There are several ways to invest in shares issued by listed companies. For example, you can buy shares with the aim of selling them in the short term or in the long term after a few years. There is a big difference in the field of equity investment between traditional trading and trading online with CFDs.
In this article, we will see how you can invest in shares with Plus500, a broker well known internationally, which allows you to trade on the stock exchange from home, with a simple connection to the Internet, in a totally transparent and secure way.
Trading on which shares with Plus500?
Plus500 is one of the brokers with the widest choice of stocks in the world. It offers more than 2000 shares, including all the most important ones, listed on the main stock markets in the world. In particular, it offers over 1000 shares listed on Wall Street (New York) and many of the other stock exchange indices, including the Italian FTSE MIB in Milan, in addition to the indices of Paris, London, Frankfurt, Madrid, Singapore, Tokyo and so on.
For example, there is the possibility of trading on some stocks that are missing on many platforms, such as Ferrari shares.
To see a wider list, just go to the section dedicated to the shares of the site of Plus500, where you can see the more than 2000 securities available. Lately it is legal to buy and sell shares of Cannabis in many countries.
How to trade stocks on Plus500?
Trading stocks on Plus500 is very simple. The Plus500 platform is very well organized, with clear and clean graphics. First time traders will have no difficulty in finding the stock on which they want to trade.
In fact, all you need to do to find the stock you want to trade on Plus500 is:
- Enter the screen “Trade”
- Scroll down and find “Shares” category
- Select the possible sub-category (for example “USA” or the initial if we want to trade on a security listed on the American stock exchange)
Once the sub-category has been selected, the titles belonging to it are displayed in the central part of the screen
At this point, the trader decides whether to buy or sell a stock on Plus500, or to play on the stock exchange on this platform.
What does it mean to buy a share on Plus500?
When you buy an Amazon CFD stock on Plus500, you trade on the value of the Amazon stock listed on the stock exchange. The CFD replicates the trend of the stock, so if the trader opened a Buy position, i.e. made a Purchase transaction on Amazon, the trader will make profits in proportion to the increases in the Amazon stock.
What does it mean to sell shares on Plus500?
Selling a share on Plus500 means opening a short position by buying a “Sell” type CFD. As explained above, Plus500 is a CFD broker, so the available stocks are equity CFDs.
When you sell an Amazon CFD stock on Plus500, therefore, you trade on the value of the Amazon stock listed on the stock exchange. The CFD replicates the trend of the stock, so if the trader has opened a Sell position, i.e. has made a Sell at Amazon, the trader will make profits in proportion to the decrease in the value of the Amazon stock.
How to finalize a trading of securities on Plus500?
When you have made a market decision, i.e. whether to open a position to buy or sell shares on Plus500, you can move on to finalisation i.e. the phase in which you set all the details that are needed to actually open the position.
To open the position, we have seen that it is necessary to click on the button that appears in the window of the finalization of the order.
When you want to close the position, because you are satisfied with the result obtained or you prefer not to keep it open (because you have lost it, because you are not convinced, etc.), you must click on the “Close position” button.
It is important to note that to close the position you simply need to “Close” it. (Do not open a position Sell with the intention of closing a position Buy).
Below, we see the window relating to the details of opening a position to buy shares on Plus500.
As you can see, there are several items to pay particular attention to:
- Amount: represents the number of Shares you wish to trade on (0.1 in the example)
- After leverage: CFDs are leveraged instruments and therefore allow you to trade on a higher number of shares than the investment required.
- Value: the value of your investment (selected shares amount in the first point x actual value)
- Required Margin: is the actual amount of investment based on the leverage applied, ie how much the trader will actually have to invest to open the position (you can see that with CFDs you can invest a lot less than with a traditional investment, go to the CFD lesson about margins for more details).
- Close at profit: it’s the take profit order. By checking this box, you can set a level of profit taking, at which point the position closes automatically.
- Close at Loss: By checking this box, you can set a maximum loss level at which the position is automatically closed.
- Guaranteed Close: This option is not available for all instruments, and is used to close the position in case of very strong price changes. Requires an additional spread.
- Buy/Sell: with this button you can proceed to the execution of the order, confirming all the previous choices.
For a more complete understanding, check out our definitive guide to CFD trading.
You can also check our complete tutorial on Plus500.