Best place to Start investing

Fol20

As it stands im a student with a few hundred to spare.Im interested in how markets operate and wouldnt mind venturing a few hundred into them.The only problem is the that the costs involved with investing a small amount of money is way too high.Brokers charge a yearly fee combined with every transaction you make.With this in mind,half of the money you invest will be gone by the time you put it in.I was wondering can anyone point me in the right direction and give me advice on how to set up an account with a cheap reliable broker both online or in offices.

pirelli

Fol20 wrote: »

As it stands im a student with a few hundred to spare.Im interested in how markets operate and wouldnt mind venturing a few hundred into them.The only problem is the that the costs involved with investing a small amount of money is way too high.Brokers charge a yearly fee combined with every transaction you make.With this in mind,half of the money you invest will be gone by the time you put it in.I was wondering can anyone point me in the right direction and give me advice on how to set up an account with a cheap reliable broker both online or in offices.

Invest in options. In this way you invest a fraction of the real value with a promise to buy when they reach a certain price. With some companies you cant lose. I.e to purchase 5000 wells fargo would cost 35,000 euro in stock, but in options you can purchase a contract for 5000 shares for 5000 euro with a promise to buy at a certain price.

Or spreadbet.

eire2009

Sharewatch is only 60e yearly and only charge 20e or 0.3% of the value of the transaction.

Its a good bit of fun watching them go up and down aswell

MrMatisse

stocktrade.co.uk

FlyOver

I've got €500 to invest. I want to make a quick buck, simple as. What are the best options? Spreadbetting? Shares?

Not interested in sticking it all on Red at the roulette table

pirelli

Firsttrade ( usa) , you can set up an (international ) account immediately and trade for 6 dollars at a time. You must wire money from your bank to deposit money , It is more straight forward than it sounds. If you want to trade pennystock use Zecco or TD americtride as first trade charge high fees for pennystock.

Fol20

Can you explain options and spreadbet a bit more,i googled it and find it a bit hard to understand.I know there are terms such as put,write etc but i dont really understand it.What is spreadbet aswell.

Id go with sharewatch just a 60e annual fee combined with 15e min commission fees means you have to really be investing thousands into it really to see a return.From what i have read even though i dont understand it,the general consensus is that options save in the amount of transaction you have with the broker.

what are the fees for stocktrade.co.uk. Like have you been using them or just suggesting them.Does it offer irish and american sharse as well?

Again for firsttrade,could you outline some of the fees.Their prices seem fairly good but i was wondering what is the commission fee and yearly sub.Is it 7 yearly and 26.95 min commission?Btw does that only offer american shares or also irish and uk shares.

pirelli

Fol20 wrote: »

Can you explain options and spreadbet a bit more,i googled it and find it a bit hard to understand.I know there are terms such as put,write etc but i dont really understand it.What is spreadbet aswell.

Firstrade are one of the earliest online brokers in America and one of the cheapest.
http://www.firstrade.com/public/en_us/pricing/commissions/
(notice the prohibitive pennystock fee)

Options
A very good article:
http://www.investopedia.com/articles/optioninvestor/06/Options4Advantages.asp

FROM\: hotstockmarket.com http://www.hotstockmarket.com/

Options
By: Mr.W
Basics

* An option is a contract that gives the owner the right, but not the obligation, to buy or sell a stock at a set price by a set date.
* An option is a piece of paper that allows you if you own the contract to buy or sell a stock at a set price before the contract expires, or to buy or sell the contract at any time prior to expiration..
* ctrct=contract
* a Purchased Call option gives you the right to buy a stock a t a set price for a set period of time.
* A Purchased Put option gives you the right to SELL a stock at a certain price by a set date.
* Option carry the risk of total loss of your investment.
* Options have leverage. When you buy 1 contract, you control 100 shares of the stock at a fraction of the price

5 Ingredients to Option Pricing

* The current stock price.
* The strike price you are trading.
* The time till the option expires.
* The cost of the money.
* The stocks volatility.

