Even though the market has taken a beating of late, a lot of people still ask me to explain stock market trading. I’m a retired stockbroker who lives with his lovely wife in Miami, Florida. Moving down to Florida was one of the best decisions we ever made. We spend a lot of time playing tennis or on the golf course. We own our own home and we have an active social life. In spite of the fact that we’re just a couple of old fogies, we attend a lot of dinner parties. And it’s at these dinner or cocktail parties that people besiege me with questions about stock market trading.

 Though I’ve been retired for nearly five years now, I still keep an eye the market. I read the Wall Street Journal every morning and subscribe to Barron’s. Sure, being a broker was stressful, but I always found the work interesting and exciting. But nowadays things have changed, and that’s what I tell people. Online investing has made stock market trading easier and more affordable.  Competition between competing firms has caused them to slash commission fees to rock bottom rates. But this isn’t necessarily a good thing.  Stock market trading requires quite a bit of education and experience; and if you go into it expecting to make millions without any effort, you’ll be sorely mistaken.

It comes as no surprise to me that many of the people I talk to at these parties have tried to trade online in the past and lost thousands of dollars doing it. I always try to soothe their bruised egos’ by telling them that stock market trading is hard. Heck, even people with a lifetime of experience make major mistakes and lose millions of dollars doing it. Then I tell them that if they ever want to try their hand at stock market trading again, they should be sure to educate themselves. They should learn everything they can about the equities that interest them and begin trading them in very small quantities. I also tell them to invest conservatively and not take big risks. The secret to online stock market trading is to make lots of little profits that will accumulate over time. Some of them don’t like to hear it, but I let them no the get rich quick scenario is nothing more than wishful thinking. It’s much more likely that you crap out than it is you roll a seven or eleven.