In order to trade any type of stock, a Broker is needed to link you to companies that have shares available to the public. However, there is an age limit as to who are allowed to open an account with brokers. Most states would require you to be at least 18 years old, while others would want you to be at least 21 years of age. This rule is the same for many other countries, not only the USA.
Luckily, being under the age limit does not automatically disqualify you from trading stocks. The markets do think of you when setting their rules if you are not yet legally aged for them.
Remember that brokers are running a business, if a law is working against them they will find a strategy to bypass that. adolescents may not be their primary target market, but they do target them some way or another.
How can an under-age person register with a stock broker?
Registering with a stock broker is very simple. They have the registration process on their websites where anyone who is legal can register at any time. If you are a minor your parents can open a custodial account for you, which would be under your parents’ name. Under the law, your parents would have total control of the account, however, they cannot withdraw any money from it.
When you turn 18, or the legal age depending on the state or country you are residing, your parents’ name will be taken off from the account. Your parents will have to fill out a transfer form which should be found on the broker’s site. This is when you will have total access to this account and manage it as you wish.
Does it worth it to start trading at a young age?
Honestly, it depends on the market. If you have a custodial account, it’s supposed to be managed by your parents. If you want to trade penny stocks this account would not be in your advantage because your parents have their own lives.
Trading penny stocks would require you to be very devoted, this is not something your parents would be able to do for you. But if you are going to trade the blue chip stocks, I would say go for it.
Do you want to trade on your own?
If you are looking to trade by yourself to have a feel as of how the market works, you would have to open a stock market game account.
Stock market game allows you to trade as it was the real market, but it is paper trading. How does it work? You open an account with any site that has it, then they would give you a couple thousand of paper dollars to trade.
The purpose of this game is to teach you how to trade stocks. It can be either penny stocks or the regular stocks. You can learn some good strategies from a stock market game, which you can use in the real world.
Stock market game is played by many people before they start trading the real stock. This is a way of practicing since you would not want to practice with your real money. Go ahead open an account with a stock market game site and start trading and learning.
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