What Is Share Trading?

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Stock trading is a business in which you buy and sell stocks. It is also known as share trading and stock investing. A share trader can be a retail investor, a professional stockbroker, or an agent. In addition to trading stocks, you may also hedge your investments. Whatever you do, share trading is a great way to make money.

Share prices are determined by a number of factors, such as the company’s past financial performance and the outlook for future growth. If the goods and services offered by a company are in demand, and the company’s competitors are strong, its share price should increase. This information can be obtained from the company’s annual report, which is usually published on the company’s website. You can also access financial results statements by searching for the company’s name on the ASX website. Be wary of shares that are too cheap; they may not be a good value.

If you want to trade shares, it’s essential to keep good records. You must also decide whether the share trading activities you are undertaking constitute a business. A business includes all your activities that generate an income, including your employment, profession or trade. However, you must be aware that if you’re an employee, you’re not a share trader.

Share trading is not for the faint-hearted. It can be extremely risky and you should only trade with funds you can afford to lose. Using margin loans is only suitable for experienced investors. If you’re just starting out, a low-risk investment strategy, like Dollar-Cost Averaging, can help you manage risk.

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