Youve probably imagined many times how youre going to invest in stocks and make enough money to travel the world and last you for the restof your life.Achieving this is not easy, but you have to start somewhere. Purchasing shares online is one of the best ways to reach this goal. And the good news is you that can do all of this completely online, from the comfort of your own home.

In this article, we will explain jargon-free, in plain English, how to invest in stocks online. Its not as easy as watching your favorite TV show, but dont worry, its not rocket science either.

People usually ask abouthow tobuy and sell shares onlinebecause they either want to make money (profits) or gain some trading experience. Both are possible, and can also be fun, if you select the right stocks.

You canmake a profitif your share pays dividends or its price increases. If you do this in the longrun, these profits can add up and even make you a millionaire,as it happened with Mr. Gremel: the now 98-year-old investor bought 20 Walgreens shares for $1,000 in 1953, and today they are worth $2 million.

As yougain experience, you will improveyour financial literacy. This is one of the best long-term investments. Have your friends ever talked about investments or the stock market, and you had no clue what any of it meant? Dont worry, once you start investing and learning more about it, this wont happen again. Youll understand better how the stock market works and how it influences the economy, as well as your everyday life.

Lastbut not least, as a shareholderyou will be part of a companys story. Have you ever wanted to sit in the same room with Warren Buffet, and participate in a Berkshire Hathaway annual meeting? If you buy some Berkshire shares, youll have the chance, all you have to do is master the buying of the shares.

Lets take a look at the six steps for how to buy shares online!

Buying shares online is not rocket science. Follow this simple six-step plan:

First of all, you need to find a good online broker. Brokerchooser will help you here: get a free recommendation by answering a few questions, or read further to get a general broker recommendation.

When recommending a broker, we take into account the brokers fees, trading platform, accessible markets to trade, and how easy it is to open an account. Safety is also very important, but since we recommend only safe brokers, you dont have to worry about this.

After finding your online broker, you need to open an investment account. This can usually be done online. The investment account is basically what you need to start buying shares online. Think of it as a bank account where in addition to holding cash, you can also shares. Opening an account usually takes a couple of days, although at some brokers you can get it done within a day.

In order to buy shares online, you need to have money on your investment account. Usually, you can choose between a bank transfer or depositing funds via credit/debit card. At some brokers, you can fund your investment account even via Paypal, e.g. ateToro.

After uploading some money into your account, you can start searching for the best target stocks to buy. You can get inspiration from others ideas or you can do your own research. Most people listen to others, but if you put some time and energy into your research, the payoff is usually bigger and you can learn a lot more from it. Investment ideas can come from your broker in the form of stock reports and analyses, but you can also use other, independent research. The financial news and investment courses canalso be useful in learning how to pick a winning stock.

You have the account, the cash, and the stock you want to buy. Now all you need to do is press the Buy button. You log in to your online trading platform, find the stock you have selected, enter the number of shares you wish to buy, and click Buy, which will initiate the purchase of shares.

When placing an order, you can choosefromdifferent order types.Amarket orderbuys immediately at the current market price, while alimit orderallows you to specify the exact price at which you want to buy the shares. Find more details onorder types here.

Youre done, youve bought the shares, they are yours. Now it is key to monitor your investments. This basically means following your investment strategy. If you bought the shares with the goal of holding for a longer term, you might participate at the companys annual meeting and collect all the news and information about the firm.

For short-term buyers, position management could mean setting up thestop-loss priceofwhere to cut losses, and the target price of where you want to sell the shares with a profit.

Now that you have mastered the 6 steps of buying shares, take a moment to look at the top 5 brokers we have selected for you.

Trading floors have turned into well-designed tech platforms with interactive tools and charts.

If youre just starting to explore how to buy shares online, we recommend that you choose one of the following five brokers. We tested all five, and we have live accounts with all of them.

First and foremost, here is a table comparing the main characteristics of each of the brokers:

Beginners and buy and hold investors focusing on the US stock market

Beginner traders and those interested in social trading (copying other traders trades)

Price-sensitive buy and hold investors and traders looking for only execution

Investors and traders looking for a great trading platform and solid research

For onlinebrokers available in your country, check out ourbroker finder. If fees are at the top of your agenda, you will enjoy digging into theultimate fee comparison table.

