How to buy stocks in Canada-Fundamentals

This is a guide for “How to buy stocks in Canada beginners“.

1. Bid Price: The bid price is the highest price a buyer is willing to pay for a stock or other security at a given moment. It represents the maximum price someone is currently willing to pay to purchase the stock.
2. Ask Price: The ask price, also known as the “offer” price, is the lowest price at which a seller is willing to sell a stock or security. It represents the minimum price at which someone is currently willing to sell the stock.
3. Last Sale: The last sale price is the price at which the most recent transaction for a particular stock took place on the exchange.
4. Open: The opening price is the price at which a particular stock or security started trading at the beginning of the trading day.
5. High: The high price is the highest price at which a stock or security traded during a specific period, usually a trading day.
6. Low: The low price is the lowest price at which a stock or security traded during a specific period, typically a trading day.
7. Exchange: An exchange is a marketplace where buyers and sellers come together to trade stocks, bonds, commodities, and other financial instruments. Examples include the New York Stock Exchange (NYSE) and the Nasdaq.
8. Market Cap (Market Capitalization): Market capitalization is the total value of a company’s outstanding shares of stock. It is calculated by multiplying the current market price per share by the total number of outstanding shares.
9. P/E Ratio (Price-to-Earnings Ratio): The price-to-earnings ratio is a valuation metric that compares a company’s stock price to its earnings per share (EPS). It helps investors assess whether a stock is overvalued or undervalued.
10. 52-Week High: The 52-week high is the highest price at which a stock has traded during the past 52 weeks (one year).
11. 52-Week Low: The 52-week low is the lowest price at which a stock has traded during the past 52 weeks (one year).
12. Volume: Volume refers to the total number of shares of a stock or security that have been traded during a given period, typically a trading day. It indicates the level of market activity for that stock.
13. Average Volume: Average volume is the average number of shares traded per day over a specific period, usually 30 days. It provides insight into the stock’s liquidity and trading patterns.
14. Yield: Yield is the income generated from an investment relative to its cost. For stocks, yield typically refers to dividend yield, which is the annual dividend payment of a stock divided by its current market price. It’s expressed as a percentage.

1. Market Order: A market order is an instruction given by an investor to a brokerage to buy or sell a security at the prevailing market price. This type of order is executed immediately at the best available price in the market. The exact price at which the trade is executed may vary slightly from the current quoted price due to market fluctuations and liquidity.
2. Limit Order: A limit order is an instruction given by an investor to a brokerage to buy or sell a security at a specific price or better. When placing a limit order to buy, the investor specifies the maximum price they are willing to pay. When placing a limit order to sell, the investor specifies the minimum price they are willing to accept. The trade will only be executed if the market reaches the specified price or better.
3. Market Buy: A market buy order is a request to purchase a security at the current market price. It is executed immediately at the best available price in the market. This type of order is used when the investor wants to buy a security quickly and is less concerned about the exact price of execution.
4. Limit Buy: A limit buy order is an instruction to buy a security at a specific price or lower. It will only be executed if the market price reaches the specified price or goes below it. This type of order allows the investor to control the purchase price and potentially get a better deal.
5. Market Sell: A market sell order is a request to sell a security at the current market price. It is executed immediately at the best available price in the market. This type of order is used when the investor wants to sell a security quickly and is less concerned about the exact price of execution.
6. Limit Sell: A limit sell order is an instruction to sell a security at a specific price or higher. It will only be executed if the market price reaches the specified price or goes above it. This type of order allows the investor to control the selling price and potentially get a better return.