So, you want to dabble in the stock market, but you have no clue as to what to do. Making money in the market and finding good stocks to invest in can be a challenge but can also be fulfilling and fun if you do your proper research. You have the potential to make $30-$200 a day if you play your cards right so to speak. So, how do you get started with buying stocks and selling them for a profit?
The first step is to open up an online trading account. Pick the best online stock broker by researching who has the highest quality services for you, and then sign up. One helpful place toto consider using a broker is sharebuilder.com or any other broker. You may be interested in reading articles in magazines with financial information for reviews on the best online brokers available. Some examples of such magazines are Barron’s, Smart Money, or The Wall Street Journal.
The second thing you want to do is to fund your trading account by sending in a check or doing a direct deposit or wire transfer. You will have to check with the broker to see what funding options are available. You definitely need capital in order play the stock market. If you are new to this whole concepts you can start with $400-$2000. If you have anything lower than that it will be hard to purchase large amounts of stocks. Keep in mind the more shares you have of particular stock, the more cash you will make. You should also prepare yourself for losing money as this will happen when the stocks you purchased drops. Remember, trading online stocks is a gamble and you will win and lose.
Once you have money in your account, you want to begin observe and study the market for a few days or weeks. Get a good view on how the market goes up and down daily. Do not just jump in. Check the NASDAQ, S&P, and DOW, and make sure they are going up. They will keep changing, they never stay the same. Rally days may be good for you since you already have funds in the market. You want to sell your stocks on rally days, not buy them. Check out Fast Money and get an in depth look about online trading.
Purchase stocks in bulk if you foresee that particular stock making profit. Make sure you place a limit order when giving your order. This will allow you to pick the price when you are buying and selling a specfic number of shares at set price. When the market sets the price this is called a market order.
Once you place your order, wait a couple of days. If you feel it is the right time to sell then you can place a limit sell order for your shares. In example if you bought 600 shares at $1,800 and sold 600 at @2040 you will have made a $220.00 profit.
Understand the stock market can be a scary but interesting feat. Many people have gotten on the bandwagon and have made considerable gains. Remember though, do your research on how to buy and sell stocks, before you play.