Updated: Jan 20
Many people think that understanding a stock market is very difficult, However it's not that difficult. Investing in stocks is the same as buying a business or a company. In fact Stock Market is a great place to learn how to run a business or company. So the question is Where do you start from ?
Find a Reputed Broker
You need to open an account with a good broker. There are some brokers who offer cheap commission on each transaction, However I would suggest to open an account with a reputed broker. I normally use CommSec here in Australia. CommSec belongs to the Commonwealth Bank of Australia, which is one of the top bank in Australia. CommSec is an easiest option for me as I have a savings account with Commbank so I can easily and quickly transfer funds to and from my Commsec account. Commsec charges about $10 commission on every buy and sell transactions up to $1000 and $19.95 for Over $1,000 up to $10,000.(Link for fees info: https://www.commsec.com.au/support/rates-and-fees.html). I am not advertising Commonwealth bank in here , so this is just an example. You can compare rates of different reputed brokers in your country or location and choose the one is best for you. Also you need to open a separate account to buy international stocks.
I have seen often newbies or beginners get scammed because they get too excited and they rush to throw their hard earned money into wrong hands. They don't research before investing, so new investors needs to be very careful before taking any steps. I don't believe in Day Trading, Bot Trading(robot trading softwares), futures, options, CFD etc, I believe it's a gambling and there is a 95% of chance of losing your hard earned money. I would suggest never get into to day trading as it's a total gambling. Over 90% day traders loses money.(search on Google about Traders losing money) There are day trading platforms like eToro and Plus500. New investors needs to understand the difference between broker types. Investors buying through day trading platform like Plus500 actually do not own any stocks they are just like gambling in casino or like just betting on a horse.
When you buy a stock through broker like Commsec or ANZ, you actually receive a certificate of ownership from the share registry of a particular stock or a company. It gives you right to vote for or against any decisions management or company is making. It gives you right to become an actual owner of the company for lifetime unless you sell your shares(ownership). More shares you own more power of ownership you have. There are investors who invest through proper brokers but still do day trading and they own stocks for days or even few hours then they sell them. Actually 90% of them loses money because they do not follow investment fundamentals and they just buy stocks without researching its a good or bad company. I believe the best strategy is "buy right and hold tight".
Now lets move to the next step.
Download an App or Use Website.
I use Commsec app and you can check if your broker has an app or not. If your broker doesn't have an app then you can use their website for buying and selling. I use my Commbank app to transfer funds into Commsec. Once you download an app find out how to use your broker's app by learning app features on their website or on their app. Most importantly read their conditions and restrictions.
Once you have completed all the steps mentioned above, do not rush to buy any stock. Please read my next post first Click Here " What should You check before buying a stock?(Beginners to intermediate Guide) .