Investment Software

If you want to try your hand at online investing, make sure you explore all the options and consider the investment software programs that are part of the package.

Online brokers allow you to buy and sell stocks online. The online software that you get to utilize this service largely takes the place of a human broker. You use real money, except for some software that allows you to “test” your results. The investment software allows you to track, screen, and trade stocks, and then you request your trades online and get verification of the sell or buy order. Some online brokerages have the option where you can talk to live brokers and do broker-assisted trades as part of their service.

Online investing isn’t just for buying and selling stocks, although that seems to be the most popular online use for investing. Some investment firms allow their customers to purchase bonds, futures, mutual funds and options. These investing practices are considered to be more advanced forms making investments and should be approached with caution.

I’ve explored some of the options for investing online and here’s what I’ve found. They are listed in no particular order and without specific recommendation.

TD Ameritrade – This online brokerage firm has been providing services since 1975. The minimum to fund an account is $1000 for IRA’s and $2000 for non-IRA. There are sometimes promotional offers available. The cost to buy/sell stock is $9.95 per online trade. There is a fee schedule for other options that include getting a stock certificate, fees for subscriptions to some of the online tools, and more. TD Ameritrade offers online investment software tools. Some are provided at no fee and some have a subscription cost. These tools include Command Center 2.0, which allows you the ability to research stock and options trading. You can enter orders and view status. Other software tools offered include Pattern Matcher, QuoteScope, Options 360, StrategyDesk, and more.

Website: http://www.tdameritrade.com/welcome1.html

Scotttrade – This online brokerage firm has been in business for over 25 years. The minimum to fund an account is $500, or $2000 for option accounts. The fee for online stock trades is $7.00. The trading website offers research and intuitive tools at no charge. There is an advanced trading platform available for larger accounts, software that offers streaming quotes, and options software. There is also software that allows access from a mobile device.

Website: http://www.scottrade.com

E*Trade – Also in business for over 25 years, this company has a fund minimum of $1000. The fees for an online trade start at $12.99 per sell or buy order and decreases based on assets or volume of trades. The software available allows website trading, has screening options and also appears to have some educational options.

Website: https://us.etrade.com/e/t/home

Wall Street Survivor – And if you aren’t ready to deposit money. Try the “game.” This free online game will teach you how to use the software, how to read the stock prices and help you learn the lingo. Since 1990, the company that made this game has provided the top Business Schools in the United States with Stock Market simulations. These simulators have been used to teach business students the fundamentals of trading stocks, bonds, mutual funds, futures, currencies and options. Now you can try. Utilize this free download to learn how to make stock trades. This game is the closest thing to a real brokerage account, without taking the risk of losing money before you know what you are doing. Learn while you are interacting. The game offers a “virtual” money account so you can track how you’ve done. You execute fantasy trades in real time, with real information. The financial data feed is the same one used by brokers world-wide. The games Research Center includes programs that allow you to personalize data and charts on the stock market. It also comes with a calendar to track your earnings and a stock screener. There are additional tools that can help you expand your stock trading knowledge and learn to make informed decisions.

Website: https://www.wallstreetsurvivor.com/home.aspx#1

Summary

One thing I’ve learned since I’ve started researching investment software is that the more I know, the more I need to know. My husband and I want to start small and see if we can’t make informed choices and control at least a small piece of our own destiny. If we already have researched the stock we want to buy, why would we just turn that over to someone else? We’ve always been gamblers, and we’ve always known our limits. I believe those are two very important qualities if you plan on utilizing investment software to actually trade online.

The third important quality is knowledge. Do the research, ask the questions and compare the options. Then start small, or start with virtual money in the game and work up to real money in an online brokerage account. Good luck!

To make an educated decision on the best investment software program to use you have to know the terminology and understand the language for both the investment environment and the software niche.

This is a new world for me. As I’m reading up on the options for investment software I feel my eyes cross and my brow furrow. It’s a foreign language and I need a tutorial just on what seems to be the basic lingo. You need to understand not only the software terms like autocomplete, but also the investment language that is full of acronyms, like Forex.

If you don’t have a solid grasp of the language you are more likely to make mistakes. And this is one place where mistakes can be costly. My suggestion is to keep a little notebook that you can fill with terms and definitions. Mark a letter of the alphabet at the top every few pages and keep this beside you as you are working on your investments. When you come across a word or acronym you don’t know, write it in the book, Google the definition and write a version that you’ll remember in your notebook.

This is just the beginning. As you progress there are actually dictionaries you can download with stock market and accounting terminology. These dictionaries cover an extensive vocabulary of a wide range of investment topics and some come with translation abilities in English, German, French, Italian, Russian, and Spanish.

But to start, looking up the word you don’t know, writing it down and referring to it once and awhile are all teaching tools that will help you remember this new language. This is your vocabulary sheet to the investment world. I’ve got a few options to get you started. In no particular order:

Acronym – An acronym is a word made out of initials or parts of several words. For instance FOREX, or Forex, is Foreign Exchange.

NASDAQ – The NASDAQ Stock Market or just, NASDAQ, is an American stock exchange. This acronym originally stood for National Association of Securities Dealers Automated Quotations. Today this “word” is used to describe the ticker symbol of stocks that are listed on this particular exchange. For instance, NASDAQ:COKE means that COKE is what you will use to look up the price per share for Coca cola stock on the NASDAQ market.

OTC – Is an acronym for Over The Counter. Traditionally this term was used to describe securities transactions that are made via telephone and computer rather than on the floor of an exchange. With investment software and online trading, OTC is a specific designation that is usually handled differently from NASDAQ stocks. You may or may not be able to follow and track OTC traded securities. If this is important to you, verify what you can do. If this is online trading software, you may or may not be able to buy or sell OTC securities, so again, verify the options.

Penny Stocks – Penny Stocks in the US are commons stocks that trade from a penny a share up to five dollars a share. These stocks are traded over the counter (OTC) through quotation services and may or may not be available to track, trade, or screen via investment software. Check specific software options to make sure.

Forex or Foreign Exchange – Forex or foreign exchange market is a worldwide currency market. This market is used to trade currencies.

Bull vs Bear Market – A simplistic explanation of these financial terms is that a bull market and bear market are used to describe up and down stock market trends. A bull market is going up and is thought to signify that investors are confident; a bear market is going down and signifies caution or worry.

Stock Prices – This is the price set per share of stock. In order for a stock to be listed on the NASDAQ stock exchange, the stock needs to be valued at $1 or up for each share. If the stock is valued at less than a dollar, it is listed as an OTC or over the counter stock.

Autocomplete – Autocomplete as a term used by investment software, refers to completing sell or buy orders without human intervention. In other words, you set the software to sell a specific stock when it reaches the price of $100. Once the stock reaches that point, the software program issues the sell order without asking for your approval.

Price to earnings ratio or P/E – Price to earnings ratio allows you measure the amount you paid for one share of stock with the annual net income or profit earned by the company per one share. This measurement is used to evaluate how a stock is doing. A stock with a higher P/E number means the stock is more expensive compared to one with a lower P/E ratio. A P/E ratio is figured like this: if a stock is priced at $24 per share, and the earnings per share for the most recent year is $3, then the stock has a P/E ratio of 24/3 or 8. The company made $8 of profit for every share out there.

Well, this is a start. There are so many terms to learn and commit to memory. Let this small vocabulary sheet get you started in the world of investment software and investments.