Your first transaction in the foreign stock market

Listen to the wise advice of experienced investors.

First, the choice of investment strategy will depend on your financial capabilities. If you have accumulated several hundred thousand dollars, it is better to entrust the management of money in Switzerland, the Baltic or the Austrian bankers. They pick up the option of investing and diversify risks better than any newcomer.

And if your capital does not exceed $ 100 thousand (or less), then go to foreign markets will have their own. But for this you need to learn foreign market shares and use the services of online brokers.


A small beginning of the big cases

Since the work on-line brokers, through which you can perform transactions on the leading stock sites can be accessed by visiting the sites www.ameritrade.com, www.etrade.com, www.shwabs.com.

Start with the need of opening an account with one (you can have several), an online broker. And for that should go to his site and to print a form contract for the provision of services. Then you fill the contract, sign it and send by mail the broker. Usually you want a paper copy of the contract with the handwritten signature of the investor.

With a contract you must send the form and the so-called W8ben, telling that the investor is not a U.S. citizen and does not reside temporarily in the U.S. territory. This form is very useful - it saves you from tax in the United States.

Then you should list a certain amount of money in your account. Typically, the broker, as a rule, asked to make a check, but since this type of calculations we have not distributed, it will be possible to transfer the money later, after opening an account.

You will learn about opening it, if you periodically (eg once a day) will go to the site of the selected broker to its password. And please note that a letter of agreement will lead to the broker about two weeks.

To activate the account it should not be less than $ 500. However, operating such a sum, you are unlikely to get good results. Bonus points if your account will be $ 3-5 thousand, or even better - $ 10 thousand if you're a beginner, then more investment is not recommended.


The money - to the

So, you see that the account is opened. This will be visible on the welcome: you turn on the name you specified in the contract with a broker. Then begins the fun part - through you, but there is no money in it. What should I do?

There are several ways to send money abroad. The most simple and inexpensive: find among your friends who are familiar with the foreign economic activity (has business with foreign partners). Ask someone to list his foreign accounts (most likely offshore) to your account with an American broker an amount, for example, $ 7 thousand, of course, that the money (cash only) you must return your facilitator in Ukraine.

It is important that the money in your account does not come with the territory of Ukraine, as with any foreign or offshore companies. Indeed, in this case, the sender is impossible to attract criminal liability. This scheme is used by many brokers. To obtain a license in NBU investing abroad use only one.


The difficulty of choosing

So, your money to a broker there. What's next? At the U.S. stock markets traded more than 20 thousand of the shares cost from $ 0,001 to $ 110 thousand each. And each campaign stands by its symbol (ticker). For example, Boeing stock is traded under the symbol BA; Intel Corp. - INTC; General Motors - GM; Avon products - AVP, and so on. In all this, you need to thoroughly understand.

To do this, go to www.yahoo.com, follow the link under the shares (stocks) and go to the stock screening (screening - selection of stocks on the specified parameters). Ask any setting, for example, the size of the capitalization of the company at least $ 1 billion search engine will give you a long list of stocks that meet the given parameters, the names of companies and their stock symbols. Choose Meet companies, their financial condition, capitalization, staff, etc.

All this can be found at www.yahoo.com, to be exact - at http://finance.yahoo.com, as well as the site chosen broker. The above data are provided to customers on a mandatory basis. You can also find the graphics market price stock that can be built in any time scale.


You - shareholder

Finally, the action you selected. Let it be shares of Goodyear tire (GT) - the largest manufacturer of tires in the United States. Go to the homepage of orders your broker, fill out a warrant to purchase and then press ENTER. You will see the order in slightly modified form, and ask the broker to confirm the order. Press ENTER again. Within a few seconds, you become a shareholder in the company Goodyear tire!

After entry in the register of shareholders, you get all the rights of co-owner companies. You by e-mail invitations will even come to the annual meeting of shareholders. Letters coming from abroad, especially from the broker or the company may intercept the concerned authorities, so it is desirable to specify in the contract for real, but not his, but someone else's (eg, a friend who lives abroad).

Naturally, the broker for the execution of the order will commission (within the $ 15-20). And no matter how many shares you purchased - 1 or 1000. Fees are the same. Of course, cheaper to buy more shares. So, if bought 10 shares of GT for $ 20, you pay $ 200 per share plus $ 20 - fees for the purchase, plus $ 20 left to pay on the sale. Total is $ 240. That is, to withdraw from the deal without a loss, will sell the shares of GT is not below $ 24 apiece - a 20% higher than the purchase! So you proderzhites shortly. Therefore, the shares you need to buy 400-500 pieces, then the transaction will be more than justified.

Sale of shares bought - true art. Assume that your account was correct and the share price rising. When to sell? The first option - after the price rises to 10-15%. Second - keep until the graph of prices of shares do not see obvious signs of trend turn.

Lack of first option is that you can sell the stock too early and lost profits. The lack of a second - a large portion of the profits you could lose, waiting for signals on the spread pattern.

Of course, there are other options to determine the optimal time of sale. All of them are described in the literature on technical analysis.


Profit and risk

You understand that you can earn a lot of - there is no limit. It needs a sober calculation, and a little luck. Working with the shares of small companies, you will, of course, much to risk, but returns may be high. Such companies can provide gains of up to 300% and more than a few days.

See graphs of growth stocks, you can visit the site www.bigcharts.com. There you'll find many interesting graphs of shares, which showed the marvels of growth in 200%, 400% and 1000% for a few days. It is important only to predict a price rise, to find a company before its shares scrambled raskupat millions of investors, and prices began to take off.

If you are conservative and invest money only in the «blue chips», then your earnings may be lower. On average - from 5-25% for the year, if not wrong with the choice of object attachments. But in both cases, losses are possible. Indeed, to predict share price is quite difficult, especially our inexperienced Ukrainian investors.


How to get to?

Finally you receive a desired income. Now the question arises: how to collect their money from the account of the broker? The path is almost the same as when you send money, just the opposite. Transfer of proceeds from his accounts with the broker to the account of a foreign company of his friend's (or the payment properties abroad that he would provide). Then the mediator in Ukraine pays cash (minus a premium for services). But in this case, all based on trust, which is very risky.

Calculate your costs when withdrawing money. About $ 20-25 will remove the broker for the transfer of money and even 1-2% of the amount you must pay the mediator-businessman. So, with income of $ 5000 in cash receive a profit:

• 5000 - 25 = 4975;

• 4975 - 1.5% = 4900.

That is, the loss of no more than $ 100.

But to receive the income is very, very difficult. Do not believe those who say it's easy. Achieving good results requires great analytical work.