Opening an E*TRADE account and funding it

Before you can buy stocks on E*TRADE, you need an account and money in it. E*TRADE offers several account types — a standard brokerage account is the simplest if you're just starting out. You'll go to E*TRADE's website, click "Open an Account," and choose the account type that fits your situation.

The sign-up process asks for your Social Security number, employment information, and funding method. E*TRADE will verify your identity and typically approves accounts within one business day. Once approved, you can fund the account by linking a bank account, transferring money from another brokerage, or mailing a check — though bank transfers are fastest.

You don't need a minimum amount to open the account, but you do need enough cash in it to actually buy shares. Stock prices vary widely: some trade for under $10 per share, others for hundreds. E*TRADE charges no commission on stock trades, so the only cost is the price of the shares themselves.

Key Takeaways

  • Open a standard brokerage account on E*TRADE's website, verify your identity, and fund it through a linked bank account or transfer.
  • Use the E*TRADE platform to search for a stock by its ticker symbol, review the current price and basic information, and decide how many shares you want to buy.
  • Place a market order to buy at the current price immediately, or a limit order to buy only if the price drops to a specific level you set.
  • Your order executes during market hours (9:30 a.m. to 4 p.m. Eastern time on weekdays), and the shares appear in your account once the trade settles, usually within two business days.
  • E*TRADE charges no commission on stock trades, but you pay the actual share price plus any bid-ask spread that exists at the moment you buy.

Finding and researching a stock to buy

Once your account is funded, log into E*TRADE and look for the "Trade" or "Stocks" section. You'll see a search box where you can type a company name or its ticker symbol — the short code that identifies a stock, like AAPL for Apple or MSFT for Microsoft. If you don't know the ticker, typing the company name usually brings up the right result.

E*TRADE shows you the stock's current price, the day's high and low, and basic company information. You can also see charts showing how the price has moved over different time periods. This is informational — it helps you understand what you're buying, but it's not a recommendation to buy or sell.

Before you buy, think about how much of your money you want to put into this one stock. Most financial advisors suggest not putting all your money into a single company. If a stock costs $50 per share and you have $1,000, you could buy 20 shares, or you could buy fewer shares and keep some cash for other investments.

Placing a market order versus a limit order

E*TRADE offers two main ways to buy: a market order and a limit order. A market order buys the stock at whatever price it's trading at right now. If Apple is at $150 per share and you place a market order for 10 shares, you'll pay approximately $1,500 (plus any small spread). Market orders execute almost instantly during market hours.

A limit order lets you set a maximum price you're willing to pay. If you think a stock is worth $50 but it's currently trading at $52, you can place a limit order to buy at $50. The order sits in the system and only executes if the price drops to $50 or lower. The trade-off is that your order might never fill — if the stock never reaches your price, you don't buy anything.

For most new investors, a market order is simpler: you decide how many shares you want, you see the approximate cost, and the trade happens right away. Limit orders are useful if you're willing to wait and want to avoid overpaying, but they require more attention.

Entering the order and confirming the trade

To place an order on E*TRADE, click on the stock and select "Buy." The platform shows you a form where you enter the number of shares you want and choose your order type (market or limit). If you're placing a limit order, you also enter your maximum price.

E*TRADE displays a preview of your order before you confirm it. This shows the stock name, number of shares, order type, and estimated cost. Review this carefully — it's your last chance to catch a mistake before the order goes through. Once you click "Confirm" or "Submit," the order is live.

Market orders execute within seconds during market hours (9:30 a.m. to 4 p.m. Eastern time, Monday through Friday). If you place an order after market close or on a weekend, it waits until the market opens the next trading day. After your order executes, you'll see a confirmation number and the trade will appear in your account history.

Understanding settlement and when shares appear in your account

After you buy a stock, the trade doesn't settle immediately. Settlement is the process where the money leaves your account and the shares officially become yours. On E*TRADE, stocks settle in T+2, which means two business days after the trade date. If you buy on a Monday, the shares appear in your account on Wednesday (assuming neither day is a holiday).

Until settlement is complete, the shares show as "pending" or "unsettled" in your account. You can see them, but you can't sell them yet. The cash is also held during this period. This delay is standard across all brokerages and is part of how the financial system works.

Once settlement is complete, the shares are fully yours. You can sell them, hold them, or buy more. E*TRACK sends you a confirmation email when settlement happens.

Monitoring your position and next steps

After your shares settle, they appear in your account under "Positions" or "Holdings." E*TRADE shows you the number of shares you own, the price you paid per share, the current price, and your total gain or loss in dollars and percentage. This updates throughout each trading day.

You don't have to do anything with your shares once you own them. You can hold them indefinitely, sell them whenever you want during market hours, or buy more. If the company pays a dividend (a cash payment to shareholders), E*TRADE deposits it into your account automatically.

As you get more comfortable, you might explore other features like setting price alerts (E*TRADE notifies you if a stock hits a certain price), researching other stocks, or learning about different order types. E*TRADE's website has educational resources and tools for this.

Costs and fees to understand

E*TRADE charges no commission on stock trades, which means you don't pay a per-trade fee. The only cost is the actual price of the shares themselves. However, there is a small difference between the "bid" price (what buyers will pay) and the "ask" price (what sellers want). When you buy, you typically pay the ask price, which is slightly higher. This spread is usually just a few cents per share, but it's a real cost.

E*TRADE does charge fees for other services — for example, if you want a margin account (borrowing money to buy stocks) or if you hold certain types of investments. For a basic brokerage account buying stocks, there are no hidden fees beyond the bid-ask spread.

Frequently Asked Questions

Can I buy stocks after the market closes?

You can place an order anytime, but it won't execute until the market opens. If you place a market order at 6 p.m., it waits until 9:30 a.m. the next trading day to fill. Limit orders also wait, but they'll execute whenever the price hits your limit, even days later.

What's the minimum amount of money I need to start buying stocks?

E*TRADE has no account minimum. You can open an account with any amount and buy as few shares as you want. If a stock costs $100 per share, you can buy just one share with $100.

What happens if I change my mind after placing an order?

If your order hasn't executed yet, you can cancel it. Log into E*TRADE, find the pending order, and click "Cancel." If the order has already executed, you own the shares and would need to sell them to get your money back.

Do I have to pay taxes on stocks I buy?

You pay taxes on gains when you sell, not when you buy. If you buy a stock for $100 and sell it for $150, you owe tax on the $50 gain. E*TRADE sends you tax documents at the end of the year, but you're responsible for reporting this to the IRS.

Can I set up automatic purchases of the same stock every month?

E*TRADE offers a feature called automatic investment plans where you can set up recurring purchases. You choose the stock, the dollar amount or number of shares, and the frequency. This is useful if you want to invest a fixed amount regularly without having to place an order each time.