How Do I Buy Stock

How Do I Buy Stock?

Stock Investing Basics For People Like Us

How do I buy stock? Well actually it’s a lot easier than you think these days. If you are new to the world of stock buying then it’s just a basic case of undertaking some stock investing advice before going on to open up a stock brokerage account.

You simply open up the account and deposit the funds you intend to use for your investing.

There are many of these stock brokers available that you can find listed in reputable newspapers and on financial websites around the world.

It is strongly recommended you find a review of any potential stockbroker you are looking to utilize for your trading needs as sadly there are many unscrupulous companies who list themselves as stockbrokers, take your money and never even buy the stocks.

You can also look on comparison websites and find the ones that come highly rated.

It is recommended that initially, and ideally for at least 3 months that you undertake pretend trades only. This is called paper trading. So pretend to buy a stock but do not go ahead and buy that stock.

This is because there are literally hundreds of things that can affect the price of a stock, and it is easy to wipe out vast chunks of your money, even overnight if that stock price takes a nosedive.

Steer away from tip sheets, hot tips, and low priced shares that are being recommended on websites, newsletters and friends. Generally these will end up costing you a whole lot more in the long run.

If you don’t have the confidence in your own choices, then you could easily opt to let someone else make all the decisions for you. There are investment trusts, unit trusts etc out there that are managed by experienced investors. The downside is that the management fees will be higher, but the likelihood of long term success is higher too. You get what you pay for, a lot of the time.

Don’t ever make rushed decisions. If something seems fantastic then it may just be too good to be missed. Every new day will always bring about it’s own set of opportunities that you can look at.

You can buy as many or as few stocks as you like but each purchase will carry a fee often around the £10 ($14) mark.

So if you were to invest in stocks that only cost £1 ($1.30) each and you buy 10 of them, you are likely to end up paying almost double what your funds were because of the fees involved.

This is why you will often see many investors trade with hundreds or thousands at a time.

It is not really possible to buy stocks that have no commissions attached to them, so if someone says they can do this for you, keep well away as it is likely to be a scam.

You can go for execution only trades which are normally less expensive on the fees but then again these will come without any advice whatsoever.

You may be able to go for a self-select ISA to avoid some fee’s but these can again come with annual fees instead.
Look towards established financial institutions for the best advice when it comes to these matters, such as the London Stock Exchange for example and you will be off to a great start.