How do I trade stocks? The better question should be how do I trade stocks and make money? First don't buy a stock trading system! Most systems cost a lot of money. You are starting in the hole. You can use this money as trading capital. There is plenty of free information out there to get you started. Then once you understand the basics and have researched the different systems it may be beneficial for you to purchase a system.

Always remember if it is too good to be true it is probably not true!

The key to making money trading is good money management. Cut your losses quickly and let your winners run. Think about it in terms of odds making. If you have 1 to 1 odds that means you can win 1 dollar for every 1 dollar that you bet. That means you need to win 50% of the time to break even.

For example in the game of black jack if you beat the dealer you will win what ever you bet. If you bet a $10 chip. You will win $10 if you beat the dealer. Let's assume you bet $10 for 10 hands(games). You bet a total of $100. If you win 5 games you will win $50 and if you lose 5 games you will lose $50 thus breaking even.

The problem with black jack is that statistically it is impossible to win 50% of the time. A good black jack player may win about 48% over time. That is how the huge casinos are built along the strip!

When you trade stocks you can have the odds in your favor you can be the house. Let's take a look at your game. Trading Stock! However, when you lose for every dollar you bet you are going to lose only $.25. When you win you will win $1 or more. For every 4 times you lose, you only need to be right 1 time.

Ponder this for a while. It is the key to successful stock trading! I will talk about in more next time!