Learn to Trade
Everything you need to understand stock markets, read charts, and build a strategy — from first principles.
Market Basics
A stock represents a fractional ownership stake in a company. When you buy a share, you own a tiny piece of that business and participate in its profits and losses.
Order Types
How you submit an order determines when and at what price your trade executes. Choosing the right order type is critical to getting a good fill.
Executes immediately at the best available price. Simple and reliable for liquid stocks, but you're not guaranteed a specific price.
Best for: liquid large-caps when speed matters more than a few cents.
Only executes at your specified price or better. A buy limit executes at or below your price; a sell limit at or above.
Best for: entering positions at a specific target, avoiding bad fills on volatile stocks.
Becomes a market order when the stock hits your stop price. Automatically exits a losing position to cap your downside.
Best for: protecting gains and limiting losses when you can't watch the market.
Triggered like a stop order but converts to a limit order. Prevents a bad fill on a fast-moving stock — but risks not filling at all.
Best for: volatile stocks where you need downside protection but want price control.
Reading a Stock
A stock's page is packed with data. Here's what the key numbers mean and how to use them.
Portfolio Management
A great portfolio isn't just picking winners — it's managing risk through structure, sizing, and discipline.
Diversification
Spread capital across multiple stocks, sectors, and asset classes. If one position falls 50%, a diversified portfolio might only drop 5%. Rule of thumb: no single position should exceed 10–15% of your total portfolio.
Position Sizing
Decide how much to allocate to each trade based on conviction and risk. The 2% rule: never risk more than 2% of your total portfolio on a single trade. With $10,000, that's $200 max loss per position.
Rebalancing
Over time, winners grow to dominate your portfolio, creating unintended concentration. Rebalancing — selling winners and buying laggards — restores your target allocation. Most investors rebalance quarterly or annually.
Cash Reserve
Keeping 5–20% in cash gives you "dry powder" to buy dips without selling existing positions. During market crashes, cash is your most powerful asset.
Options Trading
Options are contracts that give you the right, but not the obligation, to buy or sell a stock at a fixed price before a specific date. They're powerful — and complex.
The right to buy 100 shares at the strike price before expiry. You buy calls when you're bullish on the stock.
The right to sell 100 shares at the strike price before expiry. You buy puts when you're bearish or want to hedge a long position.
Key Options Concepts
Common Strategies
Risk Management
The traders who survive long-term aren't the ones who pick the most winners — they're the ones who protect their capital when they're wrong.
Never risk more than 2% of your total account on a single trade. Lets you survive 50 consecutive losses before account ruin.
Set a max loss per trade (e.g., 7-8%) and stick to it. Letting a small loss become a large one is the most common beginner mistake.
Don't sell a winner just because it's up 10%. Use trailing stop-losses to ride momentum while protecting profits.
After a loss, the urge to immediately win it back leads to reckless trades. Take a break and stick to your plan.
If you missed the move, wait for a pullback. Buying after a stock is already up 30% in a week is chasing, not trading.
Record every trade: why you entered, your target, your stop, and the outcome. Patterns in your mistakes are worth more than any strategy.
Put it into practice
Start with $10,000 virtual cash. No real money required.