Investing World Today

Reader Question – Beginning stock market questions?

Many of you like the questions and answers on this blog. I just found another one from ‘falken231′ who asks

I’m wanting to get in the stock market have a few questions.Most online sites say something like “only $7 per trade” so how does that work? If i see a stock going for $0.10 and I want to buy $50 worth (500 shares) does it then cost me $57 and I got my 500 shares? What if I only want to buy 5 shares?Another question is buying/selling.Say I look up “F” (Ford) for example, and their stock is roughly $7 per share. Can I freely just buy however many stocks I want and sell them back at any given time? Or do I have to find a seller and later find a buyer before trading them?

Answer: You pay the $7 to buy whatever quantity you want to buy, even one share if that’s what you want, and you pay $7 again when you want to sell any of your shares. If you bought 500 shares originally but now want to sell only 100 or 12 of those shares, you can do that. You don’t have to find a buyer or a seller. That’s what you pay the $7 per trade for, for the services of a broker. A broker is someone who acts as a middle man between those who want to sell and those who want to buy. It’s their job to match up the two. The only time you might not be able to sell or buy the shares you want within a very short time (mere seconds usually) is if that particular stock doesn’t happen to have any interested parties at that moment. I think the longest I’ve ever waited to sell a stock is about 15 minutes. That’s very unusual.

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