Opening your account and funding it

To buy stock through Fidelity, you first open a brokerage account, fund it with money, and then place an order for the shares you want. The account setup takes about 10 minutes online, and you can start trading the same day or the next business day depending on how you fund it.

Go to Fidelity.com and click "Open an account." You'll choose between a standard taxable brokerage account (the most common choice for stock buying) or a retirement account like an IRA if that fits your situation. You'll provide your Social Security number, employment information, and banking details. Fidelity will verify your identity and typically approve you within minutes.

Once approved, you need to move money into the account before you can buy anything. You can link your bank account and transfer funds electronically—this usually takes one to three business days to settle. You can also mail a check, though that's slower. Some people fund their account by transferring stocks or investments they already own at another brokerage, which Fidelity calls an "incoming transfer."

Key Takeaways

  • Open a brokerage account at Fidelity.com, provide your Social Security number and bank information, and receive approval within minutes.
  • Fund your account by linking your bank account and transferring money, which settles in one to three business days.
  • Search for a stock by ticker symbol in the Fidelity platform, review the company information and price, and place a buy order.
  • Choose between a market order (buy at the current price immediately) or a limit order (buy only if the price drops to a level you set).
  • Your order settles in two business days, meaning the shares officially become yours and appear in your account.

Finding and researching a stock before you buy

Once your account is funded, you search for the stock you want to buy using its ticker symbol—a one- to five-letter code that identifies each company. Apple is AAPL, Microsoft is MSFT, and Tesla is TSLA. If you don't know the ticker, Fidelity's search box will find it when you type the company name.

Fidelity shows you the current price, the price history over different time periods, and basic company information like what the business does and its market value. You can also see news articles, analyst ratings, and financial statements. This research is free and built into your account—you don't need to pay for a separate service or subscription.

Before you buy, understand what you're paying for. The stock price shown is the price per share. If a stock costs $50 per share and you want to buy 10 shares, you'll spend $500 plus any commission (though Fidelity charges no commission on stock trades). The price changes constantly during market hours, so the price you see may not be the price you pay if you wait.

Placing your first stock order

To buy a stock, find it in Fidelity's platform and click the "Trade" or "Buy" button. You'll see a form asking how many shares you want and what type of order you want to place. This is where you make a real choice about how your purchase works.

A market order buys the stock at whatever the current market price is, right now. If you place a market order for Apple at 9:30 a.m. when the market opens, you'll get shares at the opening price—you don't control that price. Market orders fill almost instantly during trading hours. This is the simplest choice for most people buying individual stocks for the first time.

A limit order lets you set a maximum price you're willing to pay. If you think Apple is worth $150 but not $155, you can place a limit order to buy at $150. The order sits in the system and only fills if the price drops to $150 or lower. Limit orders can take hours, days, or never fill at all if the price never reaches your limit. They give you control over price but no may provide you'll get the shares.

After you choose your order type and number of shares, review the total cost and click to confirm. Your order goes to the market immediately.

Understanding settlement and when you own the shares

When your order fills, you own the shares, but they don't officially settle for two business days. This is called the settlement period, and it's a standard rule for all stock trades in the United States, not something Fidelity created. During those two days, the money leaves your bank account and the shares are transferred to your name in the system.

You can see your shares in your Fidelity account immediately after the order fills—they'll show up in your holdings with a label showing they're unsettled. You can sell them before settlement if you want, though most people just wait. After two business days, the settlement completes and the shares are fully yours with no restrictions.

If you place an order on a Friday, settlement happens on Tuesday (skipping the weekend). If you place an order after 4 p.m. Eastern time on a weekday, it's treated as an order for the next trading day.

Costs and fees you should know about

Fidelity charges no commission when you buy or sell stocks. This is true for all U.S. stocks, ETFs, and most mutual funds. You pay only the price of the stock itself.

Some stocks trade with a bid-ask spread, which is the difference between what buyers are willing to pay and what sellers are asking. When you place a market order, you pay the asking price (the higher one). This spread is not a Fidelity fee—it's built into the stock market itself. For popular stocks like Apple or Microsoft, the spread is usually just a few cents. For less-traded stocks, it can be larger.

If you hold the stock in a taxable account (not a retirement account), you'll owe capital gains tax when you sell it for a profit. Fidelity will report this to you and to the IRS, but you're responsible for paying the tax. This is not a fee Fidelity charges; it's a tax you owe to the government.

Selling your stock when you're ready

To sell stock you own, find it in your holdings, click "Sell," and follow the same process as buying. You choose how many shares to sell, whether to use a market or limit order, and review the total before confirming.

When you sell, the money goes into your Fidelity account and settles in two business days. After settlement, you can transfer the money back to your bank account, leave it in Fidelity to buy other stocks, or move it to a money market fund that pays interest while you decide what to do next.

Keep track of what you paid for each stock and what you sold it for. Fidelity tracks this information and will send you a tax report at the end of the year, but you should understand your own gains and losses so you're not surprised by your tax bill.

Common mistakes to avoid when buying stock

Don't confuse a stock's price with its value. A stock trading at $20 is not automatically cheaper or better than one trading at $200. The price depends on how many shares the company has issued. What matters is whether the company is worth what you're paying, which requires research beyond just looking at the price.

Don't put all your money into one stock. Even experienced investors spread their money across many companies and types of investments to reduce risk. If you're new to stock buying, consider starting with an index fund or ETF that owns hundreds of stocks at once, rather than picking individual companies.

Don't panic sell when the price drops. Stock prices move up and down every day. If you bought a stock because you believed in the company, a temporary price drop is not a reason to sell immediately. Selling after a drop locks in your loss. Holding through ups and downs is how most long-term investors build wealth.

Don't use money you'll need soon. Stock prices can fall, and you might be forced to sell at a loss if you need the cash. Only invest money you can afford to leave alone for at least a few years.

Frequently Asked Questions

Can I buy stock during after-hours trading?

Fidelity allows after-hours trading from 7 a.m. to 8 p.m. Eastern time, but most individual investors should stick to regular market hours (9:30 a.m. to 4 p.m. Eastern). After-hours trading has wider bid-ask spreads, fewer buyers and sellers, and more unpredictable prices. Your order may not fill at all.

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

Fidelity has no minimum deposit to open an account. You can open an account with $1 and buy fractional shares (a portion of a share) if a stock's full price is too high. This means you can buy $100 worth of a $500 stock without waiting to save more money.

Do I need to pay taxes on stock I buy but haven't sold yet?

No. You only owe capital gains tax when you sell the stock for a profit. While you hold it, there's no tax, even if the price goes up. If the stock pays dividends (cash payments to shareholders), you may owe tax on those dividends depending on your account type and income.

What happens if I place an order but change my mind before it fills?

If your order hasn't filled yet, you can cancel it in your Fidelity account. Once it fills, you own the shares and can't undo the purchase—you'd have to sell them instead. Market orders usually fill within seconds, so canceling is only realistic for limit orders that haven't reached your price yet.

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

Yes. Fidelity offers automatic investment plans where you can set up recurring purchases of a specific stock or fund on a schedule you choose. This is called dollar-cost averaging and can reduce the impact of price swings over time.