|
 There's
no shortage of online brokerages available (just watch TV for an hour or so and it seems like every other commercial
is for an online brokerage!) Choosing a brokerage, though, has a great deal to do with what your goals are as well
as the availability of the capital that you want to invest.
For many investors, beginning the process of investing online can be a daunting one--which brokerage to use, what
stocks to buy, etc. Another potential problem is the amount of cash that you want to invest. For example, what
if you have $100 to invest in a given month, yet a single share of the stock in which you are interested has a
value of $175?
Investing
on a Smaller Scale
Stock ownership by private individuals is at its highest
level in history. Even with the peaks and valleys we've seen so far in the year 2000, return on stock market investments
in the last 5 years has been near phenomenal, largely due to gains in the technology sector. For many families,
just getting started in stock ownership is the biggest hurdle. With many stocks trading in the $100+ per share
range, investing in even a single share in a single company can be difficult. Dollar-based investing has changed the
picture, though. Dollar-based investing lets you buy shares of stock in dollar amounts. This allows you to invest
according to your budget by purchasing partial shares. You can make a recurring investment every month, or make
one-time transactions when they are convenient. ShareBuilder.com
has an excellent program where you can choose from over 3000 stock and index products, investing on your budget
and time schedule. Click here for more information.
Some Sources for Online Investing
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ShareBuilder.com
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| Dollar-based stock investing. You can open an account with as little as
$10 and invest as much--or as little--as you want on a regular or an occasional basis. You can purchase stocks
in dollar increments rather than by share. |
Hints on Online Brokerages
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H
I
N
T
S
|
Invest sensibly. Since
there are no guaranteed returns in equity investing (unlike money
markets or CDs) invest only money you can afford to lose. |
| Think long term. Stock
market returns in 1999 were an aberration (large returns in a short amount of time). The year 2000 has already
shown that investing is a long-term proposition and should be approached with that in mind. |
| Market fluctuations are normal.The
stock market does not always go in one direction (up). Stock prices naturally rise and fall over time. Experience
has shown that quality stocks will almost always show growth in the long run. |
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