Buying and selling stock, also known as trading stock, is as easy as opening an account with an online brokerage, funding it and choosing stock to purchase. If you've ever funded a PayPal account and purchased items online, then you already have the technical skill set needed to trade stock. However, making money from trading stock can be difficult, even for professionals. So start with small and work towards taking more risk as you gain knowledge and confidence.
Discuss your investment strategy with your partner. Whether you're newlyweds, living together or have been married for years, make sure that you and your partner have the same expectations for how much to invest and what to expect from those investments. Be aware that in volatile markets, stocks can lose all of their value, or their value may increase multiple times. Money market accounts, real estate, bonds, and retirement savings are just a few of the options that can offer less risky investment options, so be sure that you and your partner are on the same page and have weighed all options.
Choose an online stock brokerage. There are a number of factors to consider when choosing among the various firms. If speculation or day trading, as opposed to long-term investment, is your strategy, then consider an agency that charges a flat fee per month rather than a per-trade fee. Also check to be sure the initial minimum deposit required by an agency meets your expectations.
Send the broker an initial deposit of funds. This will require providing your bank account number and routing number. You may need to allow the firm to make a couple of investments, usually for a few cents each, into your account. Then you confirm the investment amounts. This insures that you are the owner of the account.
Monitor your stock portfolio. Set stop-loss orders to automatically sell your stocks when the price falls below an amount that you specify. With practice and patience, you will learn what your tolerance for risk is and how much you're comfortable investing.
- Buy low and sell high.
- Set stop-loss limits to have the brokerage automatically sell your stock if it falls below an amount that you specify.
- Diversify your investments by sector.
Michelle Boardman has worked as an information-technology consultant and trainer for numerous Fortune 500 companies since earning her master's degree in rhetoric from Purdue University. From technical training guides to professional editing for university publications, Boardman's eclectic experience includes graphic design, business analysis and copywriting.