Trader, according to defining dictionary, is the worker of broker company, bank or other financial structure directly participating in exchange trade. However, most traders in the real life are people, working for themselves and risking only their capital. Traders take special pleasure in the process of trade and profit gaining “from air”.

In the practice of exchange trade one divides hedging and speculation. Hedging is the exchange protection against the unfavorable change in price, based on distinctions in the dynamics of costs of cash commodities and costs of futures contracts for the same commodity or prices on “physical” and futures markets. Stock exchange speculation is the method of profit gaining in the process of exchange futures trade, based on distinctions in the dynamics of costs of futures contracts in time, space and on different types of commodities.

Often the market (stock exchange) company value changes so strongly and so quickly, that there comes the conclusion: the real company value can not change as quickly, as stocks cost changes on stock exchange. It means that in different moments of time a company can be both underestimated and overestimated on a stock exchange concerning its real value. Demand and supply on a stock exchange influence the stocks’ costs very much. High demand can greatly raise the stocks’ costs up, and then buy of stocks at these prices will be unprofitable.

In order to determine in what company IPO to take part, a private investor should foremost estimate the sector attraction to which a company belongs on the whole. It is necessary to define company position on the market additionally, to analyze its key indices by which it is possible to judge work’s success. But it is not enough, as much can depend on time of IPO hold. So, a private investor needs to take into account the amount of offerings on the market in the nearest period of time and company place in this line.

A stock exchange enables to trade securities and other financial instruments, including derivative instruments: options, futures, swaps, swaptions, credit derivatives that, as a rule, are a certain contract. Such things as securities issue, their redemption and other arrangements on change of capital structure, for example, payment of income and dividends are usually carried out there.

The basic problem of novice is that he forgets why actually he came to the market and begins screwing around, having a very indirect relation to the income gaining. It is certainly assumed that a man was going to have some income at the market. If a primary purpose was some other, than it is hard to say, whether a trader is wrong losing money at the stock exchange or vice versa, everything goes according to plan. If, nevertheless, an initial purpose was income gaining, all trader’s activity should be submitted to this purpose, and all surplus desires should be cast aside as interfering with work. And there are lots of such desires. In fact, when business concerns money, one of the strongest psychological stimulants, it is hard to keep sound mind and sound memory. Psychology, however pressed is, finds loopholes and influences on the process of taking decisions.

It is no wonder that traders-beginners, having got to the stock exchange, are guided by ordinary human common logic in taking decisions. This logic is clear and straightforward. The cause entails the effect, and the effect is generated by the reason, and if to know all the reasons, the effects will be obvious; come up and use. And really, every price move has quite specific causes, it is generated by market participants, each of them has the reasons to act just the way he acts. However, the number of participants at the market is actually quite large, and the reasons by which they act so, whether or no remain at times not quite clear even for them. All this leads that the price is moved by an enormous amount of various factors and tracing even the most significant is not always possible. So there will be no difference if we consider that price moves are accidental to a great extent.

Investments into own business are sometimes wasted money, but not investments into bright future. At the minimum, not the investor should work for the business devouring time and resources, but quite the contrary — business should work for the founder, or the shareholder. Does business work badly? Possibly, it is the reason to invest in other, but successfully working companies. And the easiest way to do it at the stock market is to buy stocks of stably developing enterprises.

One can point out two models in man’s activity. They are “job” and “game”. Job is a certain good structured process which result leads to payment, i.e. job is a win-win process where certain employee’s resources (time, mental and physical efforts, and even health) convert into money. Let’s note once again, it is the win-win process, either the risk of loss is rather moderate (money non-receipt) or it is considered as force majeure, that falls out of “job” concept.

Leading stock exchanges or the world:
USA, England, France, Germany, Switzerland, Japan.