Recently, I have just started trading with real money on eToro’s trading platform mainly because I want my money to work for me. I don’t like the idea of parking all my savings into a bank account on which I get 0.20% interest per year. Some banks offer more, some offer less, but I believe that with trading I can generate more money if I make wise investment decisions.
I’m aware that in trading there is also the risk of losing money as well. A disclaimer on eToro’s home page states: “CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.”
So for more than one year I’ve been practising on my Virtual Portofolio, which is a feature that eToro has in place where you can trade on the real market but with virtual money, and it’s free. All asset prices are in real time and you can only trade when the markets are open.
So while I was practising on my Virtual Portofolio, in the meantime I’ve been doing research and analysis on companies which are likely to grow and are safe to invest in. I also managed to save some money to make a deposit and start trading for real.
Looking back a year ago when Google stocks were around 800 USD I feel sorry for not investing back then, but I found out that in trading, there is an opportunity to invest every day.
I think it’s kind of cool that eToro has made trading accessible to all of us that do no have any financial training but who can predict the market and invest in what’s trending and potentially make some extra money on the side.
For the time being I do not want trading to be my full time job because I’m still learning and still experimenting. In order to make a living out of trading you need to come up with a strategy, ideally a low risk one and with steady gains.
For instance let’s say that you can live off £1.000 a month. That’s going to pay the bills and rent / mortgage and have some money for food and transportation. Now let’s say that with your strategy you manage to make on average 2% profits each month. 2% profits means that risks are low however the returns are not that big percentage wise. So in order to have profits of £1.000 a month you would have to invest £50.000! Now that’s a lot of money, money I don’t yet have.
If you would like to learn more about eToro, there is a YouTube channel I’m subscribed to and the guy does a great job explaining how eToro works, what is leverage, what is a buy position, what is a sell position and all the basics you need to know. Go check out his YouTube channel, SocialTradingVlog or his website: https://socialtradingvlog.com
By the way, this is not financial advice. I am not financially trained and do not encourage anyone to start trading blindly. Trading is not about flipping coins and hoping that opened trades will do good. Do your own research and decide for yourself if trading is something you would like to do.