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Stock trading: compare fees

Stock trading can bring high returns

In times of low yields and interest rates, stock trading also appears to be particularly attractive for beginners. Especially people who want to hold a share for a longer period benefit from this type of investment. That is why shares are also suitable as private pension provision. Even investors with little start-up capital can benefit from trading stocks. It is worth comparing individual stocks and the portfolios offered.

Who is stock trading for?

Basically, a distinction can be made between short-term speculation and long-term investment. To speculate, you need capital that you don't necessarily need. The less wealthy also benefit from long-term investments. However, the money should be planned for a period of at least 10-15 years. For example, if you want to save on buying a house, you should keep your hands off stocks. In this way, older savers can invest non-retirement assets in stocks for their descendants. To be on the safe side, interested investors can create a savings plan.

This is where stock trading takes place

Stock trading takes place on stock exchanges and over-the-counter trading venues. An exchange is a market organized by rules. There are seven stock exchanges in Germany, the one in Frankfurt am Main being the largest and best known of them. In addition to such real places, there are also computer exchanges. All stock trading there works digitally; it is handled by a computer program. OTC trading, also known as OTC trading, is mostly done electronically today. Market participants handle it directly with one another.

The DAX provides an overview of the German stock market

DAX - the German share index - is the most important index in this country. It summarizes the price development of the 30 most important German stock corporations such as Deutsche Bank and BMW. The DAX level is measured with points. It offers a good general overview of the German stock market. Like a barometer, the DAX shows the mood on the stock market.

Investors can buy the shares of every single company listed in the DAX. Alternatively, you can invest in an index fund that tracks the DAX.

Brokers and Traders: This is how private investors participate in stock trading

Stock trading is now a straightforward process that is not that different from online banking. The customer forwards his security order to the financial service provider via an online trading platform. These so-called brokers handle stock trading - also known as brokerage - on behalf of their customers. Trading directly on the stock exchange is impossible without a broker, because private individuals have no access here. That is why the customer opens a stock portfolio with the broker. This step turns the customer into a trader, i.e. a securities dealer.

This must be taken into account when opening a depot

A stock custody account is nothing more than an account for securities. As with online banking, orders are authorized using PINs and TANs. The depot management works without any problems and special technical knowledge is not required. Before opening, customers should compare the applicable fees. Many brokers do not require a minimum deposit of capital when opening a custody account. In some cases, however, they charge additional fees if the deposit is less than € 5,000 or € 10,000. With the deposit, the customer also has access to foreign exchange trading. With so-called CFDs (Contracts for Difference) he can set rising and falling rates of currencies.

These costs arise when trading stocks

Banks and other brokers offer the opening and management of custody accounts free of charge. With online trading, the trading fees are manageable. However, they vary greatly depending on the provider. Every broker charges order fees, also known as transaction costs. This fee is due for every order, i.e. every purchase or sale initiated. It can be fixed or is calculated as a percentage based on the order total. In addition, investors usually expect exchange fees. When making a comparison, investors should consider their trading intentions. Anyone who buys long-term and leaves shares in the depot for a long time should pay attention to inexpensive depot management. Those who buy and sell in short intervals place more value on low order fees or package offers such as flat rates.

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