Trading US stocks from Japan is different, and for some, it can be daunting. It is why this guide was created to give investors of all levels the knowledge to become a trader of US stocks.
First, we’ll explore what you’ll need to do before you start trading, then how to get started, and finally, look at some basic strategies that can help you on your way.
Before You Start: What Do I Need To Know?
Before you start looking into buying and selling stock in the United States, there are things that you need to know first so as not to lose any money or, worse still, risk breaching laws governing stock trading. The two most important aspects are account requirements and fees.
Before you start trading US stocks, you’ll need to open an account with a broker. It is not the same as opening a bank account; this is like choosing your shop front to buy and sell in. Each brokerage firm will have different requirements to comply with legal obligations, so make sure you consider these before looking at any brokers.
Some of the main ones are:
- The money that you need to deposit into your account (known as Minimum Initial Deposit)
- Whether or not they accept electronic debits from your bank, credit card, or debit card
Some brokers will also offer incentives for opening an account with them, such as free trades or discounted trades if set up by a specific date.
Fees are necessary when choosing a broker because they will affect your portfolio’s overall performance. Several different fees exist, but the most common ones you’ll come across are:
The Brokerage Fee is the fee that the brokerage firm charges for buying or selling stock in their market. It can be either fixed or a percentage of your order value. This fee varies by which company you use, so it pays to shop around before committing to one particular brokerage firm.
It’s also worth remembering that some offers have hidden benefits, such as lower rates during low-volume trading times or free trades if set up with a direct deposit from your bank account.
Trading Fees are a newer type of fee introduced by some brokers to make up for the loss in brokerage fees due to low-volume trading times. It is charged during specific hours when there is not enough activity on the market to warrant average commission rates.
Some brokers charge the account management fee for regular portfolio maintenance such as account monitoring or transactions. As with brokerage fees, this kind of fee varies between companies, so it’s worth doing your research before committing to one company over another.
US securities fees
US Securities Fees are charges made directly from US stock markets themselves and are independent of which broker you use. They’re designed to reduce volatility by discouraging huge trades placed by institutional investors but still apply even if you place a smaller order. Fees vary depending on the particular company that you’re buying or selling shares with but are always extremely small (less than $10 per trade).
Getting Started With Trading US Stocks
Now that you know what’s expected of you, it’s time to start looking for a broker and getting ready to place your first trade. Some brokers will offer tutorials on how to use their sites, but there are plenty of other resources on the internet that can help you get going.
Another thing to remember if this is your first time trading US stocks is not to panic when there are big swings in the market, as it will take some trial and error before you get used to reading these movements.
Now that you understand how much money you need, what types of fees exist, and what they entitle you to, it’s time to find a broker! Each brokerage company has different requirements for opening an account, so make sure you read up on any special offers or incentives each might offer before deciding whose website to sign up through.
Check out Saxo Bank US for more info on trading.