How to Trade the US Stock Market Online
Did you know that the two largest stock markets in the world are both in the United States? Both the New York Stock Exchange and the Nasdaq Stock Exchange stock markets are US stock markets and are home to the world's most recognised companies such as Apple, Amazon and Tesla.
In this article, you will learn how to trade the US stock market, including how to trade US stocks and indices, the time the stock market opens and how to access state of the art analytical tools to aid in your decision making.
Table of Contents
Are you interested in learning how to trade on the US stock market? If so, you're in 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 understanding what it is.
| The US stock market is essentially an auction place where investors buy and sell shares of publicly listed companies. |
A stock market is controlled and regulated by a stock exchange. But what is the US stock market called?
The US stock market is run by two of the world's largest stock exchanges - the New York Stock Exchange and the Nasdaq Stock Exchange. They help to facilitate all the buying and selling of shares in publicly listed companies like Amazon, McDonald's, Nike, Wal-Mart and more.
The total value of the US stock market fluctuates every day depending on how much buying and selling is happening. According to the Intercontinental Exchange, which bought the New York Stock Exchange in 2013, the total value of the US stock market in the New York Stock Exchange on 31 January 2018 was over $30 trillion.
This has been calculated by using US stock market data from all of the thousands of companies listed on the exchange.
What is a US stock market index?
If you want to learn how to trade on the US stock market, another common term to know is 'index'. As there is a wide variety of companies from different types of sectors listed in the US stock market, the exchanges created a selection of US stock market indexes to help economists, fund managers, journalists, traders and investors measure a section of the stock market.
For example, the following US indices are the three largest and most-recognised US stock market indexes in the US stock market and each has a specific focus:
- The S&P 500 Stock Market Index. This index measures the value of the largest 500 listed companies on the New York Stock Exchange and is considered as the best representation of the overall US stock market.
- The Nasdaq 100 Stock Market Index. This index measures the value of the largest 100 listed companies on the Nasdaq Stock Exchange. While this index includes companies from various industries - albeit mainly technology-related companies - it does not include financial industry companies like commercial or investment banks. The index is considered as the best representation of the US technology sector.
- The Dow Jones 30 Stock Market Index. This index was developed to track the US stock market performance in 1896 when individual company information was limited. The aim of the 30 stocks listed in the index is to reflect the dominant sectors that help the American economy.
This is why there are a variety of companies from all different sectors included in it. Over time some companies drop out and others are promoted. As of mid-2019 some of the Dow Jones 30 companies include American Express, Apple, Boeing, Coca-Cola, Disney, Goldman Sachs, McDonald's, Microsoft, Nike, Verizon and more.
Now let's look at how to trade the US stock market, how to access US stock market data to trade on and why using a US stock market chart could prove to be very useful in helping to make your trading decisions.
Did you know that you can trade on US stock market indexes, as well as on companies such as Apple, Tesla and Netflix all from one trading platform?
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How to trade the US stock market online
If you want to learn how to trade on the US stock market or, more specifically, how to buy US stocks, the first thing is to know the trading tools you need to start:
1. Use a broker - How to buy US Stocks
If you want to trade in the US market and buy shares in a particular company, such as Facebook, you need to find someone who not only owns some Facebook shares but is also willing to sell them to you. This is what your broker does for you.
Through your broker's trading platform they route your buy and sell orders to other buyers and sellers through their connection with the stock exchange that lists the shares of the company you are trading. This is a fundamental step in learning how to trade in the US stock market.
With the right broker you can buy and sell US stocks on a US stock market in seconds without meeting the person on the other side of your trade. A broker will also hold your capital to trade or invest with so it's important to choose the right broker when learning how to buy US stocks.
Finding one that offers the highest regulation, security and safety will be very important to your experience in buying US shares on the US market from the UK or any other location in the world.
For example, investment firms operating under the Admiral Markets trademark offer the highest regulation from the UK's Financial Conduct Authority, the Cyprus Securities and Exchange Commission and the Jordan Securities Commission, among others.
Not only that, but those who choose to use the Admiral Markets' fast, secure and free trading platform also benefit from a negative balance protection policy which will protect you from adverse movements in the market when you are buying US shares from the UK (or any other location in the world). It also gives you the ability to:
- Open multiple types of trading and investing accounts such as the Invest.MT5 where you can buy shares in companies from 15 global stock exchanges and receive free free-time market data on the US stock market.
- Open a CFD (Contract for Difference) trading account to long and short a market to potentially profit from rising and falling markets, as well as access leverage.
- Access the fastest and most secure trading platform in the world, MetaTrader, for Web, Windows, Mac, iOS and Android operating systems.
