Buying and selling stock

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Buying and selling stock

  1. 1. The Stockbroker Goes through training and testing to become a registered representative of the NASD Can provide advice Follows various industries and companies to compile investment information
  2. 2. Let the Buyer Beware  A full-service stockbroker is a salesperson first and an advisor second  The broker ultimately has to sell the product to you
  3. 3. Placing an Order Verbally over the telephone Through touch-tone automated system Over the Internet
  4. 4. First Basic Kind of OrderMarket Order You want to buy or sell a certain number of shares of stock at the best current available price and you assume your order will be executed as soon as possible.
  5. 5. Second Basic Kind of OrderLimit OrderYou want to buy or sell when the stock reaches a certain price. You will not buy or sell if the specified price is not reached
  6. 6. Third Basic Kind of OrderStop Order Your order to buy or sell at a specific price changes to a market order when the specific price is reached
  7. 7. Types of Accounts Cash accounts  Required to pay for your stocks purchases within 3 business days of your order  Especially useful for beginning investors Margin accounts  You are actually borrowing money to purchase stocks  Should be an experienced investor
  8. 8. Selling Short  Margin accounts are sometimes known as selling short  Investor is selling borrowed stock  Will pay for it later  Betting price will drop between the time of sale and the time of purchase, so he can pocket the difference  If the price rises, he loses money

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