Working as a freelance trader can be very rewarding and promising.
The stock market offers plenty of moneymaking opportunities to pursue, from stocks you can trade for capital gains to those that pay a lot of dividends in the long run.
As a freelance trader, you can choose to become a day trader or a long-term investor just as easily.
Of course, you will have to know your way around the market and invest in the best stocks available.
Depending on your investment goals – and the type of trader you want to be – this means looking into companies whose stocks are performing well, either in the short run or in the long run.
Here are several great stock investments you can make as a freelance trader.
Dividend Paying Stocks as Foundations
Every good portfolio needs a strong foundation. A long-term investment in companies that pay good dividends is one of the best ways to get started with a career as a freelance trader.
This is the kind of investment that you don’t have to monitor constantly. In fact, you can actually invest in a company and simply forget about it.
There are a number of great investment opportunities in this category.
HSBC is one of the best international banks to invest in if you’re looking for good dividends and a steady level of growth over a period of more than five years. The company pays around 7.3% in dividends to shareholders, making it one of the best companies to invest in.
Another great option is the gambling software maker Playtech who owns companies like Sun Bingo and other online gaming software.
They have managed to reward investors significantly in the not too recent past, paying 8% in dividends to shareholders. Share prices have also been up over 139% in the last five years.
You can also pursue a higher return, albeit in a more volatile market, by looking into Vedanta Resources. It is a mining company based in London whose shares are now trading near the 950.00 GBX level.
The company has been trending this past year, with an expected return of more than 10% per year and dividends of 8.94%.
For a faster-paced action and more earning potentials, you need to look into shares that are traded for daily capital gains. This is what most day traders like to focus on when trading.
You end every day by liquidating every stock you hold for a profit – or a loss – and start the next day fresh.
There is no definitive list of shares that are great if you’re looking for daily profits, but there are a few signs to look for. First of all, most financial service companies are great day-trading stocks to look at.
Banks and other financial institutions are known to have volatile share prices, so investing in them can help you bank your daily profit.
Next, be up to date with the latest news.
Some of the most significant changes in stock prices happen when a big news story hits the market. Fortunately, you can relax while you wait for the scheduled economic announcements or other news; this is among the many beauties of day trading.
Last, but certainly not least, you need to fill the gaps between the two types of investments we talked about earlier. This is what the majority of shares on the market are for.
Energy companies such as Royal Dutch Shell and BP are great names to invest in for mid-term profits.
As long as they perform well on the market, the share prices will continue to go up at a steady rate.
The key to success is knowing when to enter the market – and having a good exit strategy to go along with it.
Be sure to stay tuned for more tips and tricks on becoming a freelance trader here on PF Today.