Introduction
The advent of the internet has turned the world into a global village. What a person needs to have access to the global village is just a computer and an internet connection. Nowadays, almost anything can be done with just a click of the mouse. Thus the internet has created the platform for the emergence of the online stock market where trading online stock is done. Traders can now start trading online stock from anywhere in the world and at anytime. This has opened up the stock market to everyone. Trading online stock has numerous advantages over trading on the floor of the stock exchange. The unique selling point of trading stock online is that it can be done from anywhere and at anytime. Trading can be done from anywhere of choice and convenience of the trader. It can be from the trader’s home, office or hotel room. Also it can be done anytime. The trader don’t need to wait for the opening bell like in the stock exchange floor to start trading. Trading online stock can be done 24 hours a day, 7 days of the week and 365 days a year. Thus traders can trade round the clock.
Step 1
The first step to begin trading online stock is to have a computer and internet access. This will give you access to the online world where the online stock market is located.
Step 2
The next step is to open a trading account with an online broker. Online broking firms have the comparative advantage of faster service and convenience. Investors can do their trading anywhere, anytime and at a fast speed. They don’t need to call their stockbrokers during working hours to place a trade for them. They do their trading with just a few clicks on the internet. Opening an account with an online broker is very easy. The trader is required to sign up for an account on the website of the broker. The website is the platform where services offered by broker can be accessed. Setting up an account requires assigning a username and password to the trader. Security questions will be provided which are to be answered by the would be trader. This is done to protect the account details and privacy of the client. Also details of the client’s financial history will be provided to determine the type of account to set up for the client. An account will be set up for the trader after completing the application process and fufilling the required conditions. The client can now fund his account and begin trading online stock.
Step 3
Placing a trade is very easy in online stock trading. It simply involves buying or selling stocks by clicking the buy button or sell button of a trader account. Before trading, a trader needs to have real-time stock quotes of the current price in the market. Some online brokerage firms provide real-time stock quotes as part of thir services. A trader can place an order to buy or sell his/her stocks at the current market price or a specific price. Once the stocks are bought or sold, the trader’s account will be debited or credited accordingly with the stocks or money equivalents.
Step 4
The success of trading stocks online is dependent on the trader’s knowledge and understanding of how the market works. For a trader to be successful, he/she must have a proven stock trading strategy that works for him/her. A superior knowledge and understanding about how the market works will place a trader in a prime position to profit from the market.
Step 5
Step 5
Online stock trading is a money spinner for the smart investor. There is no geographical and time barrier to trading stock online. This is one of the numerous benefits of living in the 21st century.
