If you are new to online investing, don't put your entire life savings into an online account. Start with a smaller sum, which will be easier to handle and keep track of. Once you feel confident, you can then decide to add more money to your online account. Once online, many investors tend to concentrate on stocks, specifically large-cap domestic stocks. Take into account your time horizon and risk tolerance to develop a well-balanced portfolio of stocks, bonds, and cash.
Most investors are in mutual funds for a good reason.
They don t have the expertise to make their own investments calls on individual stocks. They also are too preoccupied by work, family and other concerns to spend every minute watching the market. Even if online brokerage costs are lower than those of full-service brokers, they can still add up, particularly if you do a lot of buying and selling. Online brokerages firms also impose a number of other fees and charges that you should study closely. The federal capital gains tax is also something with which you must reckon.