How to Start Investing in Shares
Looking for an investment? If you choose shares, you need to be willing to put up with some risk and invest long term.
The first steps to starting an investment portfolio
One way to invest your money is by building a share portfolio. A share portfolio can help you accelerate wealth creation, but can seem daunting to anyone who is new to buying and selling shares. However, there are a number of advisory services and tools to get you started.
The first step is deciding whether you want to pay a broker or financial adviser who can help you to trade and manage your shares, or use an online platform to trade shares on your own. There are benefits to each and your decision will depend on a number of factors, including your investment goals and familiarity with trading shares.
Full-service broker or online trading platform?
Full-service brokers can trade and manage your portfolio and give advice on your investment strategy, however, they will charge fees for their services. In contrast, an online trading platform allows you to trade shares directly and usually offers brokerage savings compared with a full-service broker. You are generally not able to access any personal advice directly via an online trading platform.
Once you've decided whether to use a broker or online platform, narrow down your choice further by understanding what level of customer service and support you will receive for your fees. To help you choose a platform, consider how user-friendly and functional it is. Is it easy to understand and navigate? Can you access it from your tablet or smart phone?
Other extras you might look for include access to share quotes or research material. For some people, trading a wide range of shares and exchange traded funds (investment funds that invest in assets such as shares, commodities and bonds) are also must-haves.
The next step is to research shares you may like to purchase and when may be a good time to buy. It might be a good idea to start with a small investment, especially if you have never traded before. This will minimise your potential losses while you learn and develop your investment strategies.
Choosing your first share
One of the keys to successful trading is research. The shares and other investments you choose should be aligned with your investment strategy, which can include your short or long-term financial goals. Based on this strategy, a broker can recommend shares for your portfolio. If you are using an online trading platform, you would need to do your own investment research.
New investors often start trading shares in well-known companies because these are often perceived to be lower-risk investments. Many people prefer shares in companies where they understand the business and industry, how it makes money, how it's performing and whether it has a proven track record of delivering solid returns.
Many investors also opt for well-known shares that have a reputation for regularly paying high dividend rates. These are often called income shares. You may also decide to pursue growth shares. These are shares that may not pay a dividend but are bought for the potential of growth in their share price to increase faster than the rest of the market.
You can research companies by reading independent broker recommendations and market reports, as well as the companies’ own announcements and financial reports. This will help you learn about their business strategies and performance.
Once you buy a share, this research information should give you an idea as to the performance of the company and, ultimately, when to sell. Any research you do should be aimed at helping you understand the company and how it will be viewed by the market so you can make better decisions when investing online or assisting you to ask more informed questions of your broker or financial adviser.
Open a free demo account in 5 minutes and practice trading.
Trade CFDs on instruments from the world's most popular markets.
How can I open a Demo account?
You can choose to open a Demo account during your registration process by clicking on “Demo Mode” in the “Select Account Mode” window. You can also switch back from Real Money mode to Demo mode by clicking on “Switch to Demo Mode” in the main platform screen or from the app’s menu.
1. Open an account
To trade on oil prices with Plus500, you’ll need to open an account. It takes a matter of minutes, can be done entirely online, and there’s no obligation to fund once you’ve finished your application.
However, you will need to fund before you place your first trade. Funding a CFD trading account is simple – you can use your debit or credit card
If you’d like to try out oil trading without the risk of losing any capital, you can open a demo account instead.
2. Find your first opportunity
- You can use your Plus500 account to trade Brent Crude and WTI (Called US Light Crude on the platform), as well as Heating Oil, Natural Gas and No Lead Gasoline. And you can access a variety of tools to help you identify the right time to open your first position, including:
- Oil trading signals, which tell you when opportunities arise with details on how to take advantage
- Alerts, which notify you when certain conditions you’ve set have been fulfilled
- Technical indicators, including MACD, Bollinger Bands and RSI
- Find out more about the Plus500 Trading platform.
3. Open your position
Once you’ve decided the market you want to trade, you can open your position on Plus500 web platform, or one of our mobile trading apps.
Open the deal ticket to place your trade. First of all you’ll enter your stake, which dictates the profit or loss you’ll make when the market moves. You can also choose to add a stop or a limit here, which will automatically close your position once it hits a certain level.
Bear in mind, though, that a basic stop loss does not guarantee your position will close at the exact level you specify – if the market suddenly gaps beyond your stop level, it’s possible your position will be closed at a worse level than requested.
If you think oil is going up in value, then ‘buy’ your chosen market. If you think it’s headed down, then ‘sell’ it.
4. Monitor and close your position
Now your trade is open, you’ll want to keep a close eye on it – or use the appropriate monitoring tools – and decide when the right time is to either cut your losses or take your profits. You can also add, remove or amend any stops or limits once your position is open.
To close a trade, you just click on your position and trade in the opposite direction to when you opened it. So if you bought oil, then you’d sell it. If you’d sold oil, then you buy it.
Your profit or loss is determined by deducting the price at which you opened the position from the price at which you closed it, and multiplying the result by your position size. If you bought the market at the outset, then a positive figure indicates a profit and negative one a loss. If you sold it, then it's the opposite.
Step 1 – Open an Account
To open an account with Plus 500 - is a simple process, click here to continue. The registration is fast and easy. All needs to be done is to fill your email address and password.
Step 2 – Verify Your Account
In order to activate your account, you must provide the required documentation. Plus500 provides a simple and fast online platform which makes it an instant process. Customers are required to verify their accounts for identification and security purposes in accordance with Plus500 due diligence process.
Plus500 offers CFD trading in Forex, stock indices, individual equities, commodities, cryptocurrencies, ETFs and options. Plus500 was the first broker to introduce a Bitcoin CFD (2013). The company does not charge commissions on any of its trades. All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500's WebTrader platform. Large volume traders do not get a trading discount at Plus500. The spread is the same whether you trade one lot or one thousand lots. There are no charges for normal withdrawals or terminating an account. Inactivity fees kick in after an account has been idle for three months. Beginning traders can open an account with as little as GBP 100.
WebTrader is simple and easy to use and the layouts will feel familiar. Traders can choose from among more than 2,000 instruments, analyze their selection on a customizable technical analysis chart and place their trade in just a few clicks, all within the same window. Traders can also set price-based alerts on instruments they are following, and WebTrader will notify them via email or SMS text once the price objective has been reached.
The mobile app includes all of the same functionality clients can use in the desktop version to analyze and research trading opportunities. Clients can use conditional orders, track their accounts and receive trading alerts. The dynamic charts can be expanded to full screen to provide better clarity during the technical analysis process. Clients can also deposit and withdraw money from within the mobile app.
Plus500 has been in the CFD business since 2008. They are registered in the UK and licensed by the Financial Conduct Authority (FRN 509902). The company offers CFD trading in Forex, stock indices, individual equities, commodities, cryptocurrencies, ETFs and options. Plus500 was the first broker to introduce a Bitcoin CFD (2013). The company does not charge commissions on any of its trades. All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500's WebTrader platform. Plus500 Ltd. (PLUS.L) is a publicly traded company on the AIM section of the London Stock Exchange (since 2013) with a GBP 1.01 billion market capitalization and clients in more than 50 countries around the world.
Up to 80.6% of retail investor accounts lose money when trading CFDs with Plus500. You should take into account whether you can afford to take the high risk of losing your money. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs, regardless of provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.