subject: The Basics Of Online Share Dealing [print this page] Trading in stocks has undergone many changes in recent years and online share dealing is probably the most significant one. Online share dealing is the modern way of trading in stocks without going through the hassle of the real-life stock market. Trading online operates much in the same way but everything is done through your computer or your cell phone. Here's how it works.
First of all, you need to open an account with an online stock brokerage company. There are certain requirements that deal with proper identification and minimum balances, most of which are mandated by law and meant to provide the necessary safeguards for investors. Once your account is opened, you can buy and sell shares of stock the way you would in a regular stock exchange through regular stock brokerages. Stocks bought or sold in online share dealing are those that are listed on the Stock Exchange.
To trade in stocks online, you must access your account on your broker's website. There you will find the current prices of stocks. By clicking on the relevant instructions, you can instruct your online broker to buy stocks or sell those you already own. Although the decision is completely yours to make, online stock brokerages also provide information like stock trends to help you make an intelligent decision. Reports about your transactions are available through your online account which can be accessed anytime.
First introduced in the United Kingdom in 1994, trading stocks online has broadened the investor base in the stock market by facilitating stock trading transactions and simplifying procedures. In the process, it has helped to reduce the commissions that are applied to transactions making stock market trading even more attractive to a wider market. Some online brokerages charge a percentage of each transaction while others charge a flat fee regardless of the transaction amount.
Because the whole process is carried out online, the stock trading process is quicker and more convenient. There are apps that enable you to do online trading through your cell phone. For those who continually monitor stock market developments, this advantage allows them to buy or sell without having to go through the process of giving verbal instructions to a broker.
Another advantage of online stock trading is the speed with which market information can be accessed. With online stock brokerage sites, real time information about the market and individual shares is available. Especially when markets are subject to high volatility, this advantage enables you to make your buy-or-sell decisions on the spot.
Like your bricks-and-mortar stock trading activities, online stock trading is regulated by the government. Records, financial transactions and tax liabilities are equally monitored and subject to the same restrictions. As an investor, your transactions in online stock trading are just as adequately protected with the added advantage of being immediately accessible and subject to review.
Before deciding to engage in online stock trading, you need to do your research. Check out the different online stock brokerages, read their conditions carefully especially those regarding commissions and then make your choice. Many of your friends may also be engaged in online share dealing so it might help to inquire about their experiences and ask them for recommendations.
by: Rob Wilmas
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