Trading and investing, explained step by step

Trading is short-term price direction on gold, silver and the US indices. Investing is owning slices of businesses and collecting dividends for years. They need different accounts, different mindsets and different amounts of screen time. Most people should start by choosing one.

• Write down which outcome you actually want: monthly activity, or a growing long-term pot.
• Accept that neither path pays reliably in week one.

Small accounts do not blow up because of bad entries — they blow up because of oversized positions. Before learning any setup, learn the maximum you may lose on one idea (commonly 1% of the account) and how to size a position so that a wrong answer costs exactly that.

• Decide your per-idea risk in rands and write it on paper.
• Practise calculating position size from stop distance until it is boring.

Stage 1 to 4, demand and supply zones, premium and discount, ATR, invalidation, R-multiple, payout ratio, net yield. Every one of these appears on this site with a plain-language explainer attached.

• Skim the glossary on the Learn page and star anything unclear.

Start wide and narrow down. The higher timeframe decides direction, the mid timeframe decides the area of interest, the low timeframe decides timing. Doing it in the other order is why most beginners feel constantly wrong-footed.

• Each day, note the cycle stage on gold and USA100 on the Day Trading page.
• Write one sentence on why you would be interested, and where the idea would be wrong.

Institutional demand and supply areas are ranges where price previously moved away with force. Treat them as areas of interest with an invalidation level, not magic numbers.

• Mark two zones per instrument and see whether price respects or slices through them.

CPI, FOMC and non-farm payrolls create the volatility that ruins careless positions. Knowing the calendar is often more valuable than another indicator.

• Note the release times in SA time and flat-out avoid new ideas minutes before them.

A journal turns random screen time into feedback. Record the reasoning, the invalidation level, the outcome and one lesson — especially on the ideas you skipped.

• Set up a simple sheet: date, instrument, reasoning, invalidation, outcome, lesson.

Which instruments, which sessions, what has to be true before you act, maximum risk per idea, maximum losses per week, and what you do after two losers in a row.

• Keep the plan visible while you work. If an idea is not in the plan, it is not an idea.

Judge yourself on process adherence, not profit. Twenty journal entries that followed the plan is a better month than one lucky win.

• Score each entry: did I follow the plan, yes or no? Aim for 90% yes before real money.

In parallel, learn how ordinary rands become a portfolio: dividend safety, balance-sheet strength, payout ratios, and the fees, FX and withholding tax that quietly eat returns.

• Work through one example amount in the investing workspace and read the reasoning per company.
• Set a monthly amount you would genuinely not miss.

Brokerage, Strate, securities transfer tax, VAT, FX spread and dividend withholding tax all change what actually lands in your account. Small amounts are hit hardest by fixed costs.

• Compare the cost drag on a R500 purchase versus R5,000 and note the difference.

Live money feels different. Your first live phase exists to test your temperament, not to make money, so use the smallest size your broker allows.

• Trade minimum size for a month. Only increase after 20 plan-following entries.

Review by category: setups that worked, rules broken, sessions that suit you, and instruments that do not. Cut what does not fit rather than adding new tools.

• One page a week. Pick a single behaviour to change for the next week.

Short-term trading and long-term investing should not share a pot. Fund the investing account on a schedule, and never rescue a trading loss with money earmarked for the long term.

• Automate the monthly investing contribution; keep trading capital ring-fenced.