How to Buy Your First Stock (Step-by-Step for Dummies)

Buying a stock used to require a phone call and a $50 commission. Today, you can own a piece of Apple or Tesla in 5 minutes with $1. Here is the exact process.

BMT Investment Research Team BMT Investment Research Team · 📅 Jan 2026 · ⏱️ 5 min read · INVESTING › BASICS
Min Amount
$1
Fractional SharesStart
Fee
$0
CommissionsFree
Settlement
T+1
Funds ClearFast

The 3-Step Buying Process

You cannot buy stocks at a grocery store. You need a middleman called a “Broker.”

Step Action Time Needed
1. Open Account Submit ID & SSN 5 Mins
2. Fund Account Link Bank (ACH) 1-2 Days
3. Trade Select & Buy 10 Seconds
What is a Ticker Symbol?
A unique 1-4 letter code for each company.
• Apple = AAPL
• Tesla = TSLA
• S&P 500 ETF = VOO
Barrier to Entry
1990s (Phone) $50 Fee
Expensive & Slow.
2010s (Online) $7 Fee
Cheaper, but full shares only.
2026 (App) $0 Fee
Free & Instant ($1 min).
ReqDetails
Age18+ (or Custodial)
IDSSN Required

Critical: “Market” vs. “Limit” Order

When you click Buy, the app will ask “Order Type.” Choosing the wrong one can cost you money.

1. Market Order (Speed)

“I want to buy this stock right now at whatever price is available.”
Risk: If the price spikes suddenly, you might pay more than you expected.

2. Limit Order (Price Control)

“I want to buy this stock, but only if the price is $150 or lower.”
Risk: If the price never drops to $150, your trade will not execute.

Beginner Tip

Always use a Limit Order when the market is volatile. It guarantees you never overpay.

Can’t Afford a Full Share?

Some stocks are expensive (e.g., one share of Booking Holdings is over $3,500). You do not need that much money.

Dollar-Based Investing

Instead of buying “1 Share,” you can choose to buy “$50 worth.” The brokerage will give you 0.014 shares. You still get the same percentage of gains and dividends.

Frequently Asked Questions

When can I sell?
Anytime the market is open (9:30 AM – 4:00 PM ET, Mon-Fri). However, buying and selling the same stock on the same day is called “Day Trading” and has strict rules for accounts under $25k.
Do I pay taxes?
You only pay taxes when you sell for a profit. Holding a stock that went up in value does not trigger a tax bill until you sell it (Realized Gain).