technical analysis, and stockbroker research. Of course, there are some individuals who solely rely on stock tips but this isn’t a reliable method of choosing.

Fundamental analysis requires you to go through the financial statements of a company. This gives you an idea of how the company has been faring in various situations and an indication of how it may perform in the future as well. With technical analysis, you will use various information and analysis tools to understand how the share prices of the company have been performing in the past. Here, you will work under the assumption that these prices will be mimicked in similar situations, in the future.

5. Combine both fundamental and technical analysis

For the best results, combine both fundamental and technical analysis. Alone, you may not be able to get a complete picture of how a particular company is performing. However, when you put both types of information together, you will be able to make a more informed decision. We hope you will share your trading success story with us soon.

In case you don’t want to do all of the work yourself, you can rely on the third option – stockbroker research. Here, it is about creating an account with a stockbroker that offers you access to their research and analysis. Before choosing such individuals, though, you should know what type of analysis the stockbroker is dealing with.

6. Managing Your Portfolio

In between buying and selling your shares, you will need to manage your share investment portfolio. One of the best things you can do to limit the level of risk you are exposed to is to diversify your portfolio. This means investing in companies and sectors that often work inversely proportional to one another. By doing this, you will be able to ensure that at least a portion of your investments will maintain their value at any given time.

Another thing you should do is to take a long-term approach to the shares that you hold. The shares need to appreciate in value so playing the waiting game can be useful to you in the long run. At the same time, you should avoid constantly monitoring your shares as the prices do rise and fall minimally rather frequently.

It is also vital that you comprehend the brokerage fees involved every time you place a trade. This is especially significant if you want to make smaller trades on a regular basis. The cost of these transactions alone can make some of these trades a poor choice. So, always be aware of the cost versus profit of any trade.

7. How to Sell Shares

At some point or another, you will decide that it is time to sell the shares that you hold. Now, if you hold the shares directly – for instance, through a broker, IPO, or employee scheme, then the process is fairly simple. You will need to either contact your broker or place the shares online. It is then a matter of waiting for someone to purchase the shares. As with buying shares, this type of trade also incurs a brokerage fee.

Once you have sold your shares, the title of ownership changes from you to that of the purchaser. This ownership transfer and the settlement of the sale will be completed after two business working days in Australia. This is when the money from the sale will be transferred to your account.

If you don’t own the shares directly but rather, in a managed fund, you will end up selling the units you own. Of course, in a managed fund, there are certain regulations that you are held to. As such, you may incur a withdrawal fee if you sell the unit before a specific time period.

Of course, when selling your shares, you want to take advantage of the rate at which the share value may be increasing or decreasing. Nevertheless, you may also want to think about the tax implications of any given trade. Now, any profits you make from share investment are taxed via the Capital Gains Tax regulation. However, if you sell your shares a year or more after you initially purchased them, you can receive a tax break. This is because you will only have to pay CGT on 50 percent of your profits.

8. Understanding the Types of Orders

As an Australian investor, when you have decided to either buy or sell shares, you will need to place an order. There are several kinds of orders and they each have their uses contingent upon a particular financial situation. The orders typically relied upon are: market orders, limit orders, stop-loss orders, and conditional orders.

Market orders are placed to get the best available price for shares at that particular time in the market. This means that these orders take place quite quickly. The downside, of course, is that the share price can change from the time you have placed the order to when it is actually executed. So, during this time the price may have increased or decreased.

A limit order is set to ensure that you end up with a share price that you find suitable. This means that if you are buying shares, the order will only be executed if they fall to a certain price or go even lower in value. On the other hand, a limit order when selling shares means that the trade will only take place when the price reaches a certain value or goes higher. If neither of these conditions are met, the trade becomes unfulfilled.

A stop-loss order is used when you are selling your shares. This is employed to ensure that your shares are automatically sold if the share prices drop to a certain amount. By doing this, there is a chance to limit how much you could lose, if those share prices continue to decrease.

Should I invest only the minimum on the Australian Stock Exchange?

This is your call. Only you know how much money you have, and how much you are willing to risk. Don’t forget that all types of investments involve some degree of risk.

As you see the minimum investment in shares is around $500 and the minimum share purchase on the asx is not important.

Now you know how to get started, if you are a beginner investor who is eager to try their hand at the share market. The information presented here will be more than enough to teach you how to buy and sell your shares so that you can make a profit.

If this is an area you are interested in, you should definitely take the necessary steps to start trading stock. This is because it is one of the best ways to make a considerable profit, over the course of your lifetime. Below, you will find all of the information you need to get started with buying and selling shares.