Investing in stocks is one way to secure your financial future without labouring too long and hard for it. So if you’re thinking of how to buy stocks for beginners, this article is for you.
Financial advisors can teach you the finer points of buying stock, but we’re here to cover the basics in this post.
Choose an online stockbroker
If you’re a beginner, chances are you won’t need traditional full brokerage services yet. These brokerage firms typically give financial advice that has to do with retirement planning and other financing situations for senior citizens (which may not be your main concern).
A more practical option for you would be to choose an online stockbroker, instead. There are trading apps available to help you look at, buy, and trade stocks with just a few clicks and in a matter of minutes.
These days, it seems a simple enough matter of opening up an online brokerage account with proof of identity and electronic fund transfers. You can even buy stocks directly from the company’s official website.
Of course, this is easier said than done because doing some research is still the best way to go before delving into stocks. But if you’re starting out, lesser fees paid to brokers and other services is the more practical move.
Do some stock research
Overwhelmed by financial questions such as when to use the money in your CPF accounts? If you don’t speak the stock lingo yet, don’t fret.
There are Robo advisors that exist to help you figure it out and invest your money wisely. The great news about them is they’re geared toward beginners who may not be able to meet the minimum required investment of traditional advisors.
There are also online trading platforms like IG Markets which are safely regulated by international financial institutions. It’s a good idea to look into these so you’ll have peace of mind about your money being in safe hands as you grow it.
Settle on how many stocks you wish to purchase
Ultimately, you can look for trading platforms that give real-time stock quotes and company stock information. Tiger Brokers is one such platform that you may want to look into.
You can buy stocks conservatively at first and it would be perfectly fine. You can also consider less conventional places to invest in such as businesses for sale in Singapore, but we think it’s best to play it safe until you figure out what you’re doing.
Luckily, there are things like fractional shares now instead of the usual full shares so you can buy stock in portions first. And if you have money earmarked for shares, there are tools to help you convert your SGD to shares to make things less complicated.
Know your market orders and limit orders
Buying stocks for beginners is a good way to diversify and reduce risks for your personal finances. Just like bookkeeping is important for small businesses, taking the time to understand the nuances behind stocks is a must to be successful.
Market orders and limit orders are the two basic stock trading terms to keep in mind as a beginner (and even a seasoned) investor. A market order is the request to buy or sell a stock as soon as the best available price is known.
On the other hand, a limit order is when you can request to buy or sell stock at a price you think will be better. This gives you more control over the price during trading.
We previously compared some Robo advisors that are geared toward beginner investors. They include Autowealth vs. Stashaway, and they can recommend the right investment portfolio for your current situation in a simplified manner.