Stock Trading Basics – Trading Factors


Virtually everyone, at least in the developed world, knows at least that the stock market exists, and many make investments therein, with the hopes of making a profit. To be able to do so, however, requires extensive knowledge of how the market works. In this article, we will describe the three kinds of market trading strategies, stock trading basics — what they are and which one works for which market goals.

A brief history

It is hard to believe, but the stock exchange as we know it today is a result of Columbus’s rediscovery of the New World. European businessmen saw that there were vast profits to be made in these new lands, but the amount of money needed to start up was more than any one person could make, so people pooled their funds. The first stock exchange was founded in Antwerp in 1531.

The three basic types of trading strategies

Stock trading strategies fall into several types — market making, trend following, trading the news, arbitrage, trend following and so on — but they can all be grouped into three basic types. These are:

  1. trend following
  2. trend fading
  3. scalping

Each has its own basis and its own advantages in different areas, as the following subsections will indicate.

Trend following

The trend follower bases his investment decisions by analyzing, not the fundamental strength of the businesses, but rather the market prices and use the information thus gathered to take advantage of those moves, either long-, medium- or short-term, that seem to pay out the best rewards. This involves, specifically, a technical analysis — that is, you analyze the market by charting how it performs over time and focus on trends. A large part of such analysis requires the use of computer models to determine the general direction in which the market is moving.

Because they aim to invest in markets that have been performing best, trend followers naturally do not enter the market until after the trend has established itself “properly.” They leave the market if the trend reverses itself. Stock trader Van Tharp talked about trend following in his book Trade Your Way to Financial Freedom.

Trend fading

Trend fading, on the other hand, involves trading against current trends. This is naturally more risk, and so you should not use this strategy unless you have high risk tolerance. The short-term gains are potentially very great and no complex analysis is required.


The word scalping, when used in business, has at least three meanings, one of which implies fraud. Legitimate scalping means attempting to earn many profits on small changes in prices. Such traders choose this strategy because it is easier to track small changes than large ones.

Our trading strategies are powerful and unique in many ways:

  • easy to understand and execute
    Our trading strategies are easy to understand, and you can learn them in less than a day – often even less than one hour. Simple and effective!
  • perfect for beginners
    The stop loss for our trading strategies are between $100 and $200, which makes them perfect for beginners and traders with rather small accounts.
  • a great “add-on” for experienced traders
    Our trading strategies and concepts can easily be combined with other strategies, and therefore they are perfect for experienced traders who are looking for new trading ideas.

We also believe that great trading education should be affordable!

When you invest in our products, you get the kind of education that can best enable you to meet your investment objectives.

Rockwell Trading is a proud member of the Better Business Bureau and has maintained an A+ rating for many years.

Online Stock Trading Basics

Online stock trading is a big business. The advent of the internet and high-speed connectivity have facilitated the expansion of this industry and as a result there are more online brokerages than ever before. Before jumping in, it is worth noting that since this is real money we are working with here (retirement money in many cases), it is important for new investors to thoroughly educate themselves. Luckily, most brokerage firms offer excellent education services.

Types of Online Stock Trading

There are many options for investors to trade and the kind you find attractive depends on many factors. How much capital will you be working with? How much risk are you willing to take? How much time can you afford to dedicate to market research? Consider the following options.

  • Day trading was in its heyday when the internet took off in earnest. Traders buy and sell positions in as close to real time as possible, often capturing gains (or suffering losses) several times a day. Day traders must be willing to invest a lot of time to following the ups and downs of the market and accept a high level of risk.
  • DRIP funds (Dividend Reinvestment Plans) are a good choice for traders that are of a buy-and-hold mindset and for those with limited funds. Not all stocks and bonds participate in this kind of investment plan but many do. The main benefit is that you can invest by a dollar amount rather than a specific number of shares. And when one of your positions pays a dividend, that money is automatically invested back into that position, usually as a portion of a share.
  • Conventional online brokerage firms are very popular with investors with mid to long-term goals but that don’t want to do research every day. You deposit funds into your account and buy and sell shares. Generally, each trade is charged a reasonable commission. These firms typically offer very high quality education and research tools.
  • Binary options trading is what the name suggests—two outcomes are possible. Traders predict the movement of an asset and predict the outcome within a certain period of time and the payout (or loss) is known in advance. With this type of trading it doesn’t matter whether the market is in a bull or bear phase, only the movement matters. Since this kind of trading bears such a similarity to gambling many binary options firms are not allowed to do business in the US.

