Minimum to Investing in Big Companies within Stocks?
★ SUMMARY ★
People always ask me: Is there a minimum to investing in big companies within the stock market?
The short answer is no, there isn’t really minimums when it comes to investing in stocks. You can invest however much you want to invest, whether that’s one dollar, ten thousand dollars or ten million dollars.
However, there might be minimums when it comes to the broker that actually executes your trade. For example, “Interactive Brokers” has a minimum of $10,000 for opening up an account and trading with them. There are also minimum monthly trades that you have to do in monthly activity fees, and if you don’t hit those minimums, then they will charge you.
The reason some brokers have these minimum requirements is because they need you to be an active trader. That’s how they make money and keep their business running. However, there are other brokers that don’t have account minimums at all, such as “TradeKing”.
But when it comes to the stock market itself, there are really no minimums. You can buy 1 share, 10 shares or 100 shares. Of course, it’s much better if you trade in round numbers, as it makes it easier to do calculations, projections and so forth.
The one problem you can run into when you have a very small account is growth limitations, since it can be very difficult and take a long time to grow a small account.
For example, if you’re investing $2000 and you earn $300 a month, even though that might not seem like a lot of money, you’re making a 15% return, which is phenomenal when it comes to the stock market.
Whereas there might be another person with a $30,000,000 account, and even though they only have a 2% return, they’re still making a lot more money ($600,000) just because their account is much bigger.
Posted at: http://tradersfly.com/2017/04/minimum-investing-big-companies/
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