This page will guide you the process of trading stocks on the Simulator.
If you'd like to learn more about what stocks are, check out our
stocks basics tutorial.
1. First, you must know the stock symbol (sometimes called the ticker symbol)
for the stock you'd like to trade. These symbols are used to identify the stock
of a corporation. They range from one to five letters and are usually similar
to the company's name. For example, the ticker symbol of Microsoft is "MSFT"
and the ticker symbol of General Electric is "GE". We provide a Symbol Lookup
tool where you can enter a company's name and get the symbol.
2. After you know the ticker symbol, go to the order entry screen by clicking
on "trade stocks" when on the portfolio page. You should get a page that looks
like the following:
Transaction Types
-
Buy and sell is fairly
self-explanatory.
-
"Sell short" and "buy
to cover" are more advanced trading techniques. We're not going to get into it
here, but short selling is a way to profit when a stock goes down in value. For
more info, go to our short selling help file (coming soon).
Order Types
-
A market order is the
most common order type. This simply means that you'll buy at whatever the price
the stock is currently trading at. The advantage is that it's easier and your
order is guaranteed to be filled. For most investors a market order is all they
need. The only problem with market orders is that in a volatile market the
price an order is filled at can deviate significantly from the last-traded
price.
-
A limit order sets the
maximum or minimum price at which you are willing to buy or sell. For example,
a buy limit order at $10 means that you will pay no more than $10 for the
stock. Limit orders allow you to be more precise but this also means that you
aren't guaranteed to get your order filled.
-
A stop order trades a
stock when the price passes through a particular point. The most common usage
of this is a "stop-loss
order." For example, if you own a stock that is currently at $20 you
could set a stop-loss order at $15 in order to limit your loss to around $5. If
the stock fell below $15 the stop order is activated and the stock would be
sold at market price.
More info on order types
can by found in our article entitled:"the
basics of order entry."
Symbol, Shares, and Term
The rest of the columns on the order entry screen are easy to understand:
-
We've talked about what
stocks symbols are, notice how in this example we've entered the ticker for
Microsoft.
-
The number of shares
must be a number greater than 0.
-
The term can be either
"day order" or "good till cancelled (GTC)". This is only valid for limit and
stop orders as a market order is always filled right away. Day orders are valid
until the end of the current trading day while GTC orders are valid until you
cancel them.
-
The box for
"confirmation email" is optional if you want to receive an email with details
of the order.
3. After you are happy
with your order press "preview order" and you'll be taken to a screen that
looks like the following:
This screen confirms
all the details of your order including the actual price and commission. If
everything looks OK, hit "submit order."
Assuming there are no problems with the trade you'll be able to see the stock
in your portfolio..
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