Getting started in the stock market is a simple process.
1. Choose your STOCKBROKER.
At present, there are more than a hundred stockbrokerage companies to choose from.
When you choose a stockbroker, you need to consider the type of service you will require and who will best suit your needs. You should remember that your stockbroker is your financial agent that will help you make your invested money grow. Stockbrokers are also classified as traditional or online based on the services that they offer.
Traditional brokers are those who assign a licensed salesman to handle your account and take your orders through phone calls, SMS or messaging apps. Online brokers, on the other hand, are those whose main interface with their customer is through their online trading platform.
The full listing of stockbrokers is available in the PSE website.
2. Open a TRADING ACCOUNT with your chosen stockbroker.
The next step is to formally open a trading account. Similar to the process in opening a bank account, representatives of the chosen stockbrokerage company will require you to fill out a Customer Account Information Form or CAIF. Accomplish this along with the other requirements such as:
- Two (2) valid IDs;
- Specimen signature cards, and;
- Proof of billing.
Depending on your stockbroker, you may be also asked to provide additional pertinent documents and an initial cash deposit in order to begin investing
in stocks.
3. Discuss with your stockbroker the stocks you wish to BUY or SELL.
After opening a trading account, you can now start discussing with your stockbroker the stocks you wish to buy (or sell).
4. Give ORDERS to the stockbrokers.
Placing an order to buy or sell a stock can be done by making a telephone call or sending an SMS to your stockbroker. Orders can also be placed directly online via online trading platform.
5. Get the CONFIRMATION RECEIPT.
Once your order has been carried out, your stockbroker will give you a confirmation invoice showing the details of your transaction.
6. Deliver/Pay before SETTLEMENT DEADLINE.
The delivery or payment should be made before the deadline on settlement date. For traditional stockbrokers, the buyer must pay for the cost of the transaction while the seller must deliver the securities to the stockbroker within two (2) trading days after the trade was done but not later than the settlement deadline. For online stockbrokers, settlement of all transactions is done on the transaction date.
7. Receive PROCEEDS/SHARES.
8. MONITOR and TRACK your investments.
