A Beginner’s Guide to Online Share Dealing
As one of the world’s most popular forms of investment, share trading no longer falls into its former stereotypes. While the nature of the business comes with risks and lows, it also comes with the possibility of abundant profitability.
It could be argued that the rise in prominence of ‘online share dealing accounts’ has made trade sharing both easier and cheaper for everyone. The market now offers private investors a number of different shares account options of which they can trade through.
This article will cover the fundamentals of trading shares and online share dealing, in order to provide readers with a balanced summary of these topics.
Trading Shares: The Basics
In essence when you are buying shares, you are buying a small part of a company listed publicly on the Stock Exchange.
The amount of the company that you own is dependent on the number of shares you purchase. For example, if 200 shares are available and you buy 20, you will obtain a 10% stake in the company.
People tend to invest in shares as a means of making money. As you are buying yourself a stake in the business, the value of your shares is likely to increase if the business grows.
Other share options pay out dividends; sums of money paid out to shareholders based on the company’s profit. Dividends can provide a good source of additional income however they tend to be of relatively small amounts.
Most shareholders make profit by selling their shares on for higher prices than they purchased them for.
Obviously, trading shares is not without its risks; share prices can fall as easily as they rise. There is also no guarantee that the company you invest in will make profits. Therefore it is important to ensure that thorough research is executed and and that you keep an eye on your shares and the market. Moreover, it is important to realise that you could lose some or all of your capital and you may not get back everything you put in.
Keeping your shares in an online account can be a good method of organising and managing the process effectively.
Online Share Dealing
Online share dealing accounts are becoming one of the most popular options. They are very easily accessible and comprehensive to use meaning that all share dealing is completed through a central hub. It also makes the process easily manageable as all trades are carefully recorded and administered through the account.
For those who are just starting out with share trading, you can opt for an advisory account where you are in control of your trades but advice, guidance and recommendations are provided as necessary for experts in the field.
As for those with stock trading knowledge, an execution-only account may be better suited. These offer no advice or guidance, just a location for you to trade efficiently. Because of this, they tend to be the cheaper option with a low flat-fee charged per trade.
One of the key advantages of online share dealing is the speed factor as share trading often requires the need to act quickly. Having said this, most online share dealing accounts can also be accessed by telephone for the more traditional method.
How do I find the best online share dealing account for me?
Whether you are starting out or an experienced trader, it can be challenging to find which option works best for you.
Seeking expert advice on online share dealing accounts can help you to compare the different providers on the market, finding the most effective offering for your circumstances.