Stock trading is the process of buying and selling company shares listed on a stock exchange. The aim is to potentially benefit from price fluctuations, however, of course, all investment or trading contains risk of losses. Stocks are one of the most popular financial instruments traded.
What does it mean to trade a stock? When trading stocks you have the option to purchase shares on a stock exchange. You can also trade derivatives of the underlying asset.
Traders aim to buy shares at low prices, hold them for a certain period of time and then sell them at higher prices. That differentiates stock trading from stock investing, which involves buying and holding shares for the long term.
In this guide, we look at how to trade stocks and some of the stock trading strategies you could use.
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