How do you use a computer to invest in shares?


Quick Answer

Prospective stock traders who want to use computers to invest in shares need working Internet connections and enough money to open online trading accounts, explains NerdWallet. In addition, prospective traders need to know how to select suitable brokerage firms and the right stocks. Once these requirements are fulfilled, traders can use their computers to purchase and sell shares.

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Full Answer

Traders use computers and Web-based brokerage accounts to place investment orders and deposit funds, explains NerdWallet. While brokerage firms typically offer these accounts for free, they require users to deposit specified amounts of money before using them. In addition, these firms charge a commission for every transaction they handle, a factor that users should consider before placing buy or sell orders.

Picking the right broker depends on the trader’s personal circumstances and investment goals, explains NerdWallet. For instance, investors who intend to conduct frequent trades should look for brokerage firms that charges low commissions, while those on small budgets should seek brokerages that require small opening balances.

Apart from stocks, traders can use their computers and trading accounts to purchase other types of securities, suggests NerdWallet. For instance, they can buy into mutual funds, professionally managed firms that pool funds from many people and invest in instruments such as shares and bonds, or exchange-traded funds, investments that track indexes such as the S&P 500 and are traded in a similar fashion to stocks.

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