Welcome to Alpha’s Share Education Center. Whether you are just beginning to trade or you are a seasoned investor looking for new trading strategies, this Centre provides a wealth of information on the most relevant topics.

What are shares?

Welcome to Alpha’s Share Education Centre. Whether you are just beginning to trade or you are a seasoned investor looking for new trading strategies, this Centrer provides a wealth of information on the most relevant topics.

Company shares are probably the most well known financial instruments in the world. When you buy a stock, you are purchasing a given number of a company’s shares that represent ownership of a corporation. Every incorporated company has stock, but only those that are traded on a public exchange are of interest to investors.

Stock market exchanges are found all over the world, from New York to Copenhagen and Hong Kong. Typically, a German exchange will trade German companies and a Swiss exchange Swiss companies, but larger companies are often traded on more than one exchange. The trading takes place on the exchange itself where prices fluctuate according to the laws of supply and demand.

Obtaining Stock Quotes

Alpha’s online trading platforms allow you to obtain stock quotes from the ASX and a range of international exchanges, but there is a 15-minute exchange-regulated delay on the quotes. If you need an up to the minute quote, you can get virtually live quotes by viewing a quote for a CFD on the equivalent stock.

For example, if Harley Davidson is quoted at 44.00 on a 15-minute delayed quote, you can just type in the symbol for a Harley Davidson stock and view streamed quotes that are updated regularly. If the quoted price is bid 43.87 and ask 43.95, for example, you can see that the current price for the stock is around the midpoint between those two prices.

Through the AlphaTrader and AlphaGlobal platforms your can view stock charts for stocks that are members of major national indexes like the FTSE 100 and S&P 500.

As stocks are traded on an exchange, there is a 15-minute exchange-regulated delay on the stock quotes. However, for if you are enabled to trade physical stocks on NYSE/NASDAQ, you will receive real-time quotes on these exchanges.

Placing Stock Orders

Since the process of buying stock through our online platforms is fully automated, trading is carried out almost immediately for any heavily traded stock.

Placing an order to buy a stock is as simple as typing in the symbol in the online trading window, entering the number of shares and then selecting Buy or Sell and then clicking on “Place Order”. In a few seconds, the order will have been executed. Because stock trading has to go through an exchange, you will not necessarily get the stock for the most recent price you have seen for the stock, because the market can move for or against you, even in the seconds it takes to fill an order. But if you place a market order, you will get the stock.

The above is also achievable by phoning your Financial Adviser and placing a phone order.

Placing Limit Orders

Instead of trading the current market price, you can place a limit order.

If you use a buy limit order, you are saying that you don’t want to buy the stock until its price has fallen to a specific level. Let’s say that you are interested in buying Harley Davidson stock, which is currently trading at 44.00. But, you think the price will go somewhat lower and therefore you don’t want to buy at the current level, but at 42.00. Instead of having to watch the screen and wait for the market price to descend to 42.00 (if it ever does), you can place a limit order to buy at 42.00 that will automatically execute when the market reaches that price.

Note that the trade is only triggered when the market reaches that price, it does not guarantee that your trade will be executed at precisely 42.00. Especially in fast moving markets, the actual price at the time of execution may be slightly or significantly lower than specified in your limit order, depending on the speed of the market’s movements.

The above is also achievable by phoning your Financial Adviser and placing a phone order.

What are the risks involved?

The risk of owning company stock consists of:

  • a business risk
  • a financial risk

The business risk is the risk related to the prospects for the type of business the company is involved in, and the financial risk depends on its financial structure; i.e. a lot of debt, for example, increases the risks. By creating portfolios consisting of several stocks from different industries it is possible to reduce your overall risk significantly.

In order to trade stocks you need sufficient information about the market, the news, market trends and access to quotes on all stocks.

Further Education 

If you would like more information and learn about shares trading please contact 03 8662 4000 to speak with one of our Financial Advisers

The Australian Stock Exchange provides free general education: