Discount stock brokerage companies provide websites where account holders can log in and buy and sell stocks through the brokers' online trading systems. To start buying stocks online you need to select a broker and also determine the stocks in which you want to invest.
Compare the features and services of several online discount stock brokers. The Smart Money magazine annual broker survey provides a listing of the best brokers in different areas and a ranking of the best online brokers. In the 2010 Broker Survey, Fidelity, E-Trade and TD Ameritrade were the rated the top three brokers.
Choose a research method for selecting stocks as investment candidates. The online broker you select should provide research tools that fit you investment goals and intended investment strategy. For example, the Fidelity research section allows the screening of stocks using various expert strategies.
Apply for and fund an account with your selected broker. The application process can be completed online and the broker's website will provide directions to send money to fund your account.
Select stocks for investment. Research individual companies before investing and understand the reason you select any stock for investment. The level of your stock market success is dependent on the stocks you select.
Buy shares of stock using the trade screen of your online brokerage account. The screen will require you to enter the stock's ticker symbol and number of shares to purchase. Orders can be placed as market orders, which will be filled at the current share price, or limit orders, which will be completed when the shares hit the price you select for the limit order.
Tips
Stock investing is a learning process. Start with small amounts of stock and invest in larger amounts as you learn and develop your investing strategy.
The online broker makes money from commissions when customers buy and sell. It is not necessary to be an active trader to have success in the stock market. Buy-and-hold can be a successful plan.
Warnings
When you buy stocks through an online broker, you are entirely responsible for the gains or losses resulting from your investment decisions. Do your own research and understand the risks before buying any stock.
References
Tips
- Stock investing is a learning process. Start with small amounts of stock and invest in larger amounts as you learn and develop your investing strategy.
- The online broker makes money from commissions when customers buy and sell. It is not necessary to be an active trader to have success in the stock market. Buy-and-hold can be a successful plan.
Warnings
- When you buy stocks through an online broker, you are entirely responsible for the gains or losses resulting from your investment decisions. Do your own research and understand the risks before buying any stock.
Writer Bio
Tim Plaehn has been writing financial, investment and trading articles and blogs since 2007. His work has appeared online at Seeking Alpha, Marketwatch.com and various other websites. Plaehn has a bachelor's degree in mathematics from the U.S. Air Force Academy.