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The following article was published in our article directory on February 7, 2012.
Learn more about SpinDistribute Article Distribution System.

STOCKS AND TRADING: A PRIMER

Article Category: Business

Author Name: chickie maxwell

Stocks

Stock trading is the process of buying and/or selling stocks in the exchange floor or online. Stocks are capitals in businesses or financial institutions which are divided into equivalent denominations and gives rise to shares. Trading is the transaction part where stocks move from being put into the market and being acquired by another person or entity. The intermediary component of stock trading can either be a person called the stockbroker or a network of computers. Stock trading is characterized as a fluid venture because profits are calculated in accordance to the amount of buying or selling prices. Below are basic information related to the business of trading stocks.

Stocks have two types: the common stock and the preferred stock. Common stocks are those owned by the public. It is the type of stock usually traded by investors and personal trading account holders. In contrast, preferred stocks are more limited than common stocks but it yields dividends. Dividends are income generated by investing in preferred stocks and are paid out to shareholders.

Stocks have classifications: defensive stocks and cyclical stocks. Defensive stocks fulfill a leveraging function: its value is limited in accordance to consumer use. Utilities are a common example of defensive stocks. In a publicly trading company whose stocks are built upon the food business, its probability of being appraised high is dependent on the consumers using more of its products to increase capital. On the end, cyclical stocks are dependent on market conditions. Examples of cyclical stocks are transportation, energy, communications, and technology. One common quality that makes these cyclical is their dependence on consumer use as affected by financial trends.

Stock Trading

With the surfacing of modern technology, stocks can now be traded in a variety of ways. First, the traditional method of making the trade in the exchange floor still remains as the most popular way of doing it. Second, online trading is gaining popularity among those who trade for entertainment, for additional income or for those who work at home. Third, slowly making its way to the consciousness of the people involved in trading is the stock trading software. The first method is still most preferred because the way of business has been established. The second is chosen for its convenience , and the third method is considered for its simplistic advantage.

When making trades in the stock market, there are options available for an investor or a trader. These options are used to structure profitable trading dealings and can be employed at the same time with the amount of resources involved and the market outlook. In reference to the methods of trading, these can also be done by the trader on the exchange floor, online, or through software. These are as follows:
- Day orders
- Stop orders
- Limit orders
- Market orders
- Stop loss orders
- Sell short orders
- All or None orders
- Bracketed orders
- Trailing stop orders
- Extended Hour orders
- Good till Cancelled orders

About the Author: MyReviewsNow offers information regarding stock trading. To learn more about stock trading, visit our website at MyReviewsNow.net.

Keywords: stock trading

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