Types of investment

A Stock Trader or Stock Investor is a securities professional or firm, who buys and sells securities, such as stocks and bonds. The individuals or firms trading in a principal capacity sometimes call themselves stock traders or simply traders. Many people across the world can call themselves stock traders or part-time stock traders, despite of having another profession in parallel with their regular trading activities in the financial markets. When a stock trader has clients, and acts as a money manager or adviser with the intention of adding value to his clients finances, he is also called a financial manager. In this case, the financial manager could be an independent professional or a large bank corporation employee.

Methodology
They usually need a stock broker, such as a bank or a brokerage firm, as intermediate. Since the spread of the Internet banking, they usually use an Internet connection to manage their own financial portfolios, including ordering the sell/buying orders, set stop losses prices and define buying/selling prices. Using the Internet, specialized software and a personal computer, stock traders make use of technical analysis and fundamental analysis to help them in the decision process. A stock trader utilize also several advising and information resorces based on the Internet and the media, such as financial/business news and data firms (Reuters, Bloomberg, Financial Times, Yahoo! Finance, MSN Money, AFX News, Newratings, Cantos). They exclusively trade on their own behalf, as a principal, investing money on a share or other financial instrument, which they believe will increase in price aiming to sell it later with earnings.

Expenses, costs and risk
Trading activities are not free. First of all, they have a considerably high level of risk and complexity, specially for unwise and unexperient stock investors seeking for a easy way to make some extra money. For the other side, stock traders faces several costs such as commissions, taxes and fees to be paid for the brokerage and other services, like the buying/selling orders placed at the stock exchange. According to each National or State legislation, a large array of fiscal obligations must be respected, and taxes are charged by the State over the transactions and earnings. Beyond this costs, the opportunity costs of money and time, the currency risk, the financial risk, and all the Internet Service Provider, data and news agency services and electricity consumption expenses must be added.