The most important question asked regarding investments in shares is that how much initial investment is required for a beginner? What is the minimum amount of money required to start your investment? If you are new to this world, you might think that all you have to do is to go to the brokerage firm and register an account. It may not always be that simple. There are few things that should be kept in mind before you put your money into the riskiest business.
Every company has its own minimum deposit rules. Most of the companies do not allow you to invest your money if it is below $1000. Thus, $1000 is considered to be the Minimum Investment to start an investment.
Types of Services:
One important thing to be understood is that you may not cherish all the facilities related to the broker service if you have a low investment. In this respect there are two types of services offered by the brokers:
- Full Service – As obvious from the name that the brokers would provide you the best service but obviously to those clients who have a higher net worth. Those who have an investment of about $50,000 or more.
- Discount Service – For an investment as low as $1000, the brokers may not provide you the all the services that are available to the Higher net worth clients. But the fees for those services will be quite low as compared to the other service. But you cannot call them for advice.
Types of Bonds:
There are two types of bonds available in the market:
- Mutual Bonds – These are simpler in terms of minimum investment restrictions. You can buy them from banks and also from any brokerage firms.
- Government Bonds – These bonds can be bought directly from the government through Treasury Direct.
A Small Step towards a Bright Future:
It is not always as simple as selecting an investment and putting your money in it. There are a few things you have to be aware of. You would have to find the minimum investment requirements and then compare it with other brokers and then make your decisions. It may happen that you may not be able to buy the right investment but it will give you enough experience to start with. The best thing in this respect would be to start with mutual bonds that have the minimum risk of loss.
Every account has some maintenance fees that everyone has to pay. There are no exceptions to it. But the simplest way of going into this business without paying administration and maintenance fee is to select TFSA plan for your Online Trading with Minimum Investment. Other accounts are often subjected to $100 maintenance fee per year which is not attractive to those Investors that are starting to build their assets from nothing.
In order to reduce your risk in the investment if you are a newcomer, you need to diversify your investments. What it means is that if you are supposed to invest $1000 then instead of putting it in the single company you should prefer investing it in two companies. That would help you to reduce the amount of risk.