Get online
If you are not online, you will need an internet
service provider (ISP) to enable this. Unlimited
broadband is now much cheaper than it was and
you should have it for fast, cost-effective access.
Update your computer
If your computer is old, or your web browser is
out of date, do the upgrades. You cannot afford
inferior technology when buying and selling securities.
The speed at which you trade may be crucial.
Open your online account
To open your online account, you will need the
relevant form, which you can download from your
broker’s website. Otherwise, e-mail the
firm, asking it to send you the form by e-mail.
Once you have printed off the form, fill it in
and sign it by hand, as the firm usually prefers
a handwritten signature. Send your completed form
to the broker. You should enclose money –
typically a minimum of £1,000 – to
open your account and provide initial dealing
funds. You can transfer further funds to and from
your designated bank account only.
The firm will issue you as a new client with a
welcome pack and password. It will hold your money
in an interest-paying account pending your first
trade.
Obtain a dealing price
To obtain a price on a stock, you will have to
type in the name of the company or, sometimes,
its EPIC code, in the box provided. The EPIC code
is an abbreviated three- or four-letter symbol
which you can look up quickly on your broker’s
website. Sometimes when you ask for a price, the
broker will quote the spread, but when you go
through the process of dealing, only the bid or
offer price is quoted.
Get your order right
When you place your order, get the numbers right.
If you order 30,000 shares when you had intended
3,000, this may not be fully retrievable. If you
make such an error, get in touch with your broker
immediately – to save time, by telephone.
At worst, the broker will probably do a cancelling
trade, and you will have to pay the difference
in price movement as well as two sets of commission.
Some brokers offer a facility for retracting your
order for a few seconds after you have placed
it. This can give you peace of mind, but it is
irksome for frequent traders as it slows down
order placement. Some brokers run an online facility
to ensure that you don’t spend more on shares
than you can afford, or sell shares that you do
not own.
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