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The best order is:
That way you combine theory and practice from day one.
Usually just 5 to 10 minutes. You fill out the form online and verify your identity. After that you can practise immediately with a demo account. For trading with real money, your account is activated once verification is complete. You can find a step-by-step guide on our broker page.
You can get started with a small account from as little as 100 to 500 dollars. To implement the strategy from the Trading Code cleanly, we recommend 500 to 1,000 dollars. That is an amount for learning and getting into it, not an amount to get rich with.
Important: only trade with money whose loss will not cost you any sleep, and adjust the account size to your personal means.
Very important. The strategies themselves are easy to learn. Whether you apply them consistently is ultimately decided by your psychology, that is, how you deal with greed, fear and losses. That is why you should engage with it as early as possible.
For an in-depth look, our book Trading Psychology by Richard Cohen offers probably the best summary on this topic.
Yes. Most of our readers trade part-time. At the beginning, about 1 hour per day is enough. A setup can stay valid for several hours to several days, so you can implement it flexibly. You do not have to sit in front of the screen permanently.
A proven rule of thumb is: risk only about 1 to 2 percent of your trading capital per trade. That way no single loss can throw you off track, and you stay able to act even after a losing streak.
What decides your long-term success is not the hit rate, but consistent risk management with a good ratio of risk to reward.
Trading refers to the mostly short-term trading of things in order to profit from price changes. Things is first a very general word, but strictly speaking you can also “trade” with everything.
Trading is the oldest business model in the world, where you simply buy cheap and sell expensive.
On this website and in the book, however, we trade exclusively on the stock market with shares or derivatives. Derivatives are securities whose value is derived from another financial instrument such as a stock. This has a few advantages in trading, which we will look at in more detail in the book.
In practice, it is very simple. You click on “Buy” when you believe the price of a share will go up, and you click on “Sell” when you think the price of a share will go down, because you can also profit from falling prices in trading.
The magic is knowing when to click on which button. That’s what you will learn in the Trading Code.
Fortunately, the requirements are very low. No matter what your academic qualifications, appearance, origin, or other training, certificates, or credentials are, none of that matters. On the stock market, we are all the same.
The most successful traders I know are all career changers who developed a passion for trading and only later, after they saw how much money you can make on the stock market, switched to trading “full-time.”
The only things you should bring with you:
Where there is a will, there is a way, Einstein once said so beautifully.
I’ll show you exactly what the path to becoming a successful trader looks like in the Trading Code.
Of course, the decision to try trading ultimately depends on you, but I can share a few of the reasons that make it so special for me:
Trading is risky and very emotional. The feeling of suddenly earning thousands within a few minutes from your computer at home is indescribable. But losses are just as much a part of it, and this mix of highs and lows in the chart is sometimes reflected in your mood as well.
So I think you should be reasonably emotionally stable if you want to become a successful trader.
I would even go so far as to say that keeping your emotions on the stock market under control is one of the most important skills of all. The strategies presented in the book are easy to learn. But if you let yourself be driven by greed or fear, you will struggle to apply them.
You should also only trade with money that you have to spare and whose loss will not cost you any sleep. So if you have no money to spare, trading is not the right thing for you either.
As a beginner in trading, you should start by reading the book “The Trading Code.” In this book, I provide a detailed description of all the steps from theory to executing your first successful trade.
If you have any further questions, feel free to watch the videos in the reader area and contact me for assistance.
Trading offers a scalable income potential, allowing you to start with a small investment and gradually increase your earnings. For instance, you can begin by buying one share and earn around 10 dollars. As you gain experience and confidence, you can scale up by purchasing 100 or 1,000 shares, resulting in higher earnings of 1,000 or even 10,000 dollars, respectively. This presents a significant opportunity for generating a decent income.
However, it’s essential to recognize that making 10,000 dollars a month may not be feasible with a starting capital of just 1,000 dollars. Initially, it’s more realistic to use a smaller capital to learn and gain experience in the trading arena. Over time, with dedication and skill, the possibilities are boundless.
Based on evaluations by leading brokers, most private part-time traders tend to earn between 2,000 to 4,000 dollars per month. Your actual earnings will depend on the time and energy you invest in trading. The more effort you put in, the higher your potential for long-term earnings.
The key to success lies in knowing when to click on which button, and this is exactly what you will learn in the Trading Code. It equips you with the knowledge and skills to make informed trading decisions and potentially maximize your earnings.
This is a common question I get a lot, but providing a specific answer is challenging. Just like learning a new language or sport, the time it takes to become a successful trader varies from person to person.
Personal experiences differ greatly. For example, when I first tried surfing, my analytical thinking from the stock market didn’t help me much with calculating wind and waves. It took time and practice to develop a more intuitive approach.
Trading is similar; some individuals grasp it quickly, while others may require more time to develop their skills. The key is perseverance and not giving up. Regardless of how long it takes, staying committed to your goals is crucial.
Trading offers numerous advantages, and the potential rewards can be significant. So, even if it takes a little longer to achieve success, the benefits of trading make it worthwhile. With dedication and determination, you can reach your trading objectives.
Remember, there is no specific timeframe for success. Embrace the learning process, continuously improve your skills, and stay persistent on your trading journey. In the end, it will pay off, and the rewards will be well worth the effort.
I recommend that you invest at least 1 hour per day at the beginning. This is not a lot, but you will see that you will quickly make progress and will then be happy to invest more time. Of course, it also depends on many different factors, such as your strategy and the markets you want to trade. But 1 hour per day is a good start. Longer-term strategies can also be traded very profitably with one hour per month.
In the book, I provide more detailed information on this topic, but here’s a brief overview:
The most popular trading software among both beginners and professionals is MetaTrader. One of its most impressive features is that it is entirely free to use. Additionally, you can find helpful introductory videos on trading in the reader area.
Under the Broker section you will find a reputable provider that offers MetaTrader free of charge. I currently recommend this specific provider because I personally use their services, allowing me to offer you support and exchange information.
You can easily open a trading account within minutes and begin trading. However, I strongly advise that you first familiarize yourself with the fundamentals and strategies outlined in the Trading Code before diving into active trading.
The term “financial instruments” might sound complex, but it encompasses a wide range of assets that can be traded. In trading, almost anything can be traded, and some people even make extraordinary profits trading items like FIFA or Pokemon cards.
However, for the purpose of this book, our focus will be on shares and indices. Shares represent ownership in companies, while indices reflect the value of a group of shares within a single index. One well-known example is the S&P 500.
In our trading approach, we do not directly buy or sell shares and indices. Instead, we use a financial product known as Contracts for Difference (CFDs). The book explains CFDs in detail, but it’s important to understand that they simplify trading significantly, and you can trade a diverse range of assets. This includes shares, precious metals, food products, cryptocurrencies, and commodities, among others.
No, trading is not akin to gambling. Although the outcome of an individual trade may seem random, successful trading relies on a well-developed strategy and informed decision-making based on thorough analysis and market knowledge. It is not a game of chance, but a disciplined approach that leads to long-term success.
The key distinction between trading and investing lies in their respective time horizons. Trading involves short-term transactions, lasting from a few minutes to a few days or weeks at most. On the other hand, investing typically refers to a long-term approach, spanning years.
Additionally, the objectives differ between the two. Investors anticipate that the value of their investments will appreciate over time, focusing on the potential for long-term growth and returns. In contrast, traders seek to profit from short-term price fluctuations, capitalizing on both rising and falling asset prices.
In summary, trading emphasizes short-term gains through active buying and selling, while investing centres on a long-term outlook for potential growth and increased value in the assets held.
If you are under 18 years old, want to test a new strategy, or are exploring trading software for the first time, a demo account is an excellent choice. It allows you to practice trading with virtual funds and no financial risk.
Demo accounts offer the advantage of opening multiple accounts for free, each with a virtual starting capital, like 100,000 dollars. They provide a risk-free environment to gain familiarity with the trading platform and hone your skills.
However, if you are serious about learning trading and are willing to commit to it, transitioning to a real money account is essential. Even if you start with just a few hundred dollars and make small profits, the experience of real trading is invaluable.
Real money accounts introduce the emotions and challenges that come with trading, such as greed and fear of loss. Learning to manage these emotions and making decisions with real financial consequences are crucial aspects of becoming a successful trader.
A CFD (Contract for Difference) is a financial product that lets you bet on the price movement of an underlying asset such as a share, an index or a commodity, without owning the underlying asset itself. This simplifies trading enormously and you can profit from both rising and falling prices.
Leverage means you can move a larger position with little capital. This increases the potential profits, but to the same extent also the potential losses. That is why consistent risk management is so important.
You go “long” when you bet on rising prices, meaning you buy. You go “short” when you bet on falling prices. This is one of the great advantages of trading: you can make money in both directions, whether the market rises or falls.
A stop-loss is an automatic order that closes your position as soon as a loss you have defined is reached. It limits your risk. A take-profit closes the position automatically as soon as your price target is reached, securing your profit.
Together, they are the heart of good risk management.
Yes. With AvaTrade’s mobile trading app you can follow prices, open and close positions, and set stop-loss levels and price targets. This keeps you flexible on the go.
When trading via MetaTrader there are no classic buy or sell fees like the ones you know from a stock bank. Your main cost is the so-called spread, the small difference between the buy and sell price. This difference is the broker’s compensation.
If you hold a position overnight, a small financing fee (swap) may also apply. For short-term trading within a single day it usually does not matter. The MetaTrader trading software itself is completely free.
A pip or point is the smallest common unit in which a price moves. Instead of in currency amounts, many traders measure their profits and losses in points, because that can be compared independently of position size.
Thinking in points rather than in currency also takes some emotional pressure out of trading and tends to be easier for beginners.
The three most important order types are quickly explained:
In addition, there are the stop-loss and the take-profit, with which you automatically limit your loss and profit. How to use the order types correctly is something you learn in the book.
That depends on the market. European exchanges usually trade during the day, and the US exchanges open in the afternoon European time. Foreign exchange (forex) can be traded almost around the clock on weekdays.
Which exchange is currently open you can see live at any time in our Market Hours. Upcoming important dates can be found in the Trading Calendar.
The book is available on Amazon as an eBook, as a printed book and in some cases as an audiobook. You can find an overview with all the links on our book page.
For beginners with no prior knowledge at all. The book guides you step by step from the basics to your first own strategy and your first trade.
Yes. In addition to the Trading Code, there is the book Trading Psychology by Richard Cohen. It is devoted entirely to the mental side of trading, that is, dealing with greed, fear and losses, and is the ideal complement once you have mastered the strategy.
We recommend and use AvaTrade ourselves. The broker provides the free MetaTrader and accepts customers from many countries. You can find details and a guide on our broker page.
Prices and spreads can differ significantly between brokers. Because we trade at AvaTrade ourselves, you see exactly the same prices as we do. That makes execution easiest and the results most comparable. It also allows us to support you more effectively.
Opening an account takes only 5 to 10 minutes. You can find a simple step-by-step guide on our broker page. For a real money account you must be at least 18 years old. To try things out, you can use a free demo account at any time.
Depositing to your trading account is straightforward via bank transfer, credit card or common online payment methods. By card the funds are usually available immediately; by bank transfer it takes a few business days.
Your money is yours at all times and you can withdraw it. Withdrawals are usually processed within one business day; a few more business days pass until it is credited to your bank account. A fully verified account is required.
No. With the brokers we recommend there is no obligation to make additional payments. This means: you can never lose more than you have in your trading account.
Should the market ever move very quickly and strongly against your position, it is closed automatically as soon as your balance is used up. So it can never happen that you suddenly go into debt or have to add money. Your risk is therefore always clearly limited to the capital you have put in.
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