Now, lets look into more details about the 5best brokers where you can buy shares:

Robinhood is a US zero-fee or discount broker established in 2013. If you dont know what discount broker means, read this overviewabout the best discount brokers in 2018. Robinhood is considered safe because it is supervised by FINRA, the US regulator and provides a maximum of $500,000 investor protection includinga $250,000 limit for cash.

US stock trading is free at Robinhood. There are no inactivity fee and withdrawal fees. On the flip side, Robinhood has really high commission for non-US stocks.

Beginners and buy and hold investors focusing on the US stock market

eToro is a well-known fintech startup, an Israeli social trading broker established in 2007. eToro serves UK clients by an FCA regulated entity and Australians by an Australian entity. Allother customers are served by a Cypriot entity. eToro is not listed on any exchange, does not disclose its annual report on its site and does not have a bank parent. It is also one of the 5 best trading platforms for Europeans. eToro is considered safe because its UK arm is regulated by a top tier regulator and it is a well-known fintech startup. eToro is a multi-asset platform which offers primarily CFDs, but you can also invest in stocks and crypto assets.CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 66% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

eToro offers free stock trading in Europe and has low fees for non-EU clients. On the negative side, the non-trading fees and financing rates are high.

Beginner traders and those interested in social trading (copying other traders trades)

DEGIRO is a trending Dutch online discount broker. Itis privately owned and was established in 2013by former employees of another brokerage company. DEGIRO is considered safe as it is regulated by top-tier financial regulators, theDutchAFM and DNB. Itis registered with the Chamber of Commerce and Industry in Amsterdam under number 34342820.

DEGIRO has low trading and non-trading fees. In most asset classes, it is the best in the market. There is one free ETF trading per month, a great offer forbuy-and-hold investors.

Price-sensitive buy and hold investors and traders looking for only execution

Saxo Bank is a Danish investment bank providing online trading and investments. It is a leading European retail brokerage innovator. Saxo is privately owned, established in 1992, and headquartered in Copenhagen. Saxo is considered safe as it is regulated worldwide by more than 10 financial regulators, including top-tier regulators, like the UK FCA.

Saxo Bank has average trading and non-trading fees.

Investors and traders looking for a great trading platform and solid research

Swissquote is a Swiss investment bank, established in 1996. It has two main arms: The Swiss arm for stocks, funds, options, and futures The UK arm for CFDs, and FX Formally, Swissquote Bank Ltd is based in Switzerland and regulated by FINMA, the Swiss financial regulator. This one offersstocks, funds, bonds, futures and options. The other, Swissquote Ltd is UK based, regulated by the FCA,the UK financial regulator, and offers CFDs and FX. Swissquote is considered safe because Swissquote Bank Ltd has a banking license, it is listed on the Swiss stock exchange,and discloses detailed financials regularly. For clarity, we will call the Switzerland Swissquote for stocks Swissquote (CH), and the UK Swissquote for CFDs and FX SwissquoteForex (UK).

Swissquote has high trading fees and average non-trading fees. As a plus, there is no inactivity fee.

We hope you were able to choose the best broker to fit your needs. In the following few paragraphs, we have collected a few good tips on stock trading, what to look for, and what to look out for.

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When you buy a share of a company, you become s shareholder, i.e.an owner, of that company in a very small percentage.

For example, Tesla has 164 million shares outstanding. When you buy 100 Tesla shares, you will be one of the owners ofTesla. Your ownership percentage will be very tiny, 0.000061% (100/164 million), but still, you will be an owner with all the rights that come with this ownership:

– when the company allocates dividends, you will receive a part of this. Staying with the previous Tesla example, lets assume that in 2020 Tesla will pay $100 million in dividends, then you will receive $61 (0.000061%*100 million).

– if you are a shareholder, you have the right to participate at the companys annual meeting. At the annual meeting, you will have the right to vote on the topics that will fundamentally influence the future of the company. These topics can vary from the electionof the board of directors to the amount of the dividends allocated.

Speaking about financial literacy: when you read about buying shares online, you may find that both the expressionsstockandshareareused. What is the difference between them? The wordstockis the general term for company ownership. For example I invest in American tech stocks like Apple and Facebook.Shareusually refers to the ownership stake in a company. For example Yesterday I bought 100 Tesla shares.

