How To Buy Stocks

I friend of mine asked me to teach him about buying stocks. Here is a how to guide explaining the process.

• What is a Stock?

A stock is a percentage of ownership in a company presented as a unit. Public companies stock trade on an stock exchanges.

• What is a stock exchange?

A stock exchange is like a market place, where buyers and selling come to trade stocks, sometimes referred to as a share or share of stock.

• How do I purchase stocks?

As mentioned stocks are traded on exchanges. Most individuals must have a brokerage account to access the exchange in order to trade the stock.

• How much money do I need?

Some brokerage accounts allow you set up an account with $100 or less.

• Set up a brokerage account

In the United States, there are retail brokerages where one can open an account. A few popular ones are:

• TD Ameritrade
• Schwab
• Fidelity
• ETrade
• Scott Trade
• Robinhood (see below)

Do brokerages charge fees in order to trade stocks?

Yes. Most all brokers charge fees called a commission in order to place trades on your behalf at the stock exchange.
One exception is Robinhood, a mobile app based trading platform that offers stock, options, and cryptocurrency trades for no commissions.

How to fund your brokerage account?

After you have successfully opened a brokerage account, you must fund the account or deposit money into it. Most brokerages offer direct deposit into your account from your checking account.

Please leave a comment.

Thanks,
@pairmike

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