As someone who wishes to earn an income investing in stocks, bonds, and options, you should first acquire an account with a reliable stockbroker. Of course, this is truly much easier said than done. There are innumerable brokers on the market and each of these entities will offer a handful of different account options. In order to make the right choice for your individualistic situation, you should first examine your specific needs, preferences and desires. Within this guide, you will be able to learn about the available CMC Markets account types and will also be able to figure out precisely which one is right for you.
Understanding Your Desires
Before taking the time to explore your options, you should first familiarize yourself with your preferences. Each investor is different and each will want to be able to trade something different. Also, some are more willing to take risks, while others will prefer to keep their risks to a minimum. You should also figure out precisely how much you’ll be able to spend on your investments. Some brokers require investors to deposit a large quantity, before they’ll be allowed to open their accounts.
Attempting to figure out precisely what you wish to trade is pertinent. Generally, the majority of brokers will offer a specific account for stocks and another for options. Before attempting to make your determination, you should learn about both types of investments and choose the one that best suits your trading style and risk limitations.
Stockbroking Account Options
If you’re interested in trading stock on the Australian Stock Exchange, you’ll need to acquire a compatible account. Generally, this type of account will be referred to as a stockbroking account and it’ll normally give you access to a handful of different trading tools, which will help you make the right investments for your money. Of course, the account selection process doesn’t end there. You should also figure out how often you desire to check the market’s statistics and data. Different brokers may charge a monthly fee for investors, who wish to receive live market data.
Accessing Market-Price Data
If you opt for a stockbroking account, you should understand that you may or may not be provided with live market data for free. Some brokers will charge a fee, in order to access this information. When examining the CMC Markets account types, you will find that the broker offers three individualistic market data plans to their investors. These options will be explored in greater detail below.
- Delayed data – Although this option is free, the market’s prices and figures will only be updated every 20 minutes
- Live data – If you wish to keep track of your progress and income every second of the day, you should upgrade to live data. Advancing to an Active Investor account or paying a minute fee a month will give you access to this feature.
- Dynamic data – Dynamic data provides the investor with live market data, as well as an array of other information, which will prove to make investments more profitable. Accessing this feature is as simple as opting for a Premium Tier Trading account or paying a hefty monthly fee.
Although some investors will clamor to invest in stocks, others will want to be able to profit additionally, by also investing in options. Options can be a very helpful way to diversify your portfolio, while backing up the value of your shares. Remember that you’ll have two trading options, when investing in options. For your consideration, both of these will be examined below.
- Call Option – The call option can be very beneficial for investors, who wish to back out in the future. With the call option, the investor makes an agreement with the seller that they’ll purchase a stock, commodity, or bond at a specific price, within an agreed upon period of time. Of course, this is not an obligation, so the investor is somewhat safer with this strategy.
- Put Option – The put option is exactly the opposite of the call option. Instead of buying the security, the investor is actually agreeing to sell the underlying security for an agreed upon price, within a specific amount of time. Again, there is no obligation, so backing out in the future is always a possibility.
If you truly wish to invest in the ASX, you should make sure to open an account with a good broker. Above, you have learned about your account options, and will now have a better chance of opening the account, which suits your trading style the best.