"The whole world is on edge, given situations such as Brexit, corruption and collusion allegations in countries around the world, load shedding, the scholarship debacles in American schools and universities (which saw many a listed company lose market confidence), and other such newsworthy happenings. These have all contributed to the most volatile markets this century. But it's not all bad news," says Daniel Kibel, director and founder of online trading company CM Trading.
"In fact, if you are considering starting to venture into the realm of online trading, now is the time," he says. "With the world in a state of flux, politically and environmentally, this market volatility makes for an exciting and potentially very lucrative trading portfolio.
"While this may be a surprising statement when you witness the political in-fighting and the general political climate not just in SA but the world over, one would think this is the scariest time to invest, given all this perceived uncertainty. It is, in fact, the perfect time to either start or expand your share trading.
"Why? Because market volatility actually provides many opportunities to make a profit, notwithstanding the nail-biting ups and downs, with your portfolio possibly being in the red (meaning your trade may have made a loss) one day, and the next day, being in the green, indicating that your trade has made money.
"Trading is not for the faint-hearted, but by doing research, keeping up with the latest trends, following the news and keeping abreast of current affairs, a rewarding short-term investment could be just a click away. Even thinking ahead can yield rewards by looking at what could be the next big thing, looking at which companies will be making a difference to our future here on earth (electric cars seemed something that sci-fi movies were made of, but here we are), digging deeper and finding out more.
"Expert guidance also helps. For example, imagine if you had invested in Netflix when it was first launched. Even if it had been a small amount, the rewards right now would be huge. However, for many people, the concept of Netflix was just a flash in the pan, something that wasn't going to last and was too far-fetched to warrant much attention; for them, nothing would replace satellite TV or DVDs.
"If you had invested in Netflix in 2002, when it first began trading, that investment could really have paid off. A $1 000 investment would be worth more than $90 000 today; Netflix launched on the stock market at just $15 per share and is now trading at about $366 per share. Which proves my point: keep up but also think ahead. An investment in the right trade is an investment in the future. And with the right advice, assistance and knowledge of markets and trends, your investment ship should be on an even keel.
"A volatile market may also suit a short-term investor," says Kibel. "Although such a market means higher risk, a bold trader can watch as the market changes and observe the highs and lows of a particular stock or commodity. There are many ways to do this: by using chart patterns and other indicators to help to time the fluctuations and make the best profit in a shorter period of time.
"This volatility is also a good time for new investors to dip their toes in the water. For many years South Africans have been left out of the trading loop and it has always been viewed as the playground for the elite and the rich and famous. However, with new technologies and new platforms, the way is clear for just about anybody to give it a try.
"It is now not only for experienced traders but also for the new South African investor. Trading in shares and commodities has mostly been something that has been out of reach for the average South African, but now technology has afforded us a quick and easy way to help the consumer trade effectively, be it on their phone, iPad or PC, all at the touch of a button.
"It is important also to realise that not every trade will be a success, but with training, experience and someone to help you navigate the waters (whether it's a toe or a ship), successful trades can be accomplished. Embrace this change we see in the world; use this volatility to grow your horizons and either start or grow your portfolio.
"Using a reputable company to assist you in your trade is, of course, paramount. In this industry there are many fly-by-night operations. I cannot stress enough the importance of dealing with a solid, transparent company that will provide the trader with all the tools they need to trade responsibly," concludes Kibel.
Anyone wanting to start trading can contact CM Trading on www.cmtrading.com or e-mail info@cmtrading.com.
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