Facebook stock (FB) has now been public for more than four years and it remains one of the most actively traded stocks on any exchange. The average number of shares that are bought and sold every day is about 23,000,000 at the time I write this.
If you want to know how to buy Facebook stock, this step by step guide will show you how. This guide is meant for investors from the United States as I am not familiar with how to buy stocks if you live in other countries.
1) You Need To Open An Online Discount Broker Account
The first thing you need to do in order to buy Facebook stock (or any stock) is to sign up and open a broker account. It can all be done online and will take approximately 30 minutes.
I recommend Motif Investing for investors of all levels. There are many other online discount brokers to choose from and some of the bigger names include E*Trade, TD Ameritrade, Scottrade, Merrill Edge, and Charles Schwab. But Motif Investing is a great choice for investors because of its industry low $4.95 per trade fee and there is no account minimum. You can also buy baskets of stocks (called Motifs) which allow investors to more easily diversify their holdings which is hard to do if you buy one stock at a time. However, any one of those brokers is a good option and you can buy Facebook stock with an account at any one of them. **Generally you must have a United States Social Security number and be living in the U.S. to open an online broker account**
2) You Need To Fund Your Account
Signing up for a new online account with an online broker is only the first step. Just as important is the act of “funding” your account. Funding encompasses the different ways you can put money into that account. After all, you can’t buy stock with a zero balance!
Many brokers have a $2,000 minimum to open a new account. That is why I like Motif: it has no minimum and you can open your account with whatever dollar amount you have. That’s great for anyone who is just starting out and doesn’t want to commit too much right away.
Most, if not all, online brokers have the same funding methods available and each will have a detailed section on how to do it. The two most popular ways are 1) electronic funding from a bank account to your new broker account and 2) to just write a check and send it to them. A check may take a week to get delivered and processed while the electronic option will only take a day or two to complete.
Other ways to fund most broker accounts are by transferring money from another brokerage account, a wire transfer, and cashing in stock certificates. Again, for every option available there should be clear and concise instruction on how to do it. Additionally, you will probably see a toll free phone number you can use to talk to a real person if you have further funding questions.
3) Waiting For Your Account To Be Funded
While you wait for the money you sent to actually be deposited in your new broker account, I suggest you sign up for a free account with Wall Street Survivor. You will get $100,000 of virtual currency and can practice buying and selling stocks on their simulated stock market. Much like the real thing, you will be able to get the feel of what trading stocks is like. Additionally, WSS has a variety of videos and courses (you have to pay a membership fee to access those) that will take any beginner and teach them the basics of investing and demystify much of the jargon that can be intimidating. All in all, Wall Street Survivor is a user friendly place to get started learning how to invest your money in stocks.
4) Buying Facebook Stock
Once your money shows up in your broker account, you will then be able to buy stock in any company that is publicly traded on the NASDAQ and New York Stock Exchange. With a few clicks of your computer mouse, the number of shares of Facebook you desire to purchase can be yours. The ticker symbol for Facebook is “FB” and you will use that to place your order.
Buying Facebook stock and all other stocks is real easy once you open that first broker account. Unfortunately, many potential young investors never get around to doing it and procrastination leads to them never having money in the stock market which is a huge financial mistake. The younger you are, the more important it is to put your money in stocks because you have time on your side: valuable time to wait out any market corrections and downturns because you don’t need that retirement money for many years.
Should you buy Facebook stock? It may or may not be a good investment and I can’t tell you whether you should buy it at the time you read this. As of October 2016, Facebook has become an extremely successful business and its purchases of Instagram and WhatsApp look like they will pay off many times over in the coming years. If Facebook had never bought them, those two companies would have undoubtedly gone public and we would all be wondering today whether Instagram stock and WhatsApp stock are worth buying. But now Facebook owns all three and is successfully starting to monetize them while continuing to sign up new users around the world. Its advertising business is doing exceptionally well and many analysts continue to rate the stock a “buy” even though the stock’s price is near an all time high in the $130’s.
Disclaimer: Please remember that you should always consult your financial planner or stock broker and the information on this website is my opinion and I never recommend you buy or sell any particular stock. I show you what stocks I am buying and selling but you should make your own decisions!