Learn how to invest in stocks on the stock market in just 4 steps

When an investor buys shares in a company, he is actually investing in the capital of the company and can get the same share of profit.

For the company, stocks bring more money into cash and become part of its investments used in its activities.

The shares of the companies are traded on the Stock Exchange. To invest, you will need to buy the desired amount through a broker, and the whole process can be done through the Internet.

How to start buying stocks: step by step

1. Find a broker and open an account

Through a brokerage account there is direct access to the purchase and sale of shares listed on B3, the São Paulo Stock Exchange.

On the B3 website, all authorized brokers are selected. Research each one and learn about the brokerage or administrative fees that may be charged.

2. Transfer your money to the brokerage account

To start buying stocks, transfer the required amount from a bank account to the broker’s account.

3. Analyze which companies you want to buy shares from

With money in mind, and before you really start investing, you need to know the companies you want to buy stocks from. This is because you will own the parts you buy from each company.

In this process, get to know in depth the activities carried out by each company. Look for the accounting reports that are available online and finally analyze how the stock price has performed.

Through the broker’s online account, it is possible to use Home Broker. This system is used to analyze quote information and issue purchase or sale orders.

4. Start building your equity investment portfolio

The Home Broker must show the different prices that the shares of each company are trading at this time. For each security, it is possible to decide the number of shares that you want to issue the purchase order.

When you buy stocks in different companies, you will create a portfolio of stock investments. Then you can receive part of the profits of each of them, as well as sell and buy new shares.

It is worth remembering that  investing in stocks corresponds to equities  . The value that stocks can achieve in the future and the profit that each company achieves are unpredictable and can generate many gains and losses for those who invest.

So, diversify your risk by building a portfolio with stocks from different companies.

When in doubt, seek help from the managers of the broker who has an account and always continue to learn the best ways to invest in stocks.

How to reduce risks when investing in the stock market

Becoming a shareholder in a company can create risks for invested capital, as even the largest companies can collapse at an unexpected time.

To avoid a good part of these risks, a fundamental rule is diversification, that is, buying shares in different companies and building an investment portfolio.

Some stocks will have higher returns and some will have lower returns. In the end, what you can get is the average of these gains, due to diversification.

When starting to invest, try to alternate part of the capital in equities (stocks) and another part in fixed income, such as Treasuries, for example. The whole process can be done and accompanied by the Home Broker offered by the broker.

Costs for investing in stocks

Each brokerage firm collects its brokerage fee for each transaction executed, in purchase or sale, which can be a fixed amount or a variable fee.

On the Stock Exchange side (B3), there are trading and settlement fees on the value of the transaction. There is also a monthly custody fee for custody of shares.

How the sale of shares works

In the stock market, different types of companies participate, that have different types of businesses, in search of more capital.

Each share is a very small division of the company’s capital. The prices of their quotes vary according to supply and demand on the stock market and some can be bought even with little money, such as R $ 5 or R $ 10, for example.

To enter the stock market, a company must launch its shares for the first time, to the first buyers, through the primary market. This process is known as IPO (  initial public offering  ).

In the secondary market, the shares begin to trade for the second time. This part of the Stock Market exists, mainly, so that there is greater liquidity among the shares and sellers can resell their shares whenever they want.

Investors who purchase shares in a company will periodically receive dividends, which are portions of its earnings. The money paid in dividends goes directly to the account opened with the broker.

At least 25% of profits must be distributed as dividends to shareholders and in some companies the proportion can be much higher. This information can be consulted with the broker itself.

Another factor to consider is that there are two types of actions:

  • Ordinary  , known as ON
  • Preferred  , known as PN

Whoever acquires ON shares wins the right to vote at shareholders’ meetings. The owner of the PN has preference in receiving dividends, in addition to being more easily traded on the Stock Exchange.

Some investors choose to profit from stocks by buying and selling, exploiting price differences on the same day, buying at the lowest value and selling at the highest value. This process is known as  Day Trade  .