How to Buy Stocks for Beginners: 4 Steps to Start in the New Year

Investing in stocks for the first time is a daunting task. It can be scary because real money is at risk of loss.

However, equities are the path to building wealth because they represent ownership of a company and a claim on future profits and earnings.

In the past, an investor had to deal with a broker who placed a buy or sell order. Today, orders are placed directly by the investor online.

Pick a Brokerage Firm

Opening an online account is simple and easy. First, a person must complete the application, provide the necessary identity information, and wait for approval.

Open an Account Online

Lastly, an investor needs to add money to the account by directly linking a bank account and transferring funds or mailing a check.

Start researching a stock by reading about it in one of the many investing books available to the public regarding learning how to research and select stocks.

Research a Stock

The next step is to decide on an amount to invest. If you have a lump sum, it makes sense (and reduces risk) by not investing it all in one trade.

Amount to Invest

The last step is to select an order type. The two basic order types are a market order and a limit order. There are more order types, but beginners will mainly use these two.

Select An Order Type

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