Buying stocks online is a quick, easy and affordable way to start investing in the stock market. If you’re a newbie, however, you’ll need to learn the ins and outs of how to trade stocks online to succeed.
First, review these steps that show you how to buy stocks online.
Steps to Buying Stocks Online
Although choosing the right stocks and investments can be challenging — and the stock market can be unpredictable — buying stocks online is a straightforward process.
Here’s how to buy a stock online:
1. Find an Online Broker
Decide if you want to use a discount broker. If you’re just starting out with investingand are unfamiliar with the stock market, if might be wise to seek the advice of an experienced investor who can help you with basic stock tips.
However, if you’re already familiar with the market, comfortable doing your own research and want to buy stocks online, online brokerage firms can help you make your first online trade immediately. Using discount brokers offers several advantages. You get the convenience of investing online and you can easily diversify your portfolio by choosing from a variety of different investment options.
You can start trading at relatively low fees. As a rule, discount brokers are far cheaper than normal brokers — and stock-trading services like Robinhood allow you to do free stock trading.
2. Choose How Much to Invest
It can be tempting to put a large sum in the market in hopes of getting a big return. But if you’re new to the market, understand that stocks are always volatile, and it’s not a good idea to pour all your money into a single type of investment.
Know what you’re buying — for instance, penny stocks can be especially volatile. Avoid risky stocks and investing too much money at one time — after all, you never know when the next big crash will happen.