Types of Investments

There are many types of investments available for trading. Online stock trading is the most common but many economists recommend owning a mixed bag of positions, mainly stocks and bonds. Conventional wisdom has it that stocks do better in a bull market while bonds do better in a bear market so this type of diversification is safer. Keep in mind that some municipal bonds are tax free.

Mutual funds are considered a safer investment strategy as well because these funds hold positions in a mixture of stocks and bonds in a market niche or location. The downside is that you are relying on a fund manager to make the picks for you and you must have confidence in his abilities. Next, index funds hold positions in various indexes and mirror their benchmarks.

Online stock trading can be a lucrative venture but it demands an education in the way the markets operate and investors must be willing to take some degree of risk. It is important to keep this in mind when deciding which types of trading strategies you would like to adopt.

How Does the Stock Market Work

Stock Market 101:

If you wonder how does the stock market work, first think of all the national brand names that you’re already familiar with.

From banks to tech giants to the familiar names you see at malls, many of these corporate entities trade on the stock market. Anyone who has at least a few thousand dollars can open a brokerage account and invest in shares of stock issued by these companies. The goal is to buy and sell shares in these securities and then profit from price fluctuations.

Learning Stock Market Vocabulary

There are many terms to learn before you make your first trade. Here are just some of the most essential terms to understand right away.

  • Ask – the seller’s asking price for a security
  • Bid – the buyer’s offering price for a security
  • Commission – the fee a broker charges for each trade
  • Day Trade – to enter and exit a trade in one session
  • ETF – an Exchange Traded Fund, which can reflect an entire industry sector or group of stocks
  • Limit Order – an order that can only be executed at a specific or better price
  • Market Order – an order that executes at the current market price
  • Short – the technique of selling shares first then covering (buying) them at a lower price
  • Spread – the range between bid and ask prices
  • Stop Loss – a technique for exiting a decliner before losing too much money
  • Volume – the amount of shares being traded either in a security or the overall market

Understanding the Market

The phrase “the market” on financial shows refers to the overall stock market, but it can also sometimes refer to the top Wall Street firms, which are responsible for a high percentage of trades. The leading trading institutions are Goldman Sachs, JP Morgan Chase and Morgan Stanley.

There are hundreds of other smaller financial firms that are considered to be part of Wall Street. It’s helpful to understand that the largest trading firms use the fastest trading software. How does the stock market work? Millions of trades by these big firms and the broader market of investors move prices up, down and sideways.

Stock Price Movement

Not all stocks behave the same way. Some stocks move with the overall market while others are affected by company news, such as earnings reports. The price at which the first trade is executed during any given session is called the opening price. The final trade of the session accounts for the closing price.

The regular weekday session opens at 9:30 am ET and closes at 4 pm ET. Usually the first hour of trading is when many day traders capitalize on the biggest price fluctuations. The final hour of trading typically leads to another surge in volume spearheaded by financial firms. Day traders tend to favor high volume stocks since low volume stocks are less liquid, which can trap you in a position.

Trading strategies are not so much based on hope as they are on an “if then” principle. For example, if the price does what you expect then you hold or take profits, whereas if it doesn’t do what you want then you limit your loss.

Further Trading Knowledge

If you’re still asking yourself how does the stock market work, you can turn to professional traders for help. The reason successful trader Markus Heitkoetter, a former IBM director, created Rockwell Trading in 2005 was to simplify trading and help traders realize their goals. The company helps educate both beginning and experienced traders with valuable tips. Heitkoetter’s trading systems can be easily integrated with other trading systems, in which there are hundreds on the market. 

Rockwell Trading Leaves a Positive Impression on Customers

Founded in 2005, Rockwell Trading specializes in trading strategies that accommodate the beginner as well as supplement the existing strategies of an experienced trader. The company aims to keep trading simple and user-friendly.

To help the novice better understand the world of trading, educational products and services are available. Various educational DVDs and courses on trading can be purchased for under $100, and many other resources are free. All materials provide useful and necessary information that can be applied to individual trading experiences.

The Better Business Bureau (BBB) rates Rockwell Trading with an “A” on a scale from A-F. It has also earned a “5-star excellence” award from Shopper Approved, a third party company that contacts actual customers for useful information about their experiences with the company. Most customers greatly appreciate the strategies geared toward a beginner trader, finding the material “clearly explained and easy to use.”

The company’s CEO, Markus Heitkoetter, built his business on straight-forward, useful information and a simplified approach to trading. One satisfied customer remarked, “I like that Markus doesn’t sugarcoat things. He knows what works and doesn’t.” He has shared his trading strategies on an international level, reaching almost 200 different countries. His trading experience dates back 25 years, and in 2002, he became a full-time professional trader.

The company’s goal is to provide customers with the tools they need to execute day trading strategies that correspond to their personal situation. “Markus and company always provide care and attention and education in each and every product that they offer,” notes another customer. This is because Heitkoetter wants his customers to realize that trading does not have to be intimidating. It just needs to be understood.

Markus also appreciates that people are busy. He aims to keep his products and services focused in order to maximize productivity for customers. One customer states that the “explanation about the product is short and to the point.” His sincere and honest personality puts customers at ease, resulting in experiences that keep them loyal to the company.

Markus Heitkoetter is the driving force behind the company, but his team of experts plays a significant role in the business. With a staff proficient in technical analysis, client relations and trading support, customers can rely on their products and services. While Markus and his team strive first and foremost for exceptional service, their hard work and efforts are geared toward their main goal: customer satisfaction for everyone.

Secret Strategies Of Rockwell Trading

Rockwell Trading, founded by Markus Heitkoetter, in January 2005 is a company that believes in simplifying the complex world of trading. It seeks to help other traders better understand the best strategies used in the current day trading market.

Most people have no clue what day trading is or how to make it into a career. The strategies used by Rockwell are easy to understand and implement. In most cases, traders that invest in Rockwell can learn the strategies in less than one day and begin applying them just as quickly. By registering for some of the courses that Rockwell offers, anyone can begin day trading from their home offices rather than feeling like they are squandering their lives away in the corporate world.

The approach that Rockwell offers is great for those who are just starting out in the trading business. There is minimal loss associated with Rockwell so traders with smaller accounts can complete worry-free transactions. The stop loss for trading strategies is usually between $100 and $200.

Experienced traders can also benefit from the Rockwell strategies. The models offered can easily merge with a trader’s current strategies. This proves helpful when traders are seeking new and innovative trading ideas. Although experienced in day trading, it never hurts to take a refresher course or to seek out new and innovative methods of trading. Just as with any other field of work, day trading will never stop changing or improving. Rockwell is one of the premier innovators to assist in keeping up with the changing times.

The strategies offered by Rockwell are both plentiful and affordable. There are several resources available to assist every type of trader. Training videos, books and online courses are available at reasonable prices. Some educational resources are available free of charge via the Rockwell website, such as the “The Simple Strategy”. This is a free e-book written by the founder that answers every question about day trading.

Mark Heitkoetter offers his experiences and advice in this free download of the book for those who are just starting to trade, or for those who are not exactly sure what day trading consists of. The book goes into detail about trading approaches, which markets to trade and the most commonly-made mistakes. It offers clear and concise entry and exit rules as well as the realistic start up costs and losses of day trading.

Rockwell donates this valuable information because they want to see other traders achieve their goals. Day trading is a vocation that can easily convert into a career. Enjoying life for what it really is instead of missing out because of work is possible. By following the advice presented by Rockwell, anyone can change their lives and career path.

Rockwell Trading awarded the 2014 Austin Award

On October 2, 2014, Rockwell Trading was awarded the 2014 Austin Award. The company was recognized by the Austin Award Program in the Investing category, due to its efforts in transforming the local community in Austin. This is the first time that Rockwell Trading has received the Austin Award.

The Austin Award Program is aimed at recognizing the efforts of businesses in the Austin area, a distinguished program that strives to recognize the efforts made by business owners in changing the lives of people in the Austin area. With the honor of the Austin Award Program, it is possible to recognize those businesses that are uplifting the lives of Austin’s residents. Receiving this award lifts a company’s profile and stamps a mark of credibility in the services it provides.

Established by Markus Heitkoetter, Rockwell Trading has gained recognition for the quality services it provides. The company has grown to become a market leader in the area of trader training. The company’s training programs are designed to fit the needs of modern day trading and are in line with set financial rules and regulations. For the people of Austin, the training programs offered by this company have enabled them to understand the stock market and other financial opportunities with a greater knowledge and breadth.

The training programs offered by Rockwell are designed to fit the needs of a wide array of people. The company targets local as well as national investors. The popularity of training programs offered by this company is often due to the simplicity of the strategies they teach. Most people are scared of investing in the stock market due to the complicated nature of trading strategies. Rockwell designs their training programs in a simple and easy to understand format.

Rockwell courses are ideal for people who have never engaged in trading before. The courses are designed for beginners, and as an add-on for those who have some knowledge in trading. The charges for the courses are also minimal, making them affordable for people of different income levels. What makes this company different is their ability to design their programs to fit the needs of their clients perfectly.

The Austin Award is another feather in Rockwell’s cap. It validates the idea that the company has been doing a good job in the local community. Their focus on improving the lives and businesses of people through trading has led to this recognition, and Rockwell Trading looks forward to providing quality community-focused investor training well into the future.

Markus Heitkoetter and Rockwell Trading

Sometimes it seems that there’s no escaping a life of sixty-hour work weeks in the corporate environment. Many people try numerous alternatives to this norm in order to improve their quality of life in both a financial and personal manner. Some return to school, some relocate, but most end up finding that these strategies do little more than waste time and money. However, Markus Heitkoetter may have a suitable solution for anyone ambitious enough to put in the hard work required.

Rockwell Trading is an organization which focuses on teaching newcomers the art of online trading. Through a carefully crafted and highly revered training course, individuals can properly learn trading in a short amount of time. However, this program isn’t only for newcomers; even experienced traders can learn new strategies and skills to maximize their efficiency when it comes to trading. This program’s reputation speaks for itself, as it has high ratings with numerous accreditation organizations, including the BBB.

A free eBook is available to all who are interested, and those who sign up will have access to a number of helpful materials, including interactive courses, bundles, workshops, and a personal coaching program. The helpful and experienced staff is always easy to contact, meaning that traders will never be alone.

The Member’s Area also features materials that can be useful to intermediate and advanced level traders, including trying and testing new strategies, and adapting to new markets. This program has been tested and adapted in various markets, with multiple techniques to ensure that those who sign up will be getting a complete and comprehensive package to aid them in their quest to pursue trading as a hobby, or as a career.

Some individuals fantasize about escaping their 9-5 desk job in favor of an occupation which grants them more freedom and flexibility. While trading requires dedication and hard work, it can be a rewarding endeavor for those seeking income from a non-traditional means. Unlike the typical corporate workplace, trading allows individuals to be in control of their own earnings and their own profitability. They may set their own limits and improve their own situations as they see fit.

Though the world of online trading can at first seem like everything from a scam to an over-complicated game better left to those with MBAs, the program found at can provide an affordable and easy-to-follow curriculum that will give anyone a guide to online trading, regardless of their level of income, level of skill, or level of skepticism regarding non-traditional income sources.

While everyone who takes part in this type of endeavor won’t become an overnight expert, online trading has proven to be a reliable source of supplementary or primary income for more individuals in today’s world. With economic instability causing traditional jobs to become scarcer, online trading could be a safe and reliable alternative that can prove invaluable for any individual who desires to put the time and hard work.

Markus Heitkoetter and His Achievements in Financial Trading

Markus Heitkoetter is well known for sharing his trading ideas and methods with thousands of traders in more than 196 countries. He has also written two top-selling books about day trading. As Rockwell Trading’s founder and CEO, Heitkoetter is a reputable and well-established expert in everything related to trading, from stocks and options, to forex and interest rates. He often participates as a regular speaker at CMEGroup sponsored events and Trading Expos.

Thousands of websites and major publications across the globe have published many of his articles and videos, but his humble beginnings started 19 years ago, when he traded stocks with the use of point and figure charts taken from published numbers in the newspaper. Over the years, he learned to develop trading systems, and decided to become a professional trader in 2002, leaving his position as a director at IBM.

Heitkoetter is the author of the critically acclaimed, bestselling book, “The Simple Strategy — A Powerful Day Trading Strategy For Trading Futures, Stocks, ETFs and Forex.” In this book, he offers a profitable trading strategy and discusses the day trading strategy trend. Heitkoetter gives readers an easy-to-understand and comprehensive explanation of why this strategy is popular among traders, and how it works. What he aims in writing the book is not to promise immediate trading riches, but to allow traders to use a more favorable and proven strategy. His book has more than a hundred customer reviews on Amazon, garnering a high rating on the site. Many readers have raved about the effective trading strategy offered by Heitkoetter.

Customers say that the book lays out a simple strategy and walks the reader through a clear, step-by-step procedure. The book offers plenty of graphics, and provides a solid strategy for any trader who wants to know a specific, quantified system from a trader’s perspective. With more than a decade of experience under his belt and a vast arsenal of knowledge, Heitkoetter has become a popular name in day trading, as his own trial-and-error experiences have helped him discover the best methods.

For anyone who plans to foray into financial trading, it would help to read these books to get a good idea of how trading works, and to start off properly in the world of investment. Through these books and many other publications, Heitkoetter helps people avoid the common pitfalls associated with trading.