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Effect of internet on the STOCK MARKET – what is it?

• Internet stock trading (also known as online stock trading) is nothing but the process by which we can deal in stocks through the medium of the internet.
• It provides an independent, broker-free approach to stock market trading.
• It is a lightning fast process where transactions can be made in a matter of a few seconds, without being at the mercy of the stock broker.  
• Absolutely anyone with an online trading account, an internet connection and some cash to spare can take part in internet stock trading.
• Internet stock trading is gradually becoming immensely popular with the masses of stock traders and novices alike. But it, like any other form of trading, is not without its risks.

Preconditions of internet stock trading

• Gaining stock market knowledge: Internet stock trading literally exposes you to the elements of the stock market. It can be very punishing to trade independently online if you do not have sufficient knowledge of the stock market.  Stock market knowledge can be gained through:
• Books: There are several books available in the market that deal with online stock trading and stock-trading in general. Or, go visit your nearest library. Or you can also find a lot of such books online.
• Television: The idiot box sure comes in handy here! There are several channels dedicated to stock trading.
• Internet: The internet also helps.
• Gaining stock market experience: You must understand that along with stock market knowledge, it is equally important to first acquire first hand stock market experience. This can only be possible when you hire a stock broker. Go ahead and hire one and prepare to be his apprentice. Make all your transactions though your stock broker and observe him carefully. Eventually, maybe in a couple of months, some of your stock broker’s experience and tactics will have rubbed on you. You will then be knowledgeable, experienced and self confident enough to take the plunge into the stock market all alone!
• Having/getting a very reliable internet connection: Even if you have enough knowledge and experience of the stock market and are raring to go the whole nine yards alone, you must also have a sufficiently fast and utterly reliable internet connection. There are several real life instances of people having their internet connection suddenly failing when they are making online transactions. A great many of these unfortunate people have had lasting trouble recovering their money lost due to an unstable internet connection. So, it is absolutely essential to have a reliable internet connection. You should also visit genuine websites where you would get all the good and updated information of the share market.

How to go ahead with internet stock trading once you have the prerequisites?

• Join a group or an affiliation: Once you have acquired the prerequisites of internet stock trading, you can finally make the jump! But also be aware that there will be thousands, if not more, of online traders just like you, waiting to click. So many online players will certainly effect a very quick change in market scenarios. Before you know, the market will have soared or fallen. So the best thing you can do is to get to be an affiliate of an online traders’ group. This will help you to get valuable online advice and your much required support.
• Have a ready backup to your internet connection: You will most certainly encounter technological issues like a slow transaction, heavy online traffic, or a bad server. So the most intelligent thing to do here is to have a backup ready. A backup can be a fixed telephone line, a fax system or even your cell phone.
• Play it safe: Understand that the stock market is one of the riskiest propositions. So play it safe. Start by investing an amount that you can afford to lose. Even if you are gaining, do not increase your stakes significantly.

These are just a few pointers on the effect of internet on the STOCK MARKET.

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