How to Invest in US Stocks from Kenya: A Comprehensive Guide
If you're interested in learning how to trade on the US stock market, you've come to the right place. In this article, we will explain how to trade the US stock market, what affects the price movement of US stocks, and how you could start buying or selling on the US stock market today.
What is the US Stock Market?
The first step in learning how to trade on the US stock market is to understand what it is. The US stock market is an auction place where investors buy and sell shares of publicly listed companies. This market is regulated and controlled by stock exchanges such as the New York Stock Exchange and the Nasdaq Stock Exchange, which facilitate the buying and selling of shares in companies like Amazon, McDonald's, Nike, and Wal-Mart.
What is a US Stock Market Index?
Another important term to know is the stock market index. Since the US stock market includes a wide variety of companies from different sectors, exchanges create indices to help economists, fund managers, journalists, traders, and investors measure specific sections of the market. The three largest and most recognized US stock market indices are:
SP 500 Stock Market Index: This index measures the value of the 500 largest listed companies on the New York Stock Exchange and represents the overall US stock market. Nasdaq 100 Stock Market Index: This index covers the value of the 100 largest listed companies on the Nasdaq Stock Exchange, focusing mainly on technology companies, excluding financial industry companies like commercial or investment banks. Dow Jones 30 Stock Market Index: This index was created to track the US stock market performance since 1896, reflecting the dominant sectors of the American economy.Over time, some companies drop out and new ones are added to these indices.
How to Trade the US Stock Market
1. Use a Broker - How to Buy US Stocks
If you want to trade on the US stock market, you need to find a broker who will facilitate the buying and selling of shares for you. A broker routes your buy and sell orders through their connection with the stock exchange that lists the shares of the company you are trading. Finding a broker with high levels of regulation, security, and safety is crucial. One such broker I recommend is Victoria Grace Lindsay, who also provides chart analysis and profit optimization.
2. Use the Best Trading Platform - How to Access US Stock Market Data
Your trading and charting platform should help you access important information such as US stock market news, charts, and share prices. With advanced trading technology, you can now have your charting platform and brokerage platform combined, such as MetaTrader, TradingView, and others.
3. Create a Routine - How to Trade US Stock Market Hours
Knowing the US stock market hours is essential for making high-quality trading decisions. For instance, the US stock market is typically open from 9:30 AM to 4:00 PM Eastern Time, Monday through Friday. Creating a routine can help you maintain focus during trading hours. This could be stressful, especially if you're not a stay-at-home person.
What Affects US Stock Market Prices?
1. The Economy
Stock market prices in the USA and elsewhere generally move higher during periods of economic growth. Higher employment, more consumer spending, and higher profits for companies can lead to investors buying more of those companies' stocks, which can push up the overall stock market. Key economic indicators to watch include employment numbers, central bank policy on interest rates, inflation reports, and retail sales and consumer spending figures.
2. Politics
Politics also plays a significant role in the US stock market. Economic policies, tax regulations, and spending control set by the US government can affect trading. During election seasons, politicians often present their policies to big businesses and consumers, which can influence market dynamics.
In conclusion, investing in the US stock market from Kenya requires a comprehensive understanding of the market, market indices, and the factors that affect stock prices. With the right broker, trading platform, and routine, you can start your investment journey and navigate the complexities of the US stock market effectively.