Is Firstrade a good brokerage firm for beginners in 2019? New investor: how to buy your first stock or ETF on Firstrade?

Overview of Firstrade for Beginners

Firstrade is another broker that is gaining in popularity in large part due to its $0 commissions. If you’re brand new to the world of investing and looking for a brokerage account that is easy to use and great for beginners, we would highly recommend Firstrade. This article will show you how easy it is to open a Firstrade account and then how you can place your first trade on their platform.

Opening an Account

Opening an account with Firstrade is as easy as ever, especially since the whole process can be done online and shouldn’t take more than ten minutes. All you will need to have handy with you is your social security number (SSN), contact details, and your checking account number and bank’s routing number if you plan to also fund your Firstrade account at the same time.

Firstrade’s application process is pretty self-explanatory but if you’d like us to walk you through it we’d recommend reading our other article Firstrade New Account Application which will guide you step by step.

Easy to Navigate

While we find that Firstrade’s website has more going on (in terms of research tools, screeners, education, etc.) than some of the other free brokers, like Robinhood, their website is setup in a very intuitive manner that makes finding where you need to go relatively easy. Once you login to your account, you’ll be taken to the screenshot below, which offers a summary of your portfolio and watchlist, the day’s market movers, and most importantly the menu bar up top, which is going to be your launchpad to all the site’s important areas.

Firstrade For Beginners

Figuratively speaking, this launchpad includes submenus for your account (showing detailed balances), research and tools (such as stock screeners, earnings, and charts), customer service, and an education center (this is a great place for beginners to learn about investing and the markets). The other important submenu is the “Trading” section, which is where you’ll go to place trades, and subsequently will be the focus of the rest of this article.

Placing a Stock Trade

So you’ve opened your Firstrade account and you already know you want 150 shares of Apple stock (AAPL) in your portfolio, and you’re wondering… how do I actually create this order? It’s very simple, and we’re going to walk you through this process now. After you click on the “Trading” section of the menu at the top of the screen a second series of submenus appear below it showing “Order Status”, “Stocks/ETFs”, “Options”, etc. Depending on which type of security you want to buy, you will click on the corresponding submenu. We clicked on “Stocks/ETFs” because we want to buy AAPL stock, not options, mutual funds, or fixed income.

This takes us to the below screen, which is the order ticket, used to enter the details of your order. For the transaction type, we select “Buy” and for the symbol we enter the ticker for Apple stock – AAPL. You’ll notice that as soon as type in the ticker a real-time quote for AAPL stock populates telling us the last price ($209.10), bid and ask prices, volume, and other helpful stock quote information.

Firstrade Trading For Beginners

We also have to tell Firstrade how many shares we want to purchase (we said we want 150) and the order type. The default order type on Firstrade, and perhaps the most popular order type, is called a limit order. With a limit order, we have to specify a limit price, which is the highest price per share we are willing to pay for these shares. For this order, we entered a limit price of $209, which is $0.10 below AAPL’s last price, and means that our order may only be filled if the ask price comes down to meet our limit price. The default duration is “Day”, and means that if the order isn’t filled by the market close it is automatically cancelled. Next, just click “Send Order” and the order will be submitted for execution.

Buying a Mutual Fund

Because Firstrade also offers commission-free mutual fund investing and because order tickets for mutual funds are a little different we will walk through a mutual fund example as well. If you go back up to the submenu options underneath “Trading” you will see there is one called “Mutual Funds”, which is where we want to go for this next example.

Below is what the mutual fund order ticket looks like on Firstrade. There are fewer inputs here which make this trade even easier to enter. Similar to the prior example, you want to select “Buy” for the transaction type. In the “Fund Family” drop-down menu, you want to select the fund group to which the mutual fund you want to buy belongs – which if Vanguard for our example. Below that you want to enter the fund’s ticker or symbol, which for us is NAESX as we are purchasing shares in Vanguard’s Small Cap Index Fund.

Firstrade Buy Mutual Fund For Beginners

Next we have to enter the $ amount that we would like to invest in the mutual fund – we said $3,000.00, which is the minimum initial investment you can make in this particular mutual fund. You may be wondering why in this example we indicated how much money we wanted to invest in the mutual fund whereas in the prior example with AAPL stock we indicated how many shares we wanted and our limit price. This is because the NAV or price per share of a mutual fund is only calculated at the end of the day after market close, and this is the price that everyone buying and selling the mutual fund that day will transact at.

The trade ticket will also ask you whether you want the mutual fund’s dividends (assuming it pays any) reinvested for you automatically or if you want to receive them in cash in your account. Other important information on the trade ticket includes a link to the prospectus (which will list the fund’s fees and much more), whether or not there is a load fee (i.e. a purchase premium or sales charge), and the fund’s cut-off time (the latest time you can submit an order to have it be executed that day).

Id Firstrade Good for Beginners Summary

Opening an account with Firstrade is a very quick and easy process, and once open, Firstrade’s website is laid out in such a way that it’s easy to navigate and place orders. This is why this brokerage is a great place for beginners to open an account.


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