Baby Steps

Like Bill Murray in "What about Bob?", I've been taking Baby Steps in learning how to trade.

First I started out by opening up an account with Sharebuilder and using their automatic investment plan to buy dividend paying Blue Chips. From there I went on to do some real time trades, still only buying dividend paying stocks, but this time I started buying some small caps that payed dividends.

After a while I realized that it didn't matter if a stock paid a dividend or not as long as I could make a nice profit on the trade. I then got approved for a margin account with Sharebuilder and started learning how to manage my buying power.

From there I went on to read a book about options and got approved for level 1 and level 2 options trading with Sharebuilder. I am of the opinion that Sharebuilder is a great way for the beginner investor/trader to get started and learn the ropes. When I feel that I'm an advanced and knowledgeable trader then I'm going to switch to ThinkOrSwim. I've already started using their desktop software, mainly so that I can use Prophet Charts.

Having some good charting software to use is essential in becoming a good trader. There are trends and patterns that are easily visible if you can use a few basic tools like drawing a trendline or drawing lines of support and resistance. At first I had tried using freestockcharts.com, and it is okay to learn some basic charting techniques, but I like the feel of Prophet Charts much better.