The stock market can mean a gold mine for investors. We’ve seen it in movies like The Wall Street Wolf. If you know how to invest in an online stock market you can earn a lot of money. Thanks to the internet, accessing this market is very easy, from your home or mobile you can invest in an online stock exchange, purchases of shares without much effort, or simply see how the ones you already have been quoted. Different applications and web pages offer these services.
However, even though it is easy to invest in an online stock market, it is not always easy to profit from the stock. It is not a secret that the stock market is reputed to be complex, due to the risk involved in its investments, and with the globalization made possible by the internet, this is even more present.
This is why it is necessary to learn how to invest in the stock market and thus be able to get the most out of your investments.
The objective of this article is to analyze what you must take into account when investing in the online stock market. Also, understand the fundamentals and concepts that you need to know and some tips so that you can invest your money.
First, what is the stock market?
The stock market is a daily term that we use to talk about the place (market) where different types of assets, such as stocks, bonds and financial derivatives are “traded”, that is, they are bought and sold.
Invest in online stock market:
With the popularity and accelerated growth of the Internet, it was only a matter of time before this market was transported to this medium. In fact, trading in the stock market is one of the many ways to earn money online.
Investing in the online stock market is one of the most profitable business today and versatile investment options thanks to the large number of platforms, online brokers and intermediary agencies that it offers.
Therefore, it is one of the fastest growing industries today, to which thousands of people go every day to learn how to invest their money and devote full time to this career.
How the online bag works:
Traditionally, when you buy shares you become a shareholder, which means that you now own a “part” of the company.
If the profits of the company increase, your actions will increase in price, winning you too. If the company’s profits decrease, so does the price of your shares.
While this is a basic description, since there are different ways to make money with the stock market, the important thing to understand is that there you can invest in stocks, binary options, bonds and even cryptocurrencies.
Investing in the online stock market follows this same principle of ownership and investment in shares. However, it differs a bit in terms of the means to get to this.
In the online stock market, transactions must be made through the use of agents called online brokers, who act as intermediaries who conduct the exchanges in your place.
The benefits of investing in this way is that you do not have to be in a specific place to trade in the stock market; It does not matter if you are at home, on the beach, or at work and you see it as an option to earn extra money in your free time, online investments open up a world of possibilities.
Now that you know what the stock market is and how it works, let’s begin to clarify how to invest in it online.
To begin we must clarify what are online Brokers, as this will be our tool to access and invest in the stock market no matter where you are.
All the people who decide to invest in the online stock market on their own do so through the Brokers. These are entities that allow you to invest in the stock market through the internet.
These online brokers allow access to the financial markets in the stock market. You can invest in both national securities and any listed company in the world, from large companies to many smaller ones.
Web pages, applications and even banks serve as Brokers. Its advantage is the possibility of investing from home and monitoring how the shares are traded with just one click.
There is a huge amount of Online Brokers, later we will tell you which are the most reliable.
How to negotiate online stock from home:
To negotiate the online stock market from home we must open an account with the trading platform with which we feel more comfortable. There are several like Plus500 and eToro, but later we will show you a list.
To begin, you will be assigned a user key and an operative key to complete the transactions online.
Each account is associated with a current account, which is the place where the money will be when a purchase order is given, and where you must enter the money from stock sales, collection of dividends, and more. Any operation we do has specified costs and commissions.
Online stock market trading costs:
The main factors that influence the cost of investment through the Internet are the costs of intermediation, the fees of the stock exchange and the expenses of administration of the values.
Intermediation costs are percentages of collection on the investment that Brokers demand for the use of their service. They go from 0.25 to 0.35% of the investment with a minimum per operation.
Finally, we have the expenses of administration of securities, which are not more than a percentage of commission on the securities held.
They are about 0.25% of the nominal value of the custody and are charged quarterly or annually. They have a minimum amount of payment.
However, you should know that these costs will depend on the country where you open your account, since commissions may vary depending on the amount, your location, and some other factors.
Now, globally, online broker firms can be divided into two types:
They can work by commission, commonly charging between $75 and $100 for purchase or sale. Or they can work for annual sales commissions, typically around 1% or 2% of the value of your account.
They do not offer guardianship and the rates vary based on the size of your account. The typical is a maximum of $30 per purchase or sale, although you can get around $5.
List of online stock market trading platforms:
Then we leave you a list of online trading platforms, however, it is your responsibility to advise you well, review which one suit you best and choose one that suits your needs.
Plus500 is another platform that allows you to negotiate in the most recognized markets worldwide such as the United States, Japan and Germany.
They also have a demo account in real time that allows you to make trial quotes and evaluate your negotiation decisions.
Before negotiating your real money, try the demo account that has all the support to solve your questions and doubts.
This type of platform, although easy to use, requires you to have experience in the market since complex financial assets such as CFDs are negotiated, which is why they are not recommended for beginners.