For those who’ve wanted to buy and sell stocks, starting a brokerage account can be done fairly quickly and easily. Just keep in mind:
You can be a winner…or lose a lot.
1. Open an Account
After researching different online brokers, I went with Scottrade. $7 to buy shares, $7 to sell. No shenanigans. You’ll need at least $500 to open an account.
2. Make a Plan
There are thousands of stocks listed on U.S. exchanges, so plan on trimming the list down a bit. The best place to start: ask yourself how much are you willing to invest? I haven’t put more than $4,000 in a stock, so I look for stocks priced less than $10/share. You can use the profit calculator below and Google’s stock screener to develop a realistic plan.
Other major factors I consider when choosing a stock:
- Market Cap. of at least $1 billion
- No ADR‘s
3. Research, then Buy
After finding stocks in your price range, do a little ‘qualitative analysis‘ and look at news articles and charts for each stock. Get a feel for where you think the company will be headed during the time you will be buying/selling. If the fundamentals are good, buy in.
4. Manage the Account
A Google Docs spreadsheet can help keep your buying/selling organized. You can use the template I use, make your own, or just use the info provided on your brokerage account.
Google Docs Template
For more financial tidbits, click over to Finance Talk.