Buying and selling shares on line
Your investments are not guaranteed; they can decrease in value as well as increase and you may not get back the full amount you put in. A share's a unit of ownership in a company. To work out the value of a share, you divide the value of a company by the number of shares available. It's important to understand this when you're choosing the best shares to buy.
How Online Trading Works
With an online brokerage account, buying and sell shares is as easy or easier than most other tasks you perform online, such as updating social media or buying a book. The brokerage firms make it as easy as possible to trade stocks so they can rake in the commissions. The challenges in the stock market include picking from the thousands of available stocks and exchange-traded funds and deciding what type of investor you want to be.
To buy and sell shares, you need a stock brokerage account. After selecting one of the available online brokers, you complete an account application and arrange for money to be deposited into the account. The broker's website will walk you through the process. As soon as your account shows a cash balance from your deposit, you can start to buy shares. For help selecting which broker is best for you, "Smart Money" magazine publishes -- both paper and online -- an annual review and ranking of the different brokers.
The act of buying or selling stock shares is called placing a trade or order. The first step is to find the stock symbol of the company you want to invest in. The quote screen of your online brokerage account will reveal the one- to four-letter symbol when you enter the name of a company. You then select the stock trading screen of your brokerage account.
To buy at the current share price, you enter the stock symbol and number of shares you want to buy, select market order and enter or submit the trade. The shares will be purchased at the current share price in the market. Selling shares works the same way with a sell order instead of a buy if you already have the shares in your account. Only submit your buy and sell orders during the hours the stock exchanges are open. Each time you buy or sell shares, the broker will charge a flat rate commission.
When you place an order to buy or sell, the broker submits the order into the stock exchange and the share price at which the order is filled will be the stock's value at that particular time in the trading day. Although the steps to buy or sell stocks through an online account are pretty easy, you can sell and buy in other ways that make the job more complex -- and can make the profits higher. A margin brokerage account lets you get a loan from your broker to cover part of the cost of buying shares.
However, margin rules can force you to deposit more money in your account if the stocks you buy drop in value. Limit and stop-loss orders allow you to set the share price at which you will buy and sell.
These orders are automatically triggered and filled when the stock reaches the prices you set. When you start to buy and sell shares, you'll learn the difference between investing in stocks and trading. An investor buys stocks because she likes the company as a long-term investment. An investor holds onto a stock until the reason she bought is no longer valid or she found another investment that has more potential. A trader buys and sells shares with short-term holding periods -- sometimes less than a day -- in the quest of high profits.
A trader is usually more interested in price action than in the actual underlying business behind a stock. Tim Plaehn has been writing financial, investment and trading articles and blogs since His work has appeared online at Seeking Alpha, Marketwatch. Plaehn has a bachelor's degree in mathematics from the U. Air Force Academy. You can buy or sell shares with an online account. Open a Brokerage Account To buy and sell shares, you need a stock brokerage account.
Making a Trade The act of buying or selling stock shares is called placing a trade or order. What It Costs Each time you buy or sell shares, the broker will charge a flat rate commission.
Ratcheting up the Compexity Although the steps to buy or sell stocks through an online account are pretty easy, you can sell and buy in other ways that make the job more complex -- and can make the profits higher. Investing or Trading When you start to buy and sell shares, you'll learn the difference between investing in stocks and trading. Video of the Day. Brought to you by Sapling. About the Author Tim Plaehn has been writing financial, investment and trading articles and blogs since How to Sell Stocks on E-Trade.
How Does Buying Stocks Work? How to Buy Stocks Pre-Market. How the Stock Market Works. More Articles You'll Love. How to Buy Index Stocks. How to Invest Your Money in Shares.
Buy EU, UK & US Shares With Regulated Share Dealing Accounts. Compare & Choose Yours! Find Invest Stock Market Online. Search Faster, Better & Smarter at ZapMeta Now!
Legend has it that Joseph Kennedy sold all the stock he owned the day before "Black Thursday," the start of the catastrophic stock market crash. Many investors suffered enormous losses in the crash, which became one of the hallmarks of the Great Depression. What made Kennedy sell?
Many individuals and entities that buy stock market assets do so in order to become shareholders.
With an online brokerage account, buying and sell shares is as easy or easier than most other tasks you perform online, such as updating social media or buying a book. The brokerage firms make it as easy as possible to trade stocks so they can rake in the commissions.
How Does Buying & Selling Shares Work?
Online Share Trading is an easy and cost-effective way to buy and sell New Zealand and Australian shares. It provides online tools so you can place your own buy and sell orders and track their status through to completion. You can even execute more advanced order types, like stop loss sells and target buys. This guide will walk you through the basics of making your first few trades online, together with your options if you want to make any changes to an order. Online Share Trading allows you to place a number of different types of orders and instructions.
How to Buy and Sell Stocks on Your Own
You can set up an account by depositing cash or stocks in a brokerage account. If you prefer buying and selling stocks online, you can use sites like E-Trade or Ameritrade. Those are just two of the most well-known electronic brokerages, but many large firms have online options as well. The broker executes the trade on the your behalf. In turn, he or she earns a commission, normally several cents per share. Online trading sites typically charge lower commission fees, because most of the trading is done electronically. A limit order is when you request to buy a stock at a limited price. While purchasing stocks through a broker has its advantages, there are other ways to buy stock. You can purchase stocks directly through the company.
In order to buy stocks , you need the assistance of a stockbroker since you cannot usually just call up a company and ask to buy their stock on your own.
Ready to contribute more money to your American Funds account? Or would you like to make a withdrawal? When you link your bank account to your American Funds account s , you can complete transactions online quickly, easily and securely. Specifically, you can:.
