How to Buy Stocks

Hubby and I have been discussing the purchase of stocks lately. We both have some and we are looking into purchasing more. We found THIS article to be interesting.

Introduction

Buying stock in a company is relatively easy once you've researched the stocks you're interested in and have a broker or brokerage account to handle your purchase.

Instructions

Difficulty: Moderate

Steps

1

Step One

Educate yourself fully about stocks before purchasing them. You can find information about stocks and brokers on the Internet.

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Step Two

Determine what you want in a broker or brokerage account. Do you want to meet with someone face-to-face? Will you want to be able to reach someone by phone? Do you require Internet access? Is price your only consideration? Do you want to buy and sell only stocks, or would you also like to buy and sell mutual funds, bonds or foreign stocks?

3

Step Three

Choose a broker or brokerage firm to purchase the stocks on your behalf based on your needs. Need a lot of advice? Start with a full-service brokerage. The least expensive brokers may not offer advice. Fairly confident and want low prices? Try an online brokerage.

4

Step Four

Contact a broker or firm and request an application. Many firms offer online applications, although most require that you send a check or wire money to actually open the account.

5

Step Five

Deliver a check in person if possible to speed up the process.

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Step Six

Begin buying and selling stocks once your account is open.

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Step Seven

Review statements you receive and reevaluate your portfolio's performance. Are you moving toward your investment goals?

Tips & Warnings

• Ask friends or colleagues for broker or brokerage-firm recommendations. If you don't have a personal recommendation, read ads in financial publications such as "The Wall Street Journal."
• An online brokerage account is convenient and fast but can be susceptible to computer glitches. Ask if you will be able to make trades by telephone if need be.
• Ask brokerage firms to list all fees. Watch out for hidden costs (account transfer, electronic transfer or handling fees).
• It can take a few days to open a brokerage account, so don't expect to be able to trade on the same day you decide to open an account.