Beginners to investorswondering Where andHow to buy stocks This step-by-step instruction will be useful to an individual. It will also allow to systematize and put into practice the knowledge gained from the Stock Market for Beginners educational course.
If you are not interested in long-term investments, but trading on the stock exchange with the goal of regular income, then you will find detailed instructions on How to trade on the stock exchange.
How to buy shares to an individual
- First of all, for a competent investment, it is important to draw up your personal financial plan. He will help determine the size of his investment contributions and draw up a personal investment plan.
- Determine the initial amount of capital for investment in the stock market.
- Get basic knowledge about the stock market using books from the investor’s library, seminars or courses for beginners, as well as be sure to familiarize yourself with the basic rules of exchange trading for beginners.
- Decide on your trading system, which will have clear criteria for selecting shares, give signals for a profitable transaction and contain all the conditions for risk management. It is the trend system that is suitable for investors.
- At this stage, it is important to understand what stocks to buy. In order not to make the common mistake of beginners and not to buy weak papers that can not bring profit. Using the analysis of the chart of a pre-selected stock (for example, weekly or daily), determine the direction of the long-term trend (using also trend indicators). Remember - only strong, rising in price paper can bring you profit! If the trend is decreasing, patiently wait for the upward trend, hiding your money in the bank from sin away.
- Choose a broker to open a trading account. Nowadays it can be done quickly and easily - just fill out an online application. The broker I work with also offers investors the easiest and fastest way, requiring neither software nor paperwork - buying stocks in an online store.
- After buying securities, it is important to write down the parameters of the completed transaction in your trading journal.
- But buying stocks is half the battle. Even if the securities were chosen to hold them for a long time (the “buy and hold” strategy), it is important to know when and under what conditions these securities will be sold before the transaction is completed. These conditions should also be recorded in the trading journal in order to exclude possible doubts and throwings (for example: “sell after 10 years” or “sell if a long-term trend line is broken on the weekly chart”).
- And do not forget that one of the best ways to preserve and increase your investment capital is diversification, so try to invest in shares of companies in various industries and countries, creating a balanced investment portfolio that reduces risks.
Over the years of playing the stock market, I have learned one thing, the essence of which is that there are always opportunities on the market. Jesse Livermore
How to buy stocks on the stock exchange
Instructions for beginners
A step-by-step plan on how to buy stocks yourself:
- Create your own financial plan, determining how much you are willing to invest in stocks and what will be the sources of financing investments at the initial stage.
- Accumulate as much information and knowledge about stock trading as possible - electronic books about the stock market and stock trading, courses, seminars, tips / instructions for novice traders will help.
- Define your trading strategy. This can be either long-term investments according to the type of Buy-and-Hold strategy, or investments for short periods, counting on rapid growth of the rate under the influence of economic news, preliminary data on the company's financial results, news on possible dividends, etc.
- Decide on a financial broker who will provide access to the stock market, enter into an agreement with him, open a brokerage account and select the most suitable trading platform through which you will make stock purchase / sale operations.
- After installing the trading platform, configure it for yourself - connect the news, select tables with trading tools, charts, and more.
- Start analyzing and forecasting stock prices. Properly combine fundamental analysis (market assessment, position and prospects of the company, financial results) with technical analysis and forecasting, which are available due to the functionality of the trading platform and indicators.
- Having made a forecast of the stock price and having previously calculated the possible effect of this operation (that is, when it is sold in the future), you can buy stocks by leaving a purchase request in the trading terminal and setting a stop loss for insurance. After the transaction, write down its parameters in the trading journal.
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STEP 2. Conclude an agreement
After choosing a broker, you will need to visit his office to conclude a broker service agreement. The procedure itself can be compared with the opening of a bank deposit (takes no more than half an hour).
An account is opened for you from which you will buy and sell shares.
After the conclusion of the contract, all that remains for you is to transfer the money to your account.
Many brokers have now made the opportunity to open an account online. Without visiting the office. To register, you must have a verified entry on the portal of public services.
The procedures for opening a brokerage account will take 20-25 minutes. Of these, the lion's part of the time will be spent filling out the questionnaire. Accounts are opened remotely within 2-3 business days.
The current list of brokers providing online account opening services is on the Moscow Exchange website.
STEP 3. Buying shares
For stock trading you have 2 options.
- Purchase by phone. You call and indicate what and how much you want to buy. So it is with the sale.
- Purchase through a special terminal (Quik) - a program that allows you to see all stock quotes in real time and perform operations on the sale of a house.
In the first case, you do not need to bother, learn the technology of buying and selling shares. Quotes themselves can be viewed on specialized sites, of which there are a lot on the Internet (for example, rbc.ru, stocknavigatot.ru) You choose the shares you want to buy, call and that's it ... .. Shares are bought.
In the second case, you will need to spend some time exploring the capabilities of the program.
In addition to information about quotes, the program allows you to build graphs of stock prices and do certain analyzes using various graphical objects (support-resistance lines, moving averages and other oscillators and indicators). And if you are serious, you will also need to study technical and fundamental analysis.
Technical analysis - this is an assumption about where the price will go in the future, in each specific period of time, based on the received data for the past time.
For example. If the price of Gazprom shares at the level of 150 rubles per share began to decline in 8 cases out of 10, then according to technical analysis - if the price is around 150 rubles, it is advisable to sell your shares, wait for the fall, and then buy them again at a lower price .
Fundamental analysis - This is a forecast of prices in the future, depending on internal, external economic and political factors.
For example, take the shares of Magnet. The company is constantly developing, every year it increases the number of its stores by 20-30%. Its net profit is also growing every year, etc. Based on this, it can be assumed that the value of its shares will continue to increase in the future.
A little more theory.
Before you start trading, you need to know a few things.
1. each stock always has 2 prices: ask and bid. Purchase price and sale price.
Sellers indicate the price at which they would like to sell.
Buyers indicate the price at which they would like to buy.
Accordingly, if you want to buy - you look at the price of sellers and vice versa.
2. The difference between the purchase and sale price is called the spread.. For liquid shares (blue chips) it ranges from 1 kopeck to 5-10 kopecks. In shares of the second tier, this difference is slightly higher and can reach from several tens to hundreds of rubles from the value of the share.
2. What is a lot? Buying on the stock market one share will not work. Shares are sold in a certain minimum quantity - a lot. For example, 1 lot for Sberbank shares - 10 shares (about 2,500 rubles), for Surgutneftegas shares - 100 shares (3,000 rubles), 1 lot of Magnit shares - 1 share (but it costs more than 6 thousand rubles).
In conclusion - a nice bonus
In 2015, the state introduced IMS (individual investment account) to stimulate funds in the Russian economy.
What gives this to us? You can get an additional 13% of your investment in IIS. In essence, this is guaranteed profitability.
But .... there are 2 conditions:
- IIS must be open for at least 3 years,
- 13% can be returned only with 400,000 per year.
Otherwise, everything is absolutely the same as when opening ordinary brokerage accounts.
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