ANSWERS: 1
  • When an investor wants to purchase, sell, trade and hold securities he opens a stock account. The account will show transactions made and any activity done in the account.

    Opening the Account

    A new account form will have to be completed. Information required includes name, address, phone number and investment objectives.

    Types

    A stock account will be classified as a cash account unless margin papers are signed. If a stock account has margin privileges, the owner is taking a loan out to purchase stocks using holdings as collateral.

    Benefits

    A stock account will hold the customer's securities. It allows the owner of the account to buy, sell and trade. A stock account also provides a safe holding place where the securities will be maintained.

    Size

    A stock account can be opened with a small amount of money or with a large sum. One single transaction can be done or many trades can be executed.

    Function

    A stock account can be used as a way to grow investments, earn profits and save. It can also serve as a way to actively trade securities.

    Potential

    The potential exists for many rewards when investing and using a stock account. Risks also abound, so use caution, knowledge and your experience to make your trades.

    Source:

    MSN Money Central: Investing For Beginners

    SEC.gov: A Beginner's Guide to Investing

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