- Trade on multiple asset classes such as US stocks, international stocks, indices, commodities, currencies and cryptocurrencies.
Did you know you can access all of these features and test drive Admiral Markets as a broker by opening a FREE demo trading account? This allows you to trade in a risk-free environment until you are ready for a live trading account.
2. Use the best trading platform - How to access US stock market data
Your trading and charting platform will help you access important information you need to trade the US stock market. This includes US stock market news, US stock market charts and US stocks prices of different publicly listed companies.
With the advent of advanced trading technology, you can now have your charting platform and brokerage platform all in one place with the Admiral Markets MetaTrader suite of products. This means you can also access your order tickets when viewing US stock market graphs and general US stock market data.
Admiral Markets offer the following MetaTrader trading platforms:
- MetaTrader Supreme Edition (A custom plugin for MetaTrader 4 and MetaTrader 5, created by Admiral Markets and professional trading experts)
Through the above platforms, you can trade across the US stock market, as well as a variety of other markets, such as US stock market futures and indexes, commodities, foreign exchange and other international shares.
3. Create a routine - How to trade US stock market hours
Let's look at the US stock market hours. What time does the US stock market open and what time does the US stock market close?
Creating a routine of when you will analyse the US stock market can help in making high quality trading decisions. This is because if you know when you will be trading you can bring a high level of focus to it. The first step is to know the US stock market hours you can trade in.
What time does the US stock market open? What time does the US stock market close?
The US stock markets are located in New York with the New York Stock Exchange in Wall Street and the Nasdaq Stock Exchange in Times Square. Both open at 9.30 am and close at 4.00 pm New York time (Eastern time) Monday to Friday.
What time does the US stock market open UK time?
If you are from the UK and you want to invest in the US stock market from the UK, you want to know what time the US stock market opens UK time. The US stock market open time in the UK will be from 2.30 pm to 9.00 pm (UK time).
If you want to invest in the US stock market from the UK, there are several public holidays to be aware of during the year when it's closed. Using the Admiral Markets Economic Calendar can help you stay up to date.
What time does the US stock market open Indian time?
The US stock market timings as per Indian time (GMT+5:30) are 9 hours and 30 minutes ahead of New York time (Eastern time). So, if you want to invest in the US stock market from India, the US stock market opening times will be from 7.30pm to 1.30 am India time (GMT +5:30).
It's now time to discuss the most exciting step in learning how to invest in the US stock market - buying stocks.
How to buy US stocks?
The next step in learning how to trade the US stock market is to finally purchase some stock from the US stock market.
Once you've opened your live, or demo trading account, downloaded your free trading platform and found the right routine for yourself you can then start to make trading decisions to trade on the US stock market future and what shares to buy or sell.
This is where you really start learning how to trade on the US stock market. Now you're probably wondering how to buy US stocks in your MetaTrader trading platform? It couldn't be simpler, using the following steps:
- Open MetaTrader.
- Open the Market Watch section from the View menu at the top or by pressing Ctrl+M on your keyboard. This will open up a list of market symbols on the left side of your chart.
- Right-click on the Market Watch window and select Symbols or press Ctrl+U on your keyboard.
- This will then open the window shown below which details all the markets available for you to trade on.
Disclaimer: Charts for financial instruments in this article are for illustrative purposes and does not constitute trading advice or a solicitation to buy or sell any financial instrument provided by Admiral Markets (CFDs, ETFs, Shares). Past performance is not necessarily an indication of future performance.
Now you can left-click on one of the symbols you would like to view and drag it on to the chart to view US stocks prices of the symbol you've chosen. From here you can now open up a trading ticket:
- Right-click on the chart.
- Select Trading.
- Select New Order, or press F9 on your keyboard.
- A trading ticket will open for you to input your entry price, stop loss and take profit levels and unit size (volume).
Disclaimer: Charts for financial instruments in this article are for illustrative purposes and does not constitute trading advice or a solicitation to buy or sell any financial instrument provided by Admiral Markets (CFDs, ETFs, Shares). Past performance is not necessarily an indication of future performance.
How to Trade on the US Stock Market from the UK
For those who want to learn how to trade on the US stock market, the good news is that there are no barriers to trading based on your location, except for those who don't have easy access to the internet or the devices you need to trade.
Because trading and investing is available online via trading platforms like MetaTrader 4 and MetaTrader 5, if you want to invest in the US stock market from the UK, just follow the steps outlined above.
That's it! They are the same for you as they are for anyone in any other location around the world.
To learn more on how to trade in the US stock market and how to invest in the US stock market from the UK (or anywhere else in the world), open your free Admiral MetaTrader platