Stock is a long term investment, but many people consider it as a short term investment to quickly make profit. However, short term investment is riskier due to the fluctuations in a volatile stock market. This means you can win a lot and loss a lot quickly. With stock as long term investment you have a greater change to profit. It’s all depends on you, whether you want stock as short term or long term investment. Whatever your decision is, there are advantages and disadvantage in every kinds of investments.
There are two basic methods where you can buy stock: on the exchange floor which is more traditionally or electronically where more technology is used. The trading on traditional exchange floor is basically what most of us have seen it in the movies. But there is a growing trend these days that trade stocks electronically. Through electronic trading, your order can be executed much faster.
With the advance technology these days, online trading is becoming very common. You can order stock from your house using the internet. Your order will be executed instantly. To use online trading you must first choose an online stock broker. There are some very important factors that may help you determine a broker.
Browse the internet and take note of several brokers you want to use for their commissions, which are the costs of buying and selling stocks. Aside the commission fee, you will also need an initial deposit which might range from $500 to $10,000. If your account balance is less than the minimum, your broker may charge you monthly fee. Another thing you should consider when choosing a broker is their tools and features which is integrated in your trading account. Find out if they charge you for this feature.