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Introduction to Buying and selling financial Securities

This article covers the Buying and selling financial Securities which are among basics of the investing process. We already know what an investment is as discussed earlier including the steps in the investment process. We begin by describing how you go about buying and selling securities such as stocks and bonds. Then we outline some important considerations and constraints to keep in mind as you get more involved in the investing process.

Getting Started Buying and selling financial Securities

I will try to break the process down and make it as simple as possible to help you understand what happens in the investment environment. This can be made simple by the diagram below. Buying and selling financial Securities

  1. Open a brokerage or Trading Account; The first step is to make sure you have a trading account in which all the trading transactions will be taking place. Check out guidelines on chosing a broker so that you dont make a mistake in this initial step. Be keen on the type of brokerage account you open.
  2. Deposit money into the account: Once in possession of a trading account, the next step is to avail funds into the account to offset the trading activities.
  3. Buy Securities; The next obvious step is to buy stock. the best basic practice is to buy securities that are underpriced in relation to the market value at that time and off coz other factors come into play.
  4. Sell Securities: In trading securities, assuming you made the best decision in buying the securities, you are required to sell the securities in possession once the prices go up. “First you buy a stock. If it goes up, sell it. If it doesn’t go up, don’t buy it.”~ Will Rogers.
  5. Withdraw money; When you are satisfied with the profits from trading and wish not to continue with trading, you can withdraw your funds from the trading account. You can as well do withdrawals in between trading sessions without necessarily clossing the account. This solely depends on the respective broker you are dealing with.
  6. Close account: This is obviously the last of the steps if you wish to discontinue Buying and selling financial Securities. Do close your account after withdrawing your gains.

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