As you’ve probably noticed while reading the content here on this page, we’re referring to “stocks” as well as “shares”. So then, what’s the difference between stocks and shares?

To start with, for all intents and purposes, stocks and shares refer to basically the same thing. There is a mild difference though, and we’ll go into that now. The term “stocks” is the most common term and it’s used to describe a slice of ownership of one or more companies. Let’s look at an example. Jaymes Payten owns stocks in Apple and in Amazon. Shares, on the other hand, have a more specific meaning as they often refer to the ownership of a particular company. For instance, Jaymes Payten owns shares in Apple. See the difference? If someone says he or she “owns shares”, the question that you should ask that person is “in which company?” So, going back to our example, Jaymes Payten might ask his broker to buy him 100 shares of Apple Inc. But if he asked his stockbroker to invest in “100 stocks”, Jaymes would be asking his broker to invest in a host of different companies.

People like you invest and buy stocks in companies for a multitude of reasons. You might want to see your investment rise, which we also call “capital appreciation”. To see your investment in the shares you buy rise, you’re going to have to buy the shares at certain price, e.g. $100 per share, and then sell them when the price of the company rises. When that happens, the share price rises too, so if you sell the shares at $150, you’ve made $50 per share. Another key reason for buying shares is the potential income you can gain from dividends. Dividends are paid out to the owners of the shares if the company is doing really well.

We get asked this question quite a lot and we always tell the person asking it to invest in a company they’re familiar with. If you’re interested in investing in a company that you’re not too familiar with, we definitely advise you to carry out research on the company. You can do this by reviewing the company’s financial statements, taking a look at the latest news coming out for the company, as well as reviewing the analysis reports created by top market researchers and analysts. By doing this, you’ll be in a much better position to know if the company you want to invest in has the potential to grow.

If you’re ready to make an investment in the stock market and you’ve not yet opened a trading account with a respected and reputable broker, go ahead and check out our best stockbrokers in 2020 list. We’ve made it super easy for you to compare our different providers and choose which brokerage offers you the investment features you’re looking for. One key bit of advice from all of us here is that it’s best to choose a brokerage which offers you a variety of instruments. Why? Because when it comes to investing, diversification is key. Never put all your eggs into one “stocks and shares” basket, but instead, look to the future and invest in other assets. Some of the brokers in our list offer multiple assets and instruments from you to choose from. It’s down to you, but we definitely advise you to look at diversifying your investment portfolio in future.

The simple answer to you making a safe investment in an online brokerage is both yes and no. We know this might not be the answer you wanted to hear, but one of the pillars here at OnlineSharesBrokers.com is transparency. We’re always going to be fully transparent with you and all our readers.

So, when we say that it is both safe and not safe to make a deposit with an online brokerage, what we mean is that it’s safe if you’re making a deposit with a regulated broker that’s reputable and doesn’t have a reputation. We can’t stress highly enough just how important it is for you to select a brokerage that’s regulated or authorized by leading regulatory bodies such as the FCA (Financial Conduct Authority of the United Kingdom, ASIC (Australian Securities and Investments Commission of Australia), and CySEC (Cyprus Securities and Exchange Commission). There are other regulators too, but these three are the main ones you should be looking at. Regulated online brokers are a lot more reliable than non-regulated brokerages, and one of the key reasons is that regulated brokers must maintain segregated accounts. Segregated accounts are the bank accounts regulated brokers store their clients’ funds in. These accounts are separate from the brokers operational bank accounts. If the broker goes under, your funds are safe.

The majority of online brokerages accept a minimum investment of between $/€/£200 to $/€/£250, but when it comes to making an investment, you’re not going to be huge returns on a $/€/£250 outlay. By all means, we advise you to get started with the minimum amount if this is what makes you comfortable, especially if the brokerage you’re making the deposit with is new to you. After spending a few months with the broker and when you feel comfortable, we do advise that you invest more. The more equity you have, the more possibilities you’re going to have.

If you’ve got any questions about anything you’ve read here, feel free to get in touch with us via our Contact page [ADD LINK]. We receive hundreds of questions from our readers each week and we’d be more than happy to answer any questions you have about the brokerages we list on our website. If you have any online trading educational questions, we can help you with your questions too.