How to Buy Stock in a Company
Getting involved in the stock market today is easier than ever, thanks largely to the Internet. People now have access to around-the-clock information about the market and about what stocks are going up or down right at their fingertips whenever they need it. The Internet has made investing an easier market for beginners to break into as well, as now there are many online brokers who offer full service packages to help new investors learn how to purchase stock in a company of their choice.
- Difficulty:
- Moderately Easy
Instructions
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1
Do some research into the current stock market and get familiar with the trade system. The best way to do research into the stock market is to read publications that center completely around how to buy, sell and trade stock. Invest in the "Wall Street Journal" and other stock publications, and digest as much information as you possibly can. You might want to consider doing some paper trading. This is where you pretend you buy stock and get practice on how to buy and when to sell before investing any actual money (see Resources below).
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2
Choose an online broker to help you get a stock buying and trading account set up. There are quite a few brokers online that you can invest with. Some of the most highly recommended are ScottTrade and ETrade (see Resources below). Choose a full service broker, as these will help give you advice about where to invest your money and what stocks are right for you since you are just starting out. Discount brokers charge less per trade, but offer no real help in determining what is right for your first investment.
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Contact the broker and fill out an application (also available online at the broker's site). You will need to print out the hardcopy and mail it to the broker's address. After this is completed, the broker will help you set up your account and you will almost be ready to begin buying stock.
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Transfer money to your trading account by check, credit car or wire transfer. Many companies require you to have a certain amount of cash in your account before they will allow you to purchase any stock, so be sure to check with the broker beforehand to make sure that you have enough money to put into your account.
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Do more research in the "Wall Street Journal" and utilize all of the tips, tricks and help that the broker offers you to select the stock you would like to purchase. Things to look for are how stable a company is, its profits and also leadership (is the CEO a trustworthy, experienced leader?). Full service brokers will have plenty of helpful hints and advice that you can use to help determine your first stock purchase, so take full advantage of the service.
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