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I'm new to the game and want to invest $1,000 into the stock market. I want to buy stocks low and when they rise to a nice profit I want to sell sell sell. Thing is I have a couple of questions. Lets say I have 1000 shares of a stock, If I chose to sell them are all stocks instantaneously sold at the current price? If not, can someone please tell me how all that works. I only plan on makeing maybe, 20 trades a month so, which online trading site would be best? I'm considering scottrade but if there are better options I would like some of your input
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I'm going to give you the advice I wish someone had given me, instead of nonsense advice I got from people I thought I could count on. And I'm a stranger.
Use a low-priced real direct access stock broker. For you, I recommend Interactive Brokers. They will charge you as low as $1 per trade. With $1,000 you don't want to get charged more than that. Here is the cream: Play $20, $30, $50 stocks. In those stocks, even with a 2% gain you can make money. Don't fall into the delusion that pennies will make you a millionaire. If anything, they will make you broke.
Also, don't spread yourself too thin (eg., I would trade only one stock with $1,000 if I were you.)
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And if you trade NASDA, AMEX, OR NYSE stocks, yes, all the shares would sell instantly at the same price. But if you buy OTC or Pink Sheet stocks..you have to use Limit orders and that's trickier..that's why I just recomend NASDAQ stocks discussed at the lion. Here's the link..
Well first with $1000 you can't make 20 trades a month. Cause you can only open a cash account. With a cash account when you by a stock and sell, after you sell it, your funds will take 3 days to settle. You could buy a stock before the 3 days, but you still wouldn't be able to sell it untill those 3 days, even if the stock went down. So to be safe, you shouldn't buy a stock until your funds settle, so you have the freedom to sell right away if you want to.
If you have $2000, you can get a margin account, and there is no settlement period. Your funds will be ready right after you sell the stock. The only thing is, you're only allowed 3 round trips in a 5 day period. A round trip is when you buy a stock and sell it in the same day. You can buy a stock 1 day and sell it the next, and that's not a round trip, so you can do that as many times as you want. But most traders sell the same day, or even sell with in a few minutes to an hour after a stock moves quick on good news.
I would recomend Scottrade. That's what I use. It's a good broker that's easy to use, and trades go through quick. You don't need a direct acces broker untill you get $25,000 and can be an official day trader. The law is you need to have 25k in a margin account in order to day trade. That means you can trade as many times as you want, and never have to worry about funds settling either. You can call scottrade and ask what ever questions you have. You can sign up on the internet then wire transfer the money to scottrade and start tommorow if you want. That's what I did. It's that simple
Since you're new, I would recomend only trading NASDAQ stocks under $5 with Microcaptrade. In the Morning before 9:30 eastern, bring up the top 400 and uncheck the otc and pink boxes at the top, so only the NASDAQ stocks are showing. The stocks up with the most trades pre-market, and with news, usually move at least 5-15% right at opening bell.
And don't worry about the price of the stock or the # of shares you own...Only worry about the percent you gain or loose.
If you a few shares or a $100 stock with your thousand dollars, or if you buy a whole buch of shares of a $3 stock with your thousand dollars...you still have one thousand dollar's worth of stock. If either of the stock goes up 10% you have made 10%...it's all the same.
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