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Ready to jump into the stock market? Awesome! The first thing you’ll need to know is how to trade stocks.
In this article we’ll look at what you need to have in place in order to buy and sell a stock. Plus, some other basic info that’ll help you save money when trading stocks.
The first thing you’ll need is an account where you can put some money you’ll use to buy/sell stocks. Here, you have 2 main options.
First option is to open up an account with a stock broker. Then your broker will take care of your buying and selling for you. This makes it super easy cuz you don’t have to know what you’re doing.
This is the easy option. However, it comes at a cost. Literally.
Using a stock broker to buy/sell stocks will cost you more than if you did it on your own. Because the broker is providing a service and gets paid for it by charging a commission on your trades.
But every commission you pay to a broker means less money in your pocket. And since we’re all about building YOUR nest egg here, we’d recommend you go with option 2.
Option 2 is to open an account with a self serve brokerage. These are firms like TD Ameritrade, Etrade, Fidelity and Charles Schwab.
In this case, you open an account online. Then you put some money in it. Then you can log into your account, select a company to invest in, choose how many shares you want to buy and make your first stock purchase!
Many of the self serve brokerages have $0 trades for clients these days so buying/selling a stock won’t cost you a penny!
Also, some of these brokerages like Fidelity and Schwab do have brokers you can turn to for advice or help on trading. So, if you need it, they can hold your hand as you get started with trading stocks to make sure you are doing it right.