The first thing you need to do before you can buy any stocks is to sign up for a trading account with a stock broker. First answer this question – Do you want to make the trades yourself online or do you want to call in your trades to a stock broker?
Tradeking is a discount trade broker, Zecco is a broker where you pay a monthly fee and get free trades, and Ameritrade is a more traditional online stock broker that offers very low prices for each trade (usually less than $10/trade).
Most people reading this article will want to make their trades themselves. If that is you then let me provide you with a few tips before you go off investing on your own. There are currently three stock information and adviser services that we endorse. If none of these work for you then you may want to consider reading one of the Top Investment Books.
For stock picks, we recommend Jim Cramer’s action alerts plus service.
For day trading or penny stock trading we recommend Tim Sykes’ Penny Stocking DVD and TIMAlerts service.
For general market information we recommend a subscription to Investor’s Business Daily.
If trading online isn’t your thing then your best bet is to visit a local financial adviser or start a account at a large local stock broker. Charles Schwab, Bank of America, even E-trade all have local branches where you can open a trading account. A representative there can help you get started.
Assuming you have an account setup, here are the steps you need to follow to buy stocks.
1. Transfer money into your trading account. (Either through the website, by mail or deposit at your local branch)
2. Identify which stock you want to buy
3. Determine how many shares you want to buy
4. Enter an order to buy the shares using market or limit orders.
-Market orders – more risky, you are putting in an order to buy shares at whatever the current market price is.
-Limit orders – enter the price you want to buy or sell the stock at.
5. Enter the time frame for the trade – This will determine how long your order will last before it expires. You can select a day, or multiple days.
6. Confirmation – Find confirmation that your trade went through by viewing your trading history.
Tread slowly as you get started. Even the best traders make mistakes. Don’t be afraid to ask for help, no one gets it right all the time. Trade at your own risk.