The first step in buying stocks online is opening an account with an online brokerage firm.
The first step in buying stocks online is opening an account with an online brokerage firm. It is important for traders to take the time to choose a reputable broker. Once a trader has chosen a broker, they will be able to log into their account and buy some stocks. Some online brokers used are Scottrade – Etrade – Sharebuilder. Each has their own pros and cons to them.
Ideally, traders will not choose a stock until they do their research. The most successful traders are well aware of how a company stands in the financial world before they make an investment. In the past, people used to rely on their brokers to make these decisions for them. However, the availability of the internet has allowed traders to have more freedom when it comes to picking stocks.
Signing up with a broker is not as easy as it sounds. Most brokerage firms will ask their clients to fill out a long application form before they agree to open an account. Once the application form has been submitted, the broker will conduct a credit check. They will also ask to see a copy of the trader’s identification. As brokers often deal with large amounts of money, they do not want to risk opening an account for someone who has bad credit or has stolen the identity of another person.
Beginner investors should ensure that they are knowledgeable about the stock market before they buy shares. Beginners often get so excited at the thought of trading that they sink their money into any company that looks good. This is not wise as the stock market is very risky. Most financial advisers ask beginners to use a trial software or trade on paper first to make fictional trades before they start using real money. This will help beginners get accustomed to stock market jargon and procedures.
Those who are unsure of whether or not they want to get into the stock market should speak with a financial adviser. The best way to do this is to speak to an investment consultant at a bank. The adviser will speak to the investor about buying stock and other investment options.
If you wish to research stocks and how to trade them on your own, we highly recommend IHUB for trading boards and their excellent ipad / iphone level 2 app. Another great site for market news and events is The Motley Fool. When researching stocks it is best to do your own due diligence. This is a term you will hear over and over again. There are many great books on trading out there. Many are just a click away from Apple’s app store. Read, take notes and research some more. There are many trading styles out there and it’s important to pick which one is best for you. Nothing controls the stock market but fear and greed. It’s a crazy rollercoaster ride that can be fun and profitable.