Investments always comewith some risks that you should aim to manage (click here to read more aboutmarket riskand other types of risks). Below, you can findthe most common ones and our advice on how to mitigate them.

Risk: Unfortunately, tons of scam brokers are out there on the market trying to steal your money. When you see ads for binary options trading or automated investment algorithms that generate outstanding returns, start to get very suspicious. In these cases, the best thing to do is to ignore these ads.

How to manage it: When buying shares online, go with our broker selection. We have an active account with the brokers we selected and we testthem regularly.

Risk: If you put all of your savings in just one or two stocks, and the company you selected goes bust, you could lose all your invested money.

How to manage it: Diversify your investment portfolio. This practically means buying many different shares and not putting all your eggs in one basket. The ideal number of shares in a portfolio ranges somewhere between 20 to 30.

Risk: when buying individual stocks, there is always a risk of selecting the wrong ones. Here, wrong could mean anything from a company that defaults to just buying an overpriced share.

Learn: This is thetricky part, since you need some knowledge and experience. The best is to start learningby reading books on investment and taking online courses. There are tons of great books out there, but you can start with theIntelligent Investorby Benjamin Graham. This is also the book on investment most recommended by Warren Buffet.

Gather information: While you are learning, startcollecting as much information about your target companies as possible. Readnews about them, understand their business profiles, start playing around with their income statements, gain some knowledge about their management background or even attend their annual meetings. These will help you gain a better understanding of the company and the specific industry.

Compare multiples: When it comes to pricing, useindustry multiples as a proxy for your target stock. P/E is a basic multiple, but each sectorhas its own favorite.

Since you are trading with your savings, it is very important to pay attention to safety. The online brokersweselectedhave some of the best protectionschemes, the level of which depends on the regulatory body of the broker (learn more aboutinvestor protection).

Robinhood is regulated by the top-tier FINRA. There is also a high, $500,000 investor protection amount. Robinhood is not listed on any stock exchange and does not disclose its financial information.

eToro is regulated by top-tier regulators, the FCA and the ASIC, and also by Cysec. However, it is not listed on any exchange, does not disclose financial information and does not have a bank parent.

DEGIRO is a licensed investment firm regulated by Dutch Central Bank and Netherlands Financial Markets authorities.On the flip side, the information you can access about the company is limited.

Saxo Bank is regulated by several financial regulators, including the top-tier FCA. It is alsoa fully licensed Danish bank and provides negative balance protection. On the flip side, Saxo is not listed on any stock exchanges.

Swissquote is regulated by top-tier regulators, it is listed on the Swiss exchange, discloses its financial statements and has a banking license.

Denmark, UK, France, Switzerland, Singapore, UAE, Japan, South Africa, Australia

$500,000 (securities up to $500,000, cash up to $250,000)

50,000 for UK residents, 20,000 for residents of non-UK countries

100,000 for cash deposits and 20,000 for securities for most European countries

CHF 100,000 at the Swiss entity, 50,000 at the UK entity

You can compare the protection amount among all reviewed brokers.

In your country of residence, you may have the option to open special investment accounts that offer favorable tax conditions. For example, in the UK, this account is the ISA, the Individual Saving Account, which isexempt from income tax and capital gains tax on the investment returns.

How to purchase shares online? How can I buy shares? I want to invest in shares online! I want to buy shares! – Were these things you were sayinguntil now?

Just follow these six easy steps to buy shares online:

It may look tricky at first, butall youneed to do is go step by step. See you at the next Coca-Cola or Berkshire annual meeting!

If youre still in doubt about which broker to choose, we compiled a briefsummary to help:

Beginners and buy and hold investors focusing on the US stock market

Beginner traders and those interested in social trading (copying other traders trades)

Price-sensitive buy and hold investors and traders looking for only execution

Investors and traders looking for a great trading platform and solid research

Gergely is the co-founder and CPO of Brokerchooser. His aim is to make personal investing crystal clear for everybody. Gergely has 10 years of experience in the financial markets. He concluded thousands of trades as a commodity trader and equity portfolio manager.

Everything you find on Brokerchooser is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback.Read more about our methodology

By trading with securities you are taking a high degree of risk. You can lose all of your invested money. You should start trading only if you are aware of this risk. is not providing any investment advice, we only help you find the best broker suitable for your needs.

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