How to Buy Canadian Stocks

When looking at how to buy Canadian stocks, it's important that you have a good understanding of the risks of stock trading and have risk capital to trade with. In this video, I talk about the importance of having risk capital to trade with.

Unless you have a lot of money and are able to afford a place on the Toronto Stock Exchange, you will need to buy your stocks through a stock broker. A broker buys and sells stocks on your behalf.

Choosing the right broker can make a huge difference to your bottom line when you are trading the Canadian stock market. Unfortunately, many brokers are much more interested in extracting as much money from you as they can, rather than giving you a cost effective trading platform.

I have spent a lot of time researching brokers to help get you the best deal for your money. The results of my findings can be found on my Canadian Stock Brokers page.

To help you find stocks, you may want to use a stock screener. This is a tool that lets you search for stocks based on a criteria you select. For example, you could search for stocks with a market cap of more than $100m with an earnings per share of less than 20. A stock screener allows you to select your criteria, it then shows you the results for your search. I have put together a list of Canadian stock screeners here.

When buying Canadian stocks or rather any stocks for that matter, it is absolutely essential to have a good stock trading strategy and use good risk management. It is always useful to test trading strategies on a simulated account, prior to trading it with real money. If a strategy doesn't make money, i'd much rather find out with pretend money than real money!

Conclusion

As with any stocks, when trading Canadian stocks it's important to have a good stock broker, a good trading system and good risk management. If you can get these three factors right, you will significantly improve your chances of earning good returns on your hard earned cash.