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Buy and Sell Shares On the net – A Simple Guide
July 25th, 2010 by admin
“Shares”, also known stocks, are the portions of the company which a person can buy and thus become its owner. Buying and selling of shares online now-a-days has become a regular trading practice. Online trading is become the most popular trading mode due to the convenience and the speed at which you can place your orders and trade with them. You can buy and sell the shares on the same day at the price you quote and also can routinely keep a track of all your transactions together at a single place and in a single window.Also, besides the speed and convenience, Online buying and selling of shares is cheaper and the investor has to pay minimal brokerage charges. This makes the Online buying and selling of shares preferred than the traditional and telephonic ways of dealing.Buying and selling the shares is an easy-to-learn and easy-to-deal procedure. Following is the step-by-step procedure with the do’s and don’ts to help you understand the process better, especially if you are a first time investor.Get a licensed online stock broker:Shares can be bought and sold in several different ways. One among them buy and sell shares the broker to trade (i.e. buy and sell the shares) on your behalf. Thus, it is always recommended to do a careful research on the broker you choose to be on the safer side.Before selecting the broker ensure that:• The broker is the license holder in trading,• Ensure that he is providing the online facility to buy and sell the shares,• Ensure that the transactions are processed on the same day. This is the important as there are some brokers who take almost three to four working days to process the orders placed. Thus, you may not be able to buy and sell the shares at the price quoted by you.• Ensure that the broker has sound knowledge in the field so that when required he can advice you on the factual details of the stocks. Not all the brokers provide the guidance. Most of them will do the trading as instructed by you, but having one who can advice you on the stocks should always be an additional help.Brokerage Account opening:Once satisfied about the facilities provided by the broker you can go ahead and open your brokerage account with him. There are number of details that you need to furnish to the broker like your personal details, tax information number, and social security number, etc. Before you begin buying and selling shares online, these details need to be furnished to the stock exchange or brokerage and get their approval.Now that you have selected the broker and have opened your account with him, it is equally important on your part to study and understand the stocks you desire to buy and sell. Analyze why you intend to have them, what are the benefits you are expecting from them and the time frame in which you would like your money to keep invested in the selected stocks. Selection and diversification of the stocks is an important criterion to maximize your profits during upturn of the stock market and stabilization of loss during the down turn. Thus before dealing in share, it is always recommended to consult a financial expert. Buying and selling of share online though and easy task require careful selection of the stocks as it is based on your instructions that the orders are placed.