When an investor buys shares in a company he is actually investing in the company’s capital and can get the same proportion in profits.
For the company, the actions make more money go into cash and become part of its investments used in its activities.
The shares of the companies are traded on the Stock Exchange. To Invest you will need to buy the desired amount through a broker, and the entire process can be done over the internet.
How to start buying stocks: step by step
1. Find a broker and open an account
Through a brokerage account there is direct access to the purchase and sale of shares listed on B3, the São Paulo Stock Exchange.
On the B3 website, all authorized brokers are selected. Research each one and know the brokerage or administrative fees that may be charged.
2. Transfer your money to the brokerage account
To start buying shares, transfer the required amount from a bank account to the broker’s account.
3. Analyze which companies you want to buy shares from
With the money in mind – and before you start investing for real – you will need to know the companies you want to buy shares from. This is because you will own the parts you buy from each company.
In this process, get to know in depth the activities that each company carries out. Look for the accounting reports that are made available online and, finally, analyze how the stock price has behaved.
Through the broker’s online account, it is possible to use the Home Broker. This system is used to analyze quotation information and issue purchase or sale orders.
4. Start building your equity investment portfolio
The Home Broker should show the different prices that the shares of each company are being traded at the moment. For each amount, it is possible to decide the number of shares that you want to issue the purchase order.
When you buy shares in different companies, you will build a portfolio of investments in shares. Then you will be able to receive part of the profits from each of them, as well as sell and buy new shares.
It is worth remembering that investment in shares corresponds to variable income. The value that stocks can achieve in the future and the profit that each company achieves are unpredictable, and can generate many gains and losses for those who invest.
Therefore, diversify the risk by building a portfolio with shares of different companies.
If in doubt, seek help from the administrators of the broker that has an account and always continue to learn the best ways to invest in stocks.
How to reduce risks when investing in the stock market
Becoming a shareholder in a company can bring risks to the capital invested, as even the largest companies can break down at an unexpected time.
To avoid a good part of these risks, a fundamental rule is diversification, that is, buy shares in different companies and set up an investment portfolio.
Some stocks will have higher yields and others lower. In the end, what you can get is the average of these earnings, due to the diversification.
When starting to invest, try to alternate part of the capital in variable income (shares) and another part in fixed income, such as Treasury bonds, for example. The entire process can be done and accompanied by the Home Broker offered by the broker.
Costs for investing in stocks
Each brokerage firm charges its brokerage fee for each transaction carried out, in purchase or sale, which may be a fixed amount or a variable fee.
On the Stock Exchange side (B3), there are negotiation and settlement fees on the value of the transaction. There is also a monthly custody fee for custody of shares.
How the sale of shares on the stock market works
In the stock market, different types of companies participate, which have different types of businesses, in search of more capital.
Each share is a very small division of the company’s capital. The prices of their quotations vary according to supply and demand on the stock exchange and some can be purchased even with little money, such as R $ 5 or R $ 10, for example.
To enter the stock exchange, a company must launch its shares for the first time, to the first buyers, through the primary market. This process is known as an IPO (initial public offering).
In the secondary market, the shares start to be traded from the second time. This part of the Exchange exists, mainly, so that there is greater liquidity between the shares and sellers can resell their shares whenever they want.
Investors who acquire shares in a company will periodically receive dividends, which are the portions of their profits. The money paid in dividends goes directly to the account opened with the broker.
At least 25% of profits must be distributed as dividends to shareholders and in some companies the proportion can be much higher. This information can be consulted with the broker itself.
Another factor to consider is that there are two types of actions:
- Ordinary, known as ON
- Preferred, known as PN
Anyone who acquires ON shares gains the right to vote at shareholders’ meetings. Who owns the PN has preference in receiving dividends, in addition to being more easily traded on the Stock Exchange.
Some investors choose to make a profit from stocks by buying and selling, exploiting price differences on the same day, buying at the lowest value and selling at the highest value. This process is known as Day Trade.