How to buy stocks and shares
Buying stocks and shares is way easier than it seems. It deserves a celebratory ritual when you buy a stock for the first time. You enter the huge world of investment and have an opportunity to make big money out of your stock investment. Here is the step-by-step approach of buying stocks and shares in the trading market:
- Open a brokerage account
The process of buying stock begins by opening a brokerage account. There are a number of service providers in the market. You need to choose the right brokerage account based on your investment criteria. You may purchase and sell stocks online through a brokerage account. Opening this account is very similar to opening a bank account. Just provide your identification proof and fill up the application form. Remember to transfer funds to the account before you start trading.
- Choose the stocks you want to buy
Buying stocks is a very simple process that may be learned by one and all. Once the account has been opened and you have transferred funds to it, you need to select the stocks you want to invest in. It is ideal to choose companies with long-term growth prospects. This will ensure lesser chances of risk with a higher and a more stable return. Buying stocks and shares becomes easier when you know which stocks you want in your portfolio.
- Decide on the number of shares you want
Decide on the number of shares you want in your portfolio. This will also depend on the number of funds you have in your account. You may choose to start small and then increase the allocation on individual stocks. If you are a beginner, you should certainly start small; take time to study the market before putting in all your money.
- Place an order
Once you have decided on the number of particular stocks you want to invest in, place an order for the shares and the quantity you wish to purchase. Choose the order type which is “market” or “limit” in almost all the cases. The former means the current market rate while the latter is the rate you provide. In the case of a limit type, the transaction will only be processed when the stock achieves the rate mentioned by you.
The trading of the stocks and shares will be processed when you click on ‘Buy now’. Once the purchase process is over, it will be added to your portfolio and you may then choose to sell it as and when you wish to.