Learn to trade (UK): a free guide for beginners.

How do you trade? What trading actually means

Trading means buying or selling something because you think its price may move. A trader has to decide what to trade, when to enter, where to get out if wrong and where to take profit. Writing those decisions down matters more than finding an exciting chart.

There's no need to trade every day. Your first job is to understand the process and the risks. If you can't explain how a trade could lose money, you're not ready to place it.

A simple rule: decide your risk and your exit before entering. A trade can still lose even when the setup looks convincing.

Choose one market to learn

Start with one market so you can learn its vocabulary and behaviour. You can explore others later.

• Gold: shown as XAU/USD, quoted in US dollars per troy ounce. See Gold Basics.
• Forex: currency pairs such as EUR/USD. You trade one currency against another.
• Crypto: digital assets such as Bitcoin. Prices can move sharply, including at weekends.
• Shares: ownership in listed companies. Buying shares is different from trading leveraged share products.

TopTrades FX focuses on gold, but you're welcome in the free community whatever you're learning.

Learn what a chart shows

A price chart plots prices over time. Each candlestick shows the open, high, low and close for its period. A 5-minute candle and a daily candle describe very different spans of time.

Look for the current price, the timeframe, and recent highs and lows. An upward move doesn't mean the next candle must rise too. Draw a few levels you can explain rather than filling the chart with indicators you don't yet understand.

Write a plan before placing an order

Every planned trade needs an entry, a stop loss and a target. A market order fills at the available price; a limit order asks for a specific price or better. A stop loss is an instruction to exit around a chosen level, but fast markets and gaps can give you a worse fill.

Example of a plan, not a trade idea: “I'll only enter if my setup is confirmed. I'll set a stop where the idea is invalid, choose a target in advance, and skip the trade if the potential loss is too large.”

Work out the loss first

Risk is the amount you could lose if the trade goes against you. For example, 1% of a £1,000 account is £10. That's a risk budget, not a suggested stake or a guarantee that losses will stop at exactly £10.

Actual position size depends on the instrument, contract size, entry and stop distance, currency conversion, costs and your provider's rules. Leverage magnifies losses as well as gains. If you can't calculate the possible loss, stay on a demo account while you learn.

Don't increase your size to win back a loss. Decide in advance how much you can tolerate on one trade and across a day.

How to start trading: practise the process

1. Choose one market and timeframe. Learn how its prices are quoted and when it trades.
2. Use a demo account. Practise placing, modifying and closing orders without risking real money.
3. Write your entry and exit rules, including when you'll sit out.
4. Record every practice trade: your reason, planned risk, result and lesson.
5. Review a group of trades. A handful of wins doesn't prove a method works.

Ready for the step-by-step version? See Get Started. To practise the maths on your phone, get the free TopTrades FX app on the App Store (lot size, pip value and risk:reward calculators plus a trading journal), or head back to the TopTrades FX homepage.

Learning to trade in the UK

In the UK, firms offering trading products such as CFDs and spread bets must be authorised by the Financial Conduct Authority (FCA). Before opening any account, check the firm on the FCA Register and read its risk warning. Most retail CFD accounts lose money.

Good trading training for beginners should teach risk management and a written plan first, use a demo account, and never promise profits. Be cautious of courses or mentors that sell guaranteed returns or push you to fund an account quickly.