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What Is a Stock and How Do I Buy One?

Stock is a type of security that signifies ownership in a corporation and represents a claim on part of the corporation’s assets and earnings.” (Investopedia)
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When you purchase a stock you are investing in a company, ideally a solid one that will provide returns on your investment by performing well for years to come, which will raise their stock price.

You’ve heard of people investing in start-ups, when you buy stock your investing in a company that is already well-established such as Amazon or Facebook, some of the best performers in the market over the past couple years.

How do you buy a stock?

First decide if you want to go through an electronic broker or a face to face broker. Some electronic brokers include, E-trade.com, TD-Ameritrade, and Center point securities. They all have their pro’s and con’s.

Then pick a company you want to purchase stock from, which comes after you do extensive research and have come to your own conclusions why you think it’s a good investment.

Set an order to buy the stock through your broker and there you go, you’re now an investor in that company.

32 COMMENTS

  1. How do you obtain the returns on a stock that you purchase? Let’s say you buy a share of stock from Orange company. Orange just started, but it’s doing well. The stock price is $0.50, so you buy 1,000 shares ($500.) In 2020, the stock price is $50 ($50,000.) How do you cash this out?

    • Awesome question! So the goal here is to buy low and sell high, the stock, let’s continue with orange company stock has reached $50 and you think it’s time to cash out, you go to your broker, whether you chose online or face to face and sell the stock through them. If it were online you enter an order to sell the stock and then you get the cash for those stock shares and the company gets there stock back.
      Hope this helped!

  2. By buying stocks willvyou get dividends income?
    Like for example i the comment above for ORANGE company will i get extra money or i just have to sell the stocks at higher price?
    Thank you

  3. Hello @Investingsimple your blog is such a great help. But I am in Kenya currently and want to buy American (USA) stocks. Is there a way I can do that? Are there any legal implications. Thank you.

    • I’m not too sure which brokers allow you to invest in the middle eastern markets but to invest in American stocks you’d have to use an international broker like interactive brokers.
      Hope this helps!

  4. Hello @Investingsimple your blog is such a great help. I live in India and want to buy American (USA) stocks. Is there a way I can do that? Are there any legal implications.
    Thank you.

  5. Hello @investingsimple great blog! New to stocks wanted to start day trading for passive income any advice I just download Robin Hood. Thanks

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