Managing an Online Brokerage Account

To trade stocks online, you need a trading or brokerage account with a stockbroker or bank. Most banks add online brokerage account to your services automatically when you open a checking or savings account. Managing an online brokerage account involves more than buying and selling stocks, it includes tracking your holdings.

Difficulty: Easy

Instructions

1. Research stockbrokers and banks offering online brokerage services. Look at their fees, commission, margin interest rates and times of executions. Open and fund your online brokerage account. Most stockbrokers and banks accept funding through personal checks, money orders, wire transfers and bank-to-bank deposits.

2. Research stocks online. Pay attention to the stock price, bid and ask price, current and future earnings, management styles and return on investment. Check the stock’s charts to confirm the health of the stock. When you are ready, log onto your stockbroker’s trading platform, enter the stock's ticker symbol, the quantity you are buying, the type of trade and any instructions for your stockbroker. Then click "Buy." The next page will ask you to confirm your order. Click "OK" to place your stock order.

3. Track your stocks daily. Log onto your stock trading account and monitor the movement of your stock daily. You can also use the free stock tracking software available online from Yahoo! Finance and ADVFN. To set up your free trackers on Yahoo! Finance, log onto your Yahoo! account and go to the Finance category. In the upper-left corner, click "Create," select "Stocks Portfolio" and enter information about the stocks you want to track. See Resources below for additional information.

4. Go to ADVFN. In the upper-left corner, click "Free Membership," complete the form and click "Submit." In the next window, enter the ticker symbols for the stocks you want to monitor. ADVFN allows you to enter additional information about the stocks like your date of purchase and price you paid. It then shows you daily the value of your holdings.

5. Access your brokerage account from your home computer only. Never access it from public computers in the library, Wi-Fi hotspots or any other public arena. Change your password regularly, and choose passwords that are hard to guess. Use uppercase and lowercase letters and numbers. Don’t write your passwords anywhere. Choose words that mean something to you. Update your anti-virus and anti-spyware software. This ensures that others can’t steal your password from your computer using malicious software. Scan your computer for viruses and spyware regularly.

6. Read your account statements from your stockbroker when you receive them monthly. Verify that the trades listed on your account are accurate. Verify that your address is correct. Notify your stockbroker immediately if you find trades listed that you didn’t order.

7. Confirm that your personal information like Social Security number, driver’s license number and password aren’t listed on your monthly statement. Follow your stockbroker’s instructions regarding inactivity to avoid fees.

Tips & Warnings

• Stocks price quotes from Yahoo! Finance are delayed for 20 minutes, while ADVFN gives you real-time stock quotes. They also allow you to enter other information about your stocks like the date of purchase, time of purchase and conditions affecting purchase.
• When you buy stocks, you have two options on the type of trade, "Day" and "Limit." When you select "Day," you tell your stockbroker to make the trade immediately. Your stockbroker won’t execute limit orders if the stock price rises about your price limit or doesn’t hit your target price.

Resources

• Use Yahoo! Finance to track your stock portfolio.
• ADVFN gives you a free real-time stock tracker.
• SEC: Safeguard your online brokerage account.
• Kiplinger: The best online brokers