Investing in the Stock Market

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The Great Depression of 1929 got many investors in the stock market by surprise. However, there was one lucky investor, Joseph Kennedy who had sold his shares before the Black Thursday which was the start of Great Depression. The decision by Kennedy to sell his shares back then was catalyzed by a scenario in which a shoe shiner in the streets owned the shares. The stock market was for the rich at the time, and Kennedy thought to himself that if a shoe shiner could hold the share, then there was something wrong in the market.

In the present day, online stock trading has taken the stock investment by a storm. Anybody in the current world can own shares as it has become an online venture. The requirements are just having a computer or a smartphone. Personal brokers are nowadays not a necessity, and analyst has also predicted an impending tragedy in the field just like the Great Depression in 1929. With the accessibility of the stock market, one should take precautions before investing in the market. There are fundamental factors that one must consider.

Understand the market trend

The market shares of stock market vary according to the various times and economic conditions, the company performance and investors attitude. Most companies offer an initial public offer of their shares.

Researching and Choosing a broker

After understanding the market trend, the second basis of stock online is to select an online broker. Online brokers will help an investor store ones money in a stock account and also execute one’s trade. One must choose wisely from the many brokers in the market to avoid backlash in the business. In considering the broker, one must first plan how much the money one needs to plan and invest, and trading experience that one has in the market. One also must consider his/her needs in the stock market different brokers offer different services

Seeking the services of investor protection agencies

The Great Depression of 1929 was a big lesson that the investors and government were got unawares. As a result, many organizations and government institutes of come up with ways and means of educating investors and also safeguarding the openness of the stock market. There are many such organizations that an investor can get enlighten. Notable ones include The Securities and Exchange Commission, The National Association of Securities Dealers and the North Securities Administration Association. These organizations provide education and also advice and protection of investors shares in the market.

Account opening

When opening a stock account, one must provide a track of his/her financial track record and personal information about his financial records. This help the brokerage company to make decisions on whether you can join the market or not. There are also two types of accounts to choose from and include margin account and cash account. A margin account is more of a loan whereas a cash account one must have enough in the account.

Making the actual investment

After funding one’s account, it is now time to sell and buy accounts. The first basis of making trades is confirming the real-time stock quote in the market. This is establishing the market price of the stock in the market. After setting the amount of the stock, one can now make a market order or a limit order. A market order is sold at the current market price, whereas a limit order is going at a better rate than what you have specified in your order. One may employ the expertise of the brokerage to sell or buy shares in the stock market.

In making a stock market decision, one must also take measures against fraudsters who have taken the stock market by a storm. With the current online share market, fraudsters have mushroomed, and one can be quickly dubbed. It is therefore essential to conduct extensive research on stocks.

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