Anyone can make money on the stock market, shouted the website. Yeah, right, I muttered unconvinced. However, over the last year or so I have discovered that three of my friends have been making extra money on the stock market. Two run their own companies and trade for fun and extra cash and the third has turned it into his main source of income. All three of them are making good money at it.
Impressive, but I am still unconvinced. For a start they are all men – that must mean something I decide, although I can’t imagine why it would make any difference. And I bet they are maths minded, and have more time than me, and are better at technology and … and … and…
Eventually though I have run out of excuses and with a girlfriend in tow I decide to see what this stock market malarkey is all about.
We started by attending an introductory evening with Marcus de Maria from Investment Mastery.
He makes it sound easy – but then he is selling his workshop, so of course he would! However I decide to stop finding reasons why not and, with my friend, we sign up.
First we look at the patterns that shares tend to follow. We learn how to spot trends and how to decide whether a particular stock is following a potentially predictable trend or not. We also learn how to spot potential trades and what we should avoid at all costs.
We are taught three strategies; one for upward trending stocks, another for sideways channelling stocks and a third that actually allows you to make money when a stock is going down. Then we each open a virtual trading account and practice placing some virtual trades. It’s the weekend so I’ll have to wait until Monday to see what happens.
Six weeks later I feel I am actually beginning to get the hang of this and I am starting to see returns, over the next month I average about a 2.5% return – better than any savings account I know!
I have now been virtual trading for three months and I am making virtual money. Not a huge amount, but more than I would if I left it in the bank. But the biggest surprise for me is that I am actually making a profit not a loss.
So it seems that anyone can make money on the stock market after all – even a non maths minded woman with no time and rather average technical skills.
This is the first in a series of occasional blogs that will follow my progress as I attempt to go from complete beginner to competent trader.