Preparation...

People who want to enter this market must always be aware of the risk they are taking. You have to take into account the decline in the condition of a given company and the lower value of the purchased shares. This is influenced by, m.in, the economic situation of the country or internal changes taking place in the company. Investing in shares is also associated with emotions, which can be a bad advisor. So it is worth trying your hand at a demo account first, without putting in funds. Simulators are a good way to gain experience before actually investing. To start profiting, you need to prepare a strategy, follow the quotations and learn to accept losses, as well as give up the operations that generate them. Good awareness of individual products is the key to making well-thought-out decisions and building your own investment portfolio accordingly.

Investing in shares is only one of the options available on the stock market. Others are, m.in, treasury bonds, leveraged certificates, investment certificates, futures or options. Under no circumstances should investing be a random action. In addition to tracking quotations and analyzing forecasts of specialists, it is worth using the tools available on the web to search for the most interesting offers. In addition, Webinar Universe training will help you enter the market. It is also worth remembering that investing in stocks should be only one element of a diversified investment strategy. Portfolio diversification is one of the ways to reduce the risk of incurring costly losses.

A simple journal or taking notes with ideas and reasons why you bought a given stock will help to control the investment process. A summary of the results of the actions taken cyclically allows you to objectively estimate whether the methods used so far bring satisfactory results, or whether it is better to make some changes in your approach.

Fees and commissions – how to understand them

Buying and selling shares is associated not only with the possibility of loss or profit, but also with various transaction costs. The broker charges fees for an order to buy or sell shares, which you need to consider when investing. Fees and commissions will vary depending on the specific company and the value of the order. Usually, the commission is a few percent of the transaction value, but you also have to take into account additional costs related to maintaining the account or taxes.

When choosing a broker, it is worth paying attention to the amount of fees, available investment options, as well as the ability to easily and intuitively place orders to buy and sell shares. Investing in shares of listed companies is not extremely expensive, because the basic versions of accounts are usually offered and maintained free of charge or for an amount of several dozen zlotys per year. Additional costs may be related to access to information services or extensive order book functions. The simplest package will almost certainly be enough for a novice investor.

Profit and loss calculations

Every investor must be aware that they can incur losses. In addition, everyone has a different definition of success. Everyone has their own individual level of profit that they assume when entering into a given investment. In general, success can be called achieving a balance of profits and losses after taking into account transaction costs and taxes at a level higher than the fees incurred. The success threshold will also vary over time. An investor should have all areas related to profit and loss under control. It can be said that the moment of sale is more crucial for success and determines possible losses and their size. To calculate the profit or loss for a long trade, you can use the following formula:

PL = S M (Ec / E0 – 1) – C , where:

• PL is profit or loss
• S is the investment amount
• M is the multiplier value used
• Ec is the closing price
• Eо is the opening price
• C is the commission charged per transaction.

To calculate the profit or loss for a short trade, it is useful to use the following formula:

PL = S M ( 1- Ec / E0) – C.

According to the formula, if someone sells shares at a higher price than they bought (taking into account the commissions paid), they make a profit, while if they sell them cheaper, they incur a loss. If he holds shares whose current market price is much lower than their purchase price, he becomes a long-term investor.

Withdrawal from your account and safe exit

Funds in a cash account at a brokerage house can be withdrawn at any time. Usually, the withdrawal is done through a transfer to the bank account provided by the investor. In such a case, a transfer order should be placed, and the money should appear on the account the next day at the latest. In some brokerage houses, it is also possible to withdraw cash in their own branches, but this may involve an additional commission, and in the case of larger amounts, it must be notified in advance. It is also worth reading a detailed description of the brokerage services offered by a given bank. Usually, banks have their own guides on withdrawing funds from the exchange.

Investing in stocks is a complex process that requires careful preparation, cost awareness, and the ability to manage profits and losses. All of this can be obtained on a training platform such as Webinar Universe.