How To Buy Shares In Pakistan Stock Exchange

What is a stock exchange? How can we buy shares on the Pakistan Stock Exchange? Are there easy methods or techniques available in Pakistan to buy stock exchange shares? These are a few questions that strike in everyone's mind when they hear about words like 'Shares' or 'Stocks'.

Let's start with the stock exchange. The stock exchange is like a market place where the shares of different companies are traded publically. In other words, it is a method to buy and sell shares of companies.

As an investor, you have the right to choose the stocks of different companies to build your investment portfolio. You can buy and sell in the stock market through the license by the Securities and Exchange Commission of Pakistan (SECP) or Trading Rights Entitlement Certificate (TREC) brokerage firms acknowledged by PSX.

At the base of the individual preference, you need to shortlist some brokerage firms. There are many brokers available in the Pakistani market of the stock exchange where you can purchase shares.

Now, we will discuss the six easy steps to buy shares on the Pakistan Stock Exchange.

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Step 1: Find a Broker Online or Physically

The first step is to find a good broker online or physically in Pakistan. By answering a few questions, the broker will help you get a bit of free advice, or you will have to pay some amount to get experienced broker advice.

When advising a broker, we estimate the broker's account fees, accessible markets to trade, trading platform, and how it is easy to open an account. In Pakistan, there are many scam brokers. People do not trust online things. They always believe in physical appearance. So you need to find a reliable person. Safety is also necessary, so we advise you to go only for safe brokers.

Step 2: Open an Account for Investment

Once you find your broker physically or online, you need to open an account for investment. You can do it online or by going to the office of your broker. In Pakistan, there are many physical offices situated in different places or cities. You can go to the stock office and easily open your account without facing any issue regarding the account opening.

The primary purpose of opening an investment account is to start buying shares. You can do all your work online by sitting at your home. Think of it as a bank account where you can hold cash as well as shares. Usually, for opening a brokerage account, it takes a few days, although, with some references, you can do this in a day. Both ways are not too difficult; once you tried.

Step 3: Add Money to your Account

To buy shares, you must have money in your account for investment. You can also purchase fractional shares at some brokers. For example, if the one share price is over 2000 rupees, and you want to invest 500 rupees, you can do it with only that amount.

Usually, you can choose a depositing funds method via debit/credit card or a bank transfer. At some brokers, you can deposit funds into your account via your bank account.

Step 4: Search a Stock You Want to Buy

You can do your search, or you can get inspiration from the ideas of the others. There are many experts available in the market to gain knowledge about the stock markets of Pakistan. For example, on one side, you can buy some stocks that your friend owns. On the other side, if you spent some time and energy on research, you can get more ideas from it.

In the form of stock analyses and reports, the idea of buying shares can come from your brokers. You can also use independent research for it. The investment courses and financial news can be useful for choosing a stock.

In Pakistan, many institutes offer these courses. The learning process helps us to pick a winning stock share in the market to buy.

Step 5: Purchase/Buy the Stock

Now you have all the necessary things (account, the cash, and the stock preference) to buy a stock. You need to click the buy button. First, log in to your trading platform, find your chosen stock share, then enter the number of stock shares you want to buy and click the Buy button to start buying shares.

Alternatively, you can also choose how much you would like to spend on the given stock. While placing an order, you may select from the different types of orders. A limit order permits you to identify the actual price at which you want to purchase the shares, while a market order buys at once at the current market price.

Step 6: Regularly, Check the Positions of Your Shares

You have completed your work because you have bought the shares that you wanted to buy. Now the next step is to monitor your investment. If you have to buy shares to take it for the long term, you do not need to see its price movement every day. But you need to check its reports quarterly or yearly and company guidance. It means monitoring your investment from time to time.

If a buyer takes shares for the short term, then position management means to set up a target price where you want to sell your shares with a profit margin or find a stop-loss price where you cut losses.

These easy steps help you to buy shares on the Pakistan Stock Exchange. In a country like Pakistan, you need to follow these steps to avoid fake people. You just need to understand all steps one by one. Once you understood all the procedure of buying shares, you will never face difficulties in the future.