Advantages and Disadvantages of Online Trading

Advantages and Disadvantages of Online Trading

Online trading (or Internet trading) is the buying and selling of securities through the Internet, and is fast becoming one of the most popular ways to invest in the stock market. The primary benefit of online share trading is the level of convenience you will be able to enjoy as a trader.

Following are some of the major advantages and disadvantages of online stock trading

Advantages

1) If there is a market opportunity, investors can make a decision and get real time stock trading without having to call or visit the broker's office.
2) It is easy to open and manage your account online.
3) Investors can access their accounts online 24/7.
4) Online trading is secure, and you can make a lot of money if you use it smartly and carefully.
5) Online trading favors active traders who require frequent trades and demand lesser commission rates

Disadvantages

1) Online trading is a risky business and you can always potentially lose money.
2) Sometimes, Internet connection can be a problem or the website itself loads very slow.
3) Investors may incur a loss due to mechanical or platform failures.