You wish to begin investing your financial savings and also you surprise tips on how to purchase shares on the Stock market ?
On this article, I clarify tips on how to purchase shares on the stock market.
A share is what permits you to assist an organization develop along with your cash.
The Inventory Change is the place buyers purchase and promote shares of firms.
On the finish of this text, you’ll know tips on how to purchase your first shares on the inventory market.
1 – Open an account to purchase shares on the inventory market
To purchase shares on the inventory market, it is advisable to open a securities account.
In France, you have got the selection between three accounts to purchase shares on the inventory market:
The PEA and the PEA-PME are securities accounts with tax benefits.
The securities account
The securities account is the essential account for investing within the inventory market.
Your securities account permits you to purchase something that’s on the market on the inventory market. For instance, you should purchase shares of French, German, American and even Japanese firms.
The Fairness Financial savings Plan (PEA)
The Fairness Financial savings Plan (PEA) is a securities account with a tax benefit.
You pay much less tax than with a securities account should you hold your PEA open for greater than 5 years.
In return, you’ll be able to solely purchase European firm shares with a PEA.
Afterwards, you can’t pay greater than €150,000 into your PEA.
The PEA-PME can be a securities account with a tax benefit.
Just like the PEA, you pay much less tax than with a securities account should you hold your PEA-SME open for greater than 5 years.
Then you’ll be able to solely purchase shares of European small and medium-sized firms (SMEs).
Lastly, you can’t pay greater than €225,000 into your PEA-PME or greater than €75,000 if you have already got a accomplished PEA.
2 – Calculate your taxes
Then discover out concerning the taxes you’ll pay:
- on the cash that your shares will convey you (dividends);
- on the cash you’ll earn should you promote your shares for greater than you purchased them (the capital achieve).
With a securities account, you pay 30% tax on the cash you earn on the inventory market. With a PEA or a PEA-PME, you pay 17.2% tax should you hold your PEA open for greater than 5 years.
You then pay taxes with a securities account as quickly as you earn cash. With a PEA or a PEA-PME, you solely pay taxes once you withdraw cash.
You’ll be able to open a securities account with a dealer.
3 – Select a dealer to purchase shares on the inventory market
A dealer is the middleman that permits you to purchase and promote one thing on the inventory alternate.
Your dealer could be a conventional financial institution, a web-based financial institution or a web-based dealer.
There are a number of inventory exchanges on this planet: the Paris Inventory Change (Euronext Paris), the London Inventory Change (London Inventory Change) or the New York Inventory Change (New York Inventory Change).
The providers of your dealer
Every dealer permits you to purchase shares on a higher or lesser variety of inventory exchanges. Most frequently you should purchase shares on European and American inventory exchanges.
Open your securities account with a dealer that permits you to purchase the shares you need.
If you wish to purchase shares of the American firm Apple, select a dealer that permits you to purchase shares on NASDAQ, one of many American inventory exchanges.
If you wish to purchase shares of the French firm Michelin, select a dealer that permits you to purchase shares on Euronext Paris, the Paris Inventory Change.
Make sure that your dealer permits you to purchase the shares you need earlier than you open your account.
Your dealer’s charges
Then, every dealer prices you a charge to purchase and maintain your shares.
Your dealer prices you brokerage charges each time you purchase or promote one thing on the inventory alternate.
Your dealer can also cost you custodian charges to maintain your shares.
L’Financial Markets Authority exhibits that conventional banks have greater charges on common than on-line banks or on-line brokers.
Examine dealer charges with one another earlier than opening an account.
4 – Place a inventory market order along with your dealer
Upon getting opened your securities account with a dealer, you begin by depositing cash into your account.
Then you’ll be able to place a inventory market order. You place a inventory market order along with your dealer asking him to purchase or promote you one thing on the inventory market.
Your dealer supplies you with an funding platform (or buying and selling platform). You’ll be able to connect with this platform through the cell app or your dealer’s web site.
Right here is for instance the cell funding platform of the dealer Degiro:
Hook up with your dealer’s funding platform to put a inventory market order.
Give your dealer the next data:
- Route of the operation: buy;
- The amount or variety of shares you wish to purchase;
- The kind of inventory market order you employ;
- The value restrict you set in response to the order you select;
- The validity interval of your inventory market order.
Right here is an instance of a inventory market order:
Your dealer then presents you with a abstract of your inventory market order with the charges you’ll pay. After verifying this data, you’ll be able to affirm your inventory market order.
Your dealer will then search the marketplace for a vendor prepared to promote you the shares on the value you ask for.
When your dealer finds a vendor, he makes use of the cash accessible in your account to purchase the shares. They are saying he executes your inventory market order.
Lastly, your dealer information in your securities account the amount and the value at which he purchased the shares.
Opening and shutting of the Inventory Change
You’ll be able to place a inventory market order along with your dealer at any time. On his facet, your dealer can execute your inventory market order solely when the monetary market is open.
In different phrases, you’ll be able to solely purchase shares when the market is open.
The inventory market of the Paris Inventory Change is open Monday to Friday from 9 a.m. to five:30 p.m. Click on right here to know the opening and shutting hours of the monetary markets.
If you happen to place a inventory market order when the market is open, your dealer can execute your order instantly.
If you happen to place a inventory market order on the weekend, your dealer will search to execute your order the next Monday as quickly because the market opens.
In different phrases, you can’t purchase shares when the inventory market is closed.
Your certificates of title
Your dealer can challenge you a certificates of possession of securities.
This doc certifies that you’re the proprietor of the shares of such or such firm.
Right here is an instance of a certificates of securities from the dealer Bourse Direct:
So now you know the way to purchase shares on the inventory market.