Online Trading Tools

by : leizel harwood

Online Trading Tools

While some investors will be happy with a basic share trading service, online brokers offer a variety of trading tools that can help to maximise gains while minimising losses. The type and availability of these tools will vary between brokers, and in some cases an additional fee may be charged to access more sophisticated features.

You may not use these trading tools initially, but it is still worth taking a look at what's on offer with various brokers. As you gain confidence, it's likely you'll embrace more of these features.

Some of the better trading tools include:

Alerts: Your broker forwards an email or SMS when a nominated stock reaches conditions you've specified. These conditions include the price or trading volume of a share or notice of company announcements.

"At limit" orders: Orders that set a limit for the price you are prepared to buy or sell a share for. For example, you may want to buy a particular stock, but you are only willing to pay a predetermined set price based on your calculation of what the stock is worth.

"At market" orders: A buy or sell trade in which you are prepared to accept the prevailing market price. click here

Conditional orders: Allow investors to set a number of conditions, which if met will trigger a buy or sell order. Useful for maintaining discipline, and trading to a strategy rather than an emotion.

Stop-loss orders: Designed to prevent investors paying too much or receiving too little for a trade.

If you're new to investing it makes sense to start off with the basics.However as you gain confidence and become more experienced with online trading, you may want to broaden your investments beyond shares and units in managed funds to include more sophisticated securities like options, warrants and contracts for difference. Or you may want to expand your horizons to include international share here

While many online brokers offer some of these additional services, only few offer all of them. Do note, though, accessing global markets or trading more complex securities may involve higher rates of brokerage.

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