It can be quite nerve-racking the first time you buy stocks with the intent of trading them quickly to make a profit. On the other hand, there are literally millions of people who are earning a full-time living successfully executing live trades on the open markets. From the CSX to the NASDAQ, you operate a business as a full-time stock trader and have a level of success and freedom that isn’t available in many other sectors.
This is what you need to know about trading stocks and how you can operate as a business at the same time.
It’s a Business You Can Start with Minimal Capital
Stocks can be valued at thousands of dollars or fractions of a cent. There is no minimum amount of cash needed to officially start trading stocks as a business entity. So, if you have a spare $50 that you plan to put into your stock trading business, then you can do that. No additional capital is needed. Learn how to buy stocks in Canada with a platform like Wealthsimple before opening your first trading account. With investment advice available and only low-cost fees applicable, you should consider this company if you want your business to have the best chance of turning profits. Choose this type of business if you want to start making money, regardless of starting capital.
Trade Stocks from Home
A lot of businesses end up getting expensive to start up, mainly because of overhead expenses. Whether it’s paying to store your inventory, or renting office space to meet with clients, the majority of businesses can’t totally be operated from home. With trading stocks as a business, your home is probably the best place that you can choose to work. First and foremost, you can secure your internet connection with firewalls, antivirus software, and even a VPN. All transactions will be more secure if you do them from a home network as opposed to heading to a Starbucks or the downtown library. You can work independently, without any customers or selling any type of service by trading stocks from home.
Scaling Up Stock Trading Isn’t Complicated
As you trade more and more and begin feeling more confident in your ability to identify winners, scaling up is probably the next step. With more profits to reinvest, you may begin buying more shares and making stronger plays. Novice stock traders operating as business entities may move from buying and selling stocks to buying options. Margins may be leveraged and moves to entirely new and different markets might be part of your game plan. Increasing the stakes with stock trading is a logical move if you are scaling up your business activities. Soon, you will be investing in stocks that have a much higher buy-in cost and subsequently turning a hefty profit.
Market Research Data is Readily Available
In order to find out where a local clothing manufacturer is getting its fabric in bulk, you might have to do a lot of unconventional research. You could call distributors, search the web, or even send the manufacturer an email. Unlike the endless guessing game that may await you in other sectors, researching the stock market is quite convenient. Listen to quarterly earnings reports meetings, read newspaper articles, and take the advice of financial analysts. Investors frequently visit message boards and have entire websites devoted to trading tips and distributing any research data they have encountered.
Choose and Meet Your Profit Goals with Ease
If you are choosing investing in the stock market as your business platform, then you have to know that you will have lots of freedom associated with meeting your goals. Create a spreadsheet, pull out your calculator, and figure out what your profitability benchmarks are. Do you want to make a certain wage hourly, or do you hope to triple your investment in a year? Are you accounting for the time that gets spent on research and market comparisons? Run down the numbers again and again until your business trading stocks are as profitable as you want them to be.
Various Markets to Invest Into
So, you want to buy stocks in Canada and you are going to start-up a company so that all your trades are on the up and up. You can stick with the CSX and invest in a number of penny stocks that will hopefully pay off in a few months. Alternatively, you can look for a highly-rated ETF on the London Stock Exchange and check back in on your profits on about a year. There are various markets that your business can invest in, so never feel limited to stocks for companies that are based in Canada. Buy gold stocks issued by mining companies in Tanzania, or investing in cryptocurrency mining companies operated out of Texas. Follow the money and invest in any market that promises a good return.
Losses Turn into Valuable Tax Write-Offs
Normally, when you just trade stocks as an individual, if you take a loss then you might as well as have just thrown your money away. Now, when your business takes a loss, then you can reduce your take home profit in the form of a write-off. So, if your total take home profit for the year was $100,000, then you would get taxed on that full amount if you didn’t have any losses. However, if you had losses that totalled up to $20,000, then you would only get taxed on $80,000. You may need an accountant to delve into your unique business tax situation, but your tax liability is guaranteed to be lower when you buy and sell stocks as a business owner.
Choose When You Actively Trade
Consider the life of someone who decides to open a pizzeria. There would be many long hours spent in front of a hot oven, greeting customers, and hopefully, a happy ending that comes with lots of profits. Until a full-time staff made up of trustworthy individuals was hired, a pizzeria owner probably wouldn’t be taking a lot of vacations. In fact, there probably wouldn’t be any days off. Even when the pizzeria was closed, there would still be plenty for you to do. Stock traders choose how much to trade just as easily as they choose when they actively trade. So, if you want to go away for a few days or simply leave your investment alone for a spell, you can.
Grow Your Stock Trading Business Slow or Quickly
Even when the market is down, there are certain companies that generally remain pretty stable. Big name companies like Microsoft and Ford have been traded for years. The more stable a company is, the less likely their stock prices are to go soaring up or tumbling down. Therefore, the strategy that you develop for trading stocks is going to center on whether you are growing your company quickly or slowly. Choose to move faster if you don’t mind taker bigger risks.
Earn Profits as You Learn to Operate a Business
Aside from getting your business entity formally established and getting your initial investment together, there are few other administrative tasks for you to perform on a daily basis. Instead of ensuring that your business is in compliance with maximum occupancy rules, or keeping inventory of stock, your time will be spent on looking for profitable stocks to invest in. Along the way, you will gain great insight into how your business should be structured for maximum tax benefits. You might use your business as a means of gaining access to other financial related businesses and investors. You could join a professional organisation and qualify for discounts on business essentials, such as computers and office supplies. The long story short is that you don’t have to be an expert in business operations to run a business where you trade stocks online.
Work on Your Stock Trading Business in Your Spare Time
Differences in time zones, stock exchanges, and even your work hours might determine how little or how much time you put into your stock trading business. In the time that the markets are not open, you have the ability to research and plan so that your next trades are even stronger. In the end, not even market hours dictate the amount of energy you put into this business – that’s your choice. However, any people who want to run a solid business that will be profitable can get into this business, even if they only have extra time sporadically.
When you establish a business in Canada for the purpose of trading stocks, you receive numerous benefits. And because it is not difficult to establish a company, you don’t have to wait months before you can get your business trading stocks started. Have your initial investment capital ready to invest in any of the world’s stock markets, and use the tools that are on hand to track your money’s movement. Whether you turn a big profit or take a loss, it all comes down to how you run your stock trading business.