Welcome to episode two of the Stock Trading University Podcast!
Today, we confront the simple question: What is trading?
Put simply, trading is the act of exchanging one item for another. At the most basic level, such as under a barter system of trade, I may be willing to trade one of my apples for one of your oranges.
But in today’s sophisticated economic system, it is now much more common to simply exchange money for the things that we want.
In fact, every time you buy something from the store, you are engaged in the act of trading. That is, you are agreeing to exchange (or trade) the money in your pocket for the items that you want or need.
So, in this respect, everyone listening to this podcast has experience with the act of trading.
But this podcast series is not about trading money for mere goods. Instead, it is about trading money for shares of publicly-traded companies, known as stocks, and then eventually trading those stocks back to another investor in exchange for money. (Hopefully, at a higher price than they paid for them.)
Thanks to the advent of modern technology, buying and selling stocks has never been easier. Because it is so simple to buy and sell stocks, many traders have been attracted to the stock market in recent times. Most of these traders buy shares of stock with the hope of selling them later to another buyer at a higher price.
And while all traders in the financial markets are ultimately trying to earn a profit from their trading activity, not all of them use the same trading methods to meet their profit objectives. So on tomorrow’s podcast, we will discuss the three different trading approaches that traders use to profit from the market.
Until then, happy trading!
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