Every Option has 2 Parts

* Intrinsic vale
o Value if the current value of the opt if it were to be exercised today.
* Time value
o Value if the amount you pay to exercise your contract within the next few months.
o Time Value(TV) is the additional amount the MM's add to the premium, it's like a car dealers mark up price.

Example
a. Intrinsic value + Time value = option price
b. Stock=$26
c. I want to buy the $25 calls
d. The intrinsic value = $1 (26-25)
e. If the option quote price of the $25 call is 2.50, then the time value is $1.50 (see F)
f. 2.50-1.00=1.50
g. If stock is $27, Intrinsic Value=$2.00
h. Option Quote - Intrinsic Value = Time Value

Theoretical Value
1. Is the fair value of an option.
2. It not only tells us if the stock is overvalued or undervalued, but it also tells us exactly what price we should be paying for an option.
3. This T-value is derived from the Black Scholes Calculator.
Example
a. Lets say we are looking at a 60.00 stock and the Tval is listed at .65.
b. Ask price for the strike price and the exp month is .70 for the Nov 60.00 call option.
c. If we pay .70 to buy the option and the Tval is .65 we will pay 7.6% more than we should.
d. There is a normal premium built into most options as the MM's will try to see how much more you are willing to pay.
e. As a general rule of thumb, make sure the ask price of an option is not trading more than 20% premium of the T-Val.
The full lesson
http://www.hotstockmarket.com/forums/showthread.php?t=54158&highlight=options

Spread betting
http://www.paddypowertrader.com/about-spread-betting.php

Bytheway

ETRADE seem to be very good also. I trade on a uk ETRADE account which deals with FTSE and AIM market.
Forget about Davys and Irish stockbrokers.

MrMatisse

Stocktrade offers Irish/uk shares ( Not sure about american)

If you open any self administered pension policy with standard life in dublin this is who you use which is how i came across them.

14 sterling per trade, custody fees vary according to the account.

Maybe www.tdwaterhouse.co.uk also?

In the process of opening an account there. Seems to be going ok. Cheaper than the above. You have to call them if you live outside the U.K though.

http://www.tdwaterhouse.co.uk/help/faq.cfm?faq=324

samson09

For spread betting info, there's some good introductory info on paddypowertrader.com and worldspreads.ie. No commission or fees (the fees are in the spread, you'll learn about this in the tutorial). This would probably be the best option for short term investing/trading.

For longer term buy and hold investing you could try buying the actual shares (National Irish bank have good rates) although with the way things are going you may end up losing everything unless you keep a close eye on the prices. Personally I like gold as a long term investment.

sternn

Is spread betting as easy to make money as people make it out to be?

strmin

sternn wrote: »

Is spread betting as easy to make money as people make it out to be?

Even easier to lose much more money.

Hanley

strmin wrote: »

Even easier to lose much more money.

The beauty of tight stops becomes apparent....

sternn

strmin wrote: »

Even easier to lose much more money.

Even if you put in stoppers, ie to avoid going below the amount you set?

Idu

sternn wrote: »

Is spread betting as easy to make money as people make it out to be?

people dont tend to brag about their losers

robmchl

Demo/paper trade until you are consistently profitable (3 months at very least) and then look at putting some real money on the line. That is not meant to be patronising in anyway but it genuinely is a waste of your hard earned money otherwise. I'm assuming (possibly incorrectly) that you are new to investment/trading as your asking about account opening. Spreadbet/CFD would be my advice for account size of a few hundred euro as it is leveraged and while you will pay more on the spread in many cases, your profit potential is increased and won't get eaten up in charges. Remember you are trading on margin however!

Whatever approach you take, fundamental,technical... know what you are doing and know your strategy inside out before you commit any capital and use stop losses. On the other hand if it's only a gamble you're after you can ignore all of the above Best of luck with it.

ODL
CMC
Worldspreads
IG Index

are some companies that offer spreadbtting/CFD's and more.

Rob

Daragh101

the irish banks must be the easiest spread bet.....

daveirl

This post has been deleted.

luckystrike23

-> this should prove helpful: Spread Betting FAQs