When the time comes around for your holiday, you will inevitably feel like it has completely crept up on you. People book holidays so far in advance now, it is no wonder they are ill prepared when the time comes. Another factor that doesn’t help is all of the new and innovative ways you can book holidays. The days are gone when you could only go into the travel agent and book ahead and pay each month, and now you can pretty much book a whole holiday without paying much in advance, and pay the rest when you get there. The days leading up to a holiday can now be a stressful scramble for funds, but there are now ways to get extra funds in order without getting yourself in debt. Online trading is one of the best ways to chalk up a bit of extra cash before the big event.
What is online trading?
Online trading is exactly what it sounds like. Gone are the days when you had to go through a financial adviser, a stock broker and a lengthy process just to trade shares. Websites like CMC markets let you log on and trade online in minutes. This may sound daunting, and dabbling your hand in the fast paced stock market may seem like a bad idea when you are trying to make money, but if you take your time to do some learning, and you don’t get greedy, you could pocket yourself some extra cash.
There is also no particular restriction on just trading in stocks and shares. You can put your money into Unit Trusts or OEICS, or any other mutual funds, and you can also take advantage of the opportunity to do some spread betting or trade CFD’s. Spread betting and CFD’s offer a very different way of trading to stocks and shares. Rather than actually owning a stock, you bet either for or against its position in the market.
What do I need to get started?
To trade stocks and shares online to make more money for your holiday, there really isn’t a lot you need to get started. First of all, you will need a laptop or any other computer, and then you will need to register to the online trading website you have chosen to use.
When you register, you will be asked to prove your identity. Most websites will let you do this by scanning in your ID, so you should not send off your originals. IF you do see anything that has been requested of you that you feel is untoward, either contact the company or the Financial Services Authority and report your concerns.
One of the main things people wrongly assume which leads them to not trying online trading, is that they need lots of money to get started. This isn’t the case, as most online trading websites will let you invest a minimum of £50.
Top tips for online trading for extra holiday money
Set up a monthly direct debit and invest a small amount each month, rather than one big lump sum
This is a great way for you to manage an affordable portfolio, and also spread your risk. If you invest a large lump sum of money in one go, you are bound to the price at that time. If you invest monthly, the prices may be bad one month but could be balanced out with a good price the next.
Some of the online trading websites have a practice function where you can get the feel of the trades and the usability of the website. If they do not, and you are completely new to trading, it still may be worth monitoring trades you would of gone for over the period of a couple of weeks before you actually go ahead and place money into real trades.
Sign up to more than one broker
The great thing about online brokers, is they are not exclusive, won’t know if you are using someone else and won’t care as much as your financial adviser. Sign up to a few and spread your risk even more.