How to trade shares
When you choose FXOpen, you will open a share trading account and can immediately start trading in the equity market. This is done using derivatives known as contracts for difference (CFDs). Rather than being an owner of any shares, you'll decide whether you think the share price will go up or down.
Share trading is growing in popularity. This is because you don't need to invest a lot to get started. CFD trading gives you full exposure to the share market with a small upfront investment. From there, you predict which way the share price is going to move.
With a CFD, you are agreeing to swap the difference in the share price from when you opened your position to when you close it. If the price moves in the direction you expected during the time your position is open, you’ll profit. If it doesn’t move in line with your prediction, your investment will become a loss.
- Trader A makes a $1,000 trade on Company B's share price at $10.00
- Trader A predicts the price will go up to $12.50
- Trader A buys 100 contracts at $10 a share
- Company B's share price increases to $12.50
- The initial trade value is $1,000, but the final value is $1,250
Before charges and commission, Trader A makes a gross profit of $250.
To get started with the FXOpen share trading platform, open your free account today.
Begin share trading in Hong Kong with FXOpen
Whether you’re new to share trading or you’re experienced in the equity trading process, you’ll find that you are in the same starting position as other traders when you open your position. Therefore, knowing what your plan is when you first take up your opening position is crucial. Having a plan will help you decide when to close your position.
Using your FXOpen share trading account, you can access the information you need to make the right decisions when it counts. From accessing analytic insights to help you build your trading knowledge to acting on instinct, you can use the equity trading platform – which features the latest software – to develop your strategy. As long as you remember to never risk more than you can afford to lose, you are in a good position to start share trading.
What to look out for when trading stocks and shares
- Company news or changes: Annual reports, changes in forecasted profits, or new products can all potentially drive a company's share price up or down.
- Share supply and demand: If shares in a company are at a premium, high demand can outweigh supply. This, in turn, drives up the share price.
- Economic updates: Economic changes, both on a national and an international level, can significantly impact share prices.
- Market trends: This is perhaps something to consider as you build your expertise in share trading, but any major trends within a specific market can affect the value of a company. For instance, stocks in airlines have been negatively impacted as a result of reduced travel during the Covid-19 pandemic.
- Investor mood/confidence: Confidence that investors have in a particular company or sector can also play a part in the fortunes of the share market. The reasons for this may not be apparent, so it’s worth finding out what the overall opinion is of companies that you’re interested in.
FXOpen: The share trading platform for discerning investors
Sign up with FXOpen and use our ECN accounts to trade on the raw price of a share. You’ll only need to pay a small commission to do this.
Plus, our accounts are multi-asset, so you can make your portfolio as diverse as you want it to be. As well as trading stocks and shares, you can trade other CFDs, including forex, global indices, and commodities.
You're in total control with FXOpen. We're here to enhance your trading experience and help you get the most out of the investments you make. Get in touch with our team today to find out more. If you have some burning questions, we might have already answered them in our FAQs.
Why do people trade stocks and shares?
Shares are a popular trading instrument for investors. This is typically because of the liquidity available. The market is full of opportunities to trade, so it's always possible to find new and exciting avenues to explore.
Another reason it’s so popular is that a company's share price and underlying value is transparent. The better the company performs, the more likely it is for its share price to increase. Likewise, it’s possible to take advantage of volatility, especially when companies are more exposed to major economic or political events.
Trading shares as CFDs using leverage with FXOpen means a smaller amount of capital is needed. This leverage gives you full market exposure.
How much does online share trading cost?
You pay a small commission when you trade shares using CFDs. This is paid when you open and close your position.
At FXOpen, our commissions start from USD$1.50 per standard lot. The rate depends on your Monthly Traded Volume and Account Equity. There is an additional overnight charge to consider if you’re planning on taking a longer position. Our Knowledge Base offers more details about this.
We’re here to help if you have questions about this or any other aspect of share trading. Get in touch with our team. Our live chat service is also available 1pm to 1am Hong Kong time.
Trading stocks and shares: What to consider
Like all trading, there is always risk involved if you choose to trade shares. You can profit from online share trading, but it’s important to note that using CFDs to buy shares online fully exposes you to the share market and you may lose some – or all – of your initial investment. In some cases, losses can happen quickly due to leverage. Therefore, you should never risk more than you can afford to lose.
It is also worth ensuring you fully understand how CFDs work before you begin trading. CFDs are complex instruments and the risk is significant. For more support, please take a look at our Knowledge Base.
If you're aware of all the risks involved, using CFDs for equity trading wherever you are in Hong Kong can be highly rewarding.
with FXOpen
*Cryptocurrency CFDs are only available for trading by those clients categorised as Professional clients under FCA Rules. They are not available for trading by Retail clients.