In the 2020s, trading has become a very important part of our lives. It’s common practice now not only to save money for the future but also to use it here and now to get additional income. We have no doubts that at least several people you know trade in the financial market.

Do you want to be among those who buy and sell various currencies, stocks, metals? Then this short course is for you. You will discover the instruments the financial market has to offer and will be able to make your first steps in trading.

By the end of these lessons, you will:

In this course, you will meet trader Festus – a beginner, who is also learning how to trade. He will ask his questions and we will provide answers.

Are you ready to become a real trader? Let’s start!

For a start, trading is buying and selling of financial instruments.

We can break these instruments into several categories:       

Trading is actually a very wide sphere. It happens all the time: people and companies constantly exchange different financial assets. You, yourself, have already taken part in this process. When you travel, let’s say, from Europe to Japan, and exchange euros for yens, you actually act in the Forex market. When American firms get pounds for selling things in the UK and then exchange these pounds for dollars, they trade in the Forex market as well.

Online trading is about buying and selling financial instruments with a specific goal of earning money. Traders look for assets that are cheap to buy them and then sell at a higher price. In addition, they can benefit from opening a sell trade if the price of an instrument that they have chosen, for example, EUR/USD currency pair, declines.

When we talk about trading stocks or metals, we don’t mean that traders need to get involved with these assets directly. It’s possible to make trades based on the change in prices, without having a gold bar actually delivered to you or taken from you.

In the picture below, you may see the price chart of gold (XAU/USD) and the levels, at which a trader could have opened and closed their trade.

Many people still think that only people who got financial education and are skilled in mathematics can trade in financial markets. It’s easy to guess where this myth is coming from: if you click on some financial article, you will probably meet words and expressions like “accommodative monetary policy”, “moving averages” and so on. These terms can make you believe that you are not fit for trading. Don’t think like that!

Underneath the terminology, there’s one simple principle that defines trading: you need to make a prediction about whether the price will go up or down.

If you manage to make an accurate forecast, you will be able to earn money. If your forecast is wrong, you will suffer losses. There are various methods you may use for a forecast, and you will need to choose the one(s) that suit(s) you best.

Moreover, with the right education, you will feel easy about the concepts and definitions that seemed confusing at the beginning. This understanding, in turn, will make you a stronger trader. When you gain knowledge, you will be able to make good forecasts more often and, hence, have winning trades. That’s what all traders are aiming at. That’s what you learn how to do in this course!

Every person cares about his or her personal finance. The natural goals are to save money from inflation and increase capital. Trading offers a way to achieve these goals. Many people choose trading can not only as a money-bringing hobby but also as a profession. In both cases, trading is often seen as a way to financial freedom.

Compared with other ways to raise money, trading has the following advantages:

Many things happen in the world. Currencies rise and fall versus each other all the time. Companies release new products and conquer new markets, so their stock prices move up. Gold and oil constantly change in value. You can earn on all these changes by trading. Buy or sell, see the price change and close your trade. Active people make use of their money! 

The logic of trading is quite simple: if you expect the price of gold to increase in a week, you buy gold. If your forecast was correct, in a week you close your trade and cheer at your profit. How exactly does it happen in real life?

You need to open a trading program MetaTrader, click on a ‘new order’, and then choose 'buy'. When you open a trade, you usually have some target price in mind, at which you will take your profit. When the price reaches this point, you end your trade, i.e. close your order.

In one of the next lessons, we’ll see an example of how to open and close trades on each platform. 

Traders who expect the prices to rise are called ‘bulls’, while those who expect a decline are referred to as ‘bears’. A buy trade is also known as a ‘long position’, while sell trade is also called a ‘short’ position.  

It’s not a long list! One thing you already have is access to the Internet. Another necessary thing is a trading platform(s). Getting it/them is also quite simple: you can download the software using the link on the website or in stores (App Store or Google Play). 

MetaTrader is the most popular platform for trading. If you want to use 50 indicators and tools to analyze charts and get the help of expert advisors (EA), this should be your choice. 

FBS Trader is a customized all-in-one trading platform app. It combines such features as:

Congratulations! You’ve passed the first lesson. You are on the way to becoming a trader! Soon we’ll start practicing. In the meantime, let’s do a small revision.

In the next lesson, you will get more information about financial instruments. Keep going!