How to Buy Shares
Dec 17th, 2009
Although it is sometimes a bit intimidating to get involved with stock trading, the mechanics of buying shares of stock are really fairly simple. At the very least we can get you started down the road to making the process easily understandable.
How to Buy Shares Step One
The first thing you need to do is to open a stock trading account with a broker. The most convenient place to open an account is online. There are many discount brokers that will provide you with a practice stock account that you can use to explore the different options available when buying stocks.
Deciding which broker to use is not the biggest concern right now. All you really need to look for is a broker that offers a paper trading account. If you don’t want to explore your options at this point ThinkorSwim offers a very nice paper money account. You will need to provide all the pertinent information much like signing up for any account. With ThinkorSwim you will download a desktop application that allows you full access to their trading platform.
OK… now you have an account and are ready to learn how to buy shares.
How to Buy Shares Step Two
Open up your trading software and go to the trading page. Depending on which software you have chosen this could be named something different. One easy way to start a trade is to search for the ticker symbol of the company whose shares you are going to buy. If you don’t have a ticker symbol handy you can use “T” (without the quotes) which is the symbol for AT&T. Again it doesn’t matter that we are choosing AT&T, it is just an easy example. You should be on an order screen or see a button that will allow you to buy shares. This is where you will be presented with the different order types. I go into a little bit of detail on a couple of order types on my how to buy stock article.
For now we will place a market order. This type of order will purchase the amount of shares that you designate immediately after you click the buy shares button. Your practice stock trading account will be assigned those shares of stock in exchange for a certain amount of your paper money. That’s it! You’ve just gone through the process of buying shares. You will then be able to follow the progress of the stock you’ve purchased on a real time basis. That’s all there is to it… buying shares of stock has become an easy process.
How to Buy Shares Step Three
After you have familiarized yourself with the stock trading basics, you will need to fund your account in order to purchase real shares of stock. This process can take a little bit of time. The broker will need to verify your identity. You will probably have to send in a copy of your identification along with finding a way to get money into your account. You can usually do a bank wire, Western Union, or send a check. There are other ways to fund your account, check with your broker to find the one that works best for you.
After going through these three steps you will be ready to buy stock on the open market. Here’s to profitable trading!
Related Posts
- Buying Shares
- Opening a Practice Stock Trading Account
- How to Buy Stock
- Best Stocks to Buy
- Welcome to Practice Stock Trading Systems