Gone is the time when to invest we had to go directly to the bank branch and give the order that we wanted to invest in the stock market and we asked them to move it for the Ibex. Today it is very common for people to manage their own investments and in this article we will explain several basic concepts that you should know.
I want to invest in the stock market, how do I start?
The first thing we must know is that to invest in the stock market it is necessary to have an intermediary or a broker that gives us access to the market. A broker is an authorized and regulated entity in charge of buying or selling financial products to us on our behalf in exchange for a commission. Online brokers today are an option to take into account since their operations and commissions allow us to manage our finances efficiently.
Where should I invest?
There are many financial products that we can access such as stocks, bonds, options, futures. However, when we invest it is important to know the different risks of financial products since we may be exposed to unnecessary risks if we do not know how they work. Another important point to take into account when we decide to invest is diversification, that is, not putting all your eggs in one basket. Choosing a broker that has access to markets worldwide is important since we will have a greater range of products that allows us to diversify.
What main expenses do I have when I go to invest?
It is important to review this section since investing with a broker with high commissions can harm us when it comes to obtaining a higher return on our investment.
– Buy / sell commission: this is the main commission that we will face when we invest and is normally applied when we buy and when we sell a financial product. Normally online brokers offer fewer commissions, an example of which is the Degiro online broker.
– Custody commission: it is a commission for keeping the securities in the account. Some brokers no longer charge it or depending on the number of operations it may vary.
– Stock market fees: in the case of the Spanish stock market, a fee is charged for operating in Spanish securities. It is important to know if our broker has included the stock market fee in its purchase/sale fees or charges it additionally, since we may have surprises.
Recommendations to find a good broker
– Make sure that the broker is regulated: this point is very important since in this way we make sure that in case something goes wrong we have a place to claim. In this way we can avoid the so-called ‘financial beach bars’ and not expose ourselves to problems.
– Access to a multitude of products and markets: As we have previously commented, a broker that has a variety of products will allow us efficient diversification and reduce the risks of our portfolio.
– Low commissions: commissions hinder the result of our portfolio and for this reason it is essential to find out how much the entity will charge us for operating and if it has any hidden expenses to avoid surprises.
Degiro, ‘Best Stock Broker 2018’
The Dutch broker Degiro has been chosen for the third consecutive year as ‘Best Broker for Stocks 2018’ by the financial community Rankia. The reasons for the success of this broker with more than 45 European awards are the ease of operating and access to more than 50 markets worldwide. Degiro also offers products that allow easy diversification such as ETFs, among which it offers a
It arrived in Spain in 2014 offering very low rates for trading on the stock market and today it operates in 18 European countries and has more than 350,000 clients who already benefit from its conditions. You can open a free account through their website in Spain.
Content created in collaboration with Degiro
Note: Investing carries risks of losing your money.
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