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Course overview
1. Investing in stocks vs. trading share CFDs2. What is the earnings season and how does it affect the price of shares?3. Trading the stock market: So, how does it work?4. Trading on Initial Public Offerings5. Putting your stock-trading strategy into action6. Using risk management in share trading7. Conclusion1. Investing in stocks vs. trading share CFDs
Level
Beginner’s
Time
30 minutes
Quiz
Test your skills
Course summary
How do you trade shares of top technology companies such as Meta, Amazon, Apple, Netflix, and Alphabet? This course will walk you through the basics of trading share CFDs and show you how to start building a trading strategy using key market events like the US Earnings Season and Initial Public Offerings.
While the forex market is the home of currency trading, the stock market allows you to invest in companies. This market is made up of thousands of businesses, such as Apple (AAPL), Facebook (META), Amazon (AMZN), Netflix (NFLX), and Google (GOOG). To invest in a company means owning a "share" of it and becoming a shareholder. Share ownership comes with certain benefits for shareholders, such as dividend payments or a share price rise.
With CFD trading, you can still participate in the stock market without owning the actual stock. Instead of buying shares in a company, you trade on the real-time price movements of the underlying stock.
Although the two terms are often used interchangeably, there are differences between buying a stock and trading on the stock’s price movements:
| Trading (Share CFDs) | Investing (Shares) | |
|---|---|---|
| Ownership | No | Yes |
| Leverage | Yes | No |
| Buy or sell | Both buy and sell | Buy only |
| Shareholder voting rights | No | Yes |
| Dividend payments | Not directly. Long positions receive a dividend adjustment, while short positions are debited equal to the dividend. | Yes |
Trading stocks, bonds, and securities takes place on a stock exchange. Stock exchanges serve as platforms for buying and selling securities issued by publicly traded companies. They provide liquidity to investors and facilitate capital formation for businesses.
Leading exchanges in terms of proceeds worldwide include:
- Nasdaq
- New York Stock Exchange
- Shanghai Stock Exchange
- Hong Kong Exchange
- London Stock Exchange
"Stocks" and "shares"
Although the terms "stocks" and "shares" are often used interchangeably, there are some differences between the two. Buying shares means you own a part of a specific company. The term "stock" is more generic and can refer to ownership in one or multiple companies.
Quiz
1/2
What are the benefits of trading in the stock market?
Select more than 1 answer