• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

My Wealth Manifesto

Personal Finance Tips for Every Day

  • Saving
  • Spending
  • Invest
  • Debt
  • Work
  • About Us
  • Advertise
  • Contact
  • Guest Post
  • Privacy Policy

Dipping Your Toes Into Online Investment Opportunities

November 18, 2018 Mr WM Leave a Comment

stock-market-quotes-in-newspaperIn the business world the value of stocks are ever varying, making stockbroking very lucrative but also very risky. Simply put, stockbroking is the service of buying and selling stocks and shares in the market either by an individual or a firm. The aim of stockbroking is to sell the shares at their highest prices and buy them at their lowest but with promise of gaining value. Currently stock brokering is being carried out electronically and is sometimes referred to as E-trading, involving trading of securities such as stocks, foreign exchange or financial underlying such as assets.

Therefore, an individual requires both the knowhow of the rising and falling of the stock markets and to always be up to date with the financial health of various company shares. The profession of a stockbroker can even apply to an individual with money to invest but who lacks the business knowledge or has a very demanding schedule, as they are able to seek out a proper stockbroker to assist in navigating the treacherous waters of the stock market.

Due to technology and the large number of people exploring stockbroking, firms have been established to undertake trades on behalf on the clients for a fee both over the counter and in virtual markets.

An example of such a trading platform is CMC Markets, who are regulated by the Financial Conduct Authority. The services provided by a stockbroker include: Execution Only (the stockbroker doesn’t offer advice but undertakes trades on behalf of his or her client), advisory (the stockbroker offers advice on trade areas but only undertakes the trades the client has approved) and discretionary (the stockbroker trades on the client’s behalf without any consultation).

The involvement of the stockbroker will depend on the needs of his or her client. Considering the high dependence on the stockbroker, the firm or individual should be chosen with care and should be registered with the right institutions. The legitimacy can be checked from specific databases from either government or union based sources. Some brokerage firms offer both Contract For Differences (CFD) and share trading and even credit services or collateral.

The obligations of the brokerage firm or stockbroker include researching the markets for the best trade offers in order to give profound, latest and accurate information that should include stock prices and quotes, and offering the client margin loans (collateral for credit services which can be the cash deposited in the account) so that the client is able to do more share trading.

There are various types of stock trades which are market orders, limit orders and stop orders.

The market order is at times referred to as the standard order and is the most common. It is an order for a number of shares to purchased or sold at the best price possible.

The ask price is the amount that is paid while buying, the bid price is the amount that is received after selling and the difference of the two prices is known as the spread. For stocks that are traded frequently the ask price is usually higher than the bid price hence the spread is usually narrower.

Limit orders enable the client to state the price at which s/he will sell or buy a specified amount of shares which assures the client of getting the price s/he desires for example a client may want to sell 50 shares at £17.The disadvantage is that the specifics quoted may not be achieved within the trading period hence the order expires.

Lastly, stop orders which is common and is at times referred to as a stop loss order. There are two types: a buy stop order and a stop sell order. A stop sell order is placed under the current market price and when the price of the stock hits that mark then the order turns into a market order and is filled obviously with the highest prices. A buy stop order is used in higher levels of investment and is placed above the current market price.

The stockbroking industry is very profitable but requires caution in its exploiting. The right trading platforms should be used so as to gain the most from the trades which is done through proper research of brokerage firms.

 

Featured image courtesy of Flickr | Andreas Poike

Share this:

  • Click to share on Facebook (Opens in new window)
  • Click to share on Twitter (Opens in new window)
  • Click to share on Pinterest (Opens in new window)
  • Click to share on LinkedIn (Opens in new window)
  • Click to share on Reddit (Opens in new window)
  • Click to email this to a friend (Opens in new window)

More Posts You'll Like:

Ten Ways Stock Investments Can Be Used With Your Credit Card Debt Reduction Strategies How to Get the Best Out of Your Silver IRA Rollover forex marketThe Most Commanding Forces in the Forex Market Today How to Make Money Investing in the Housing Market

Invest

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Primary Sidebar

NEVER MISS A NEW POST!

Enter your email address to subscribe to this blog for free and receive notifications of new posts by email.

More Great Reads!

4 Passive Income Ideas I Learned From Robert Kiyosaki

How to Do a Complete Self Audit of Your Financial Situation

How to Prepare to Apply for a Home Loan

Financial Tips for Getting Back on Track

Are You Walking a Money Nightmare? Financial Tips for Getting Back on Track

How to Choose Your Family Health Care Insurance

How to Choose Your Family Health Care Insurance Wisely

Retirement Saving Starts Now! Where to Begin

5 Tricks You Can Use to Cool Your Budget for the Summer

Common Financial Mistakes

5 Common Financial Mistakes We’re All Guilty Of

How to Make Money on the Side During Retirement

How to Make Money on the Side During Retirement

Improving the User Experience in Video Collaboration

Footer

About Us

My Wealth Manifesto is a collection of personal finance tips and tricks that you can use to save more, spend less, and invest securely.  Read more at MyWealthManifesto.com

Categories

  • Debt
  • Invest
  • Saving
  • Spending
  • Work

Archives

Disclaimer: My Wealth Manifesto is for entertainment and reference purposes only. We are not licensed financial professionals. The work here is the opinion of the author and should not be interpreted as an endorsement for specific investments, products, or services. Always seek the advice of a true professional if you truly are in need of help.

Affiliate Disclaimer: Some of the links on My Wealth Manifesto may be compensated for affiliate relationships with advertisers such as Google Adsense, Amazon Associates, and other third party interests.

© Copyright 2016-2019 MyWealthManifesto.com · All Rights Reserved · Powered by WordPress

loading Cancel
Post was not sent - check your email addresses!
Email check failed, please try again
Sorry, your blog cannot share posts by email.