This is a great article and visual for anyone who is hesitant, curious, confused, or heck really excited to make that first real money stock trade. This article will explain how to make a stock trade online, start to finish.
The Order Page
When you place a stock trade online, you fill out what is called a “trade ticket” for that order. It is a simple fill in the blank, check the boxes form, and when you finish you simply click “review order” and then place the trade.
To your left is a screen shot of that order form that I took just before starting this post. Click the image to see it large, and click it again to zoom.
This image is from TD Ameritrade where I have several accounts. They aren’t paying me for using them as the example, sadly, but you can probably find a link to their site or one of their competitors on this page somewhere.
What to Fill In
Before you place the stock trade online, there are two ways to fill out the ticket: the fast and easy way, or the fast and detailed way. Let’s look at both (refer back to the image when reading below):
Fast and Easy Way - We need to fill in if we first want to “buy” or “sell” the stock, followed by the quantity or number of shares we want to purchase, and the symbol of the stock. So let’s say we wanted to buy 100 shares of Google (GOOG), then we would check the “buy” circle, type in 100 next to “quantity” and “GOOG” next to symbol. So far so good? Next you can see that below the buy sell is the “Order Type”. To make things easy, we will want to change this to “market” which means we want to buy the stock IMMEDIATELY. I will explain the order types in a later stock education post. From there we can leave the settings unchanged (the “expiration”, “special instructions”, and “routing” fields) and click “review order”! The review order page (image further down) summarizes what we filled in and if we have enough cash to make the trade.
Fast and Detailed Way - The only difference with going detailed is that you fill in the minor details of the order. The most common is the “order type” which depending on if it is a buy or a sell it can change. This will make a great future investor education post! The other options at the bottom are moreso used when you don’t use a market order (which is the immediate fill order, or “Place this NOW”). Expiration is important if let’s say you only want to buy the stock at xxx price, but only if it hits that price today, or this week, or this month, whatever. As well you can make the order live in after hours trading. Special instructions are such like “fill or kill” and the like, again not worth explaining here. Lastly the routing is another just keep default, but what it allows you to do is to choose where you want your order sent. With “auto” set the order is sent wherever the best price is available at the time of the trade (which is actually a new SEC law less than a year old)
Placing the Order
Summarizing from above, but basically once you fill out the trade ticket, you simply click “review order” which summarizes your order and how much it estimated it will cost you to fill (see visual of 100 shares of google), and then you place the actual trade.
The whole process start to finish can take literally seconds if you are quick, and actually there are speed forms for the ultra speed where you can simple type the shares, ticker, etc. on one line and just hit enter, just make sure you don’t type in an extra 0 next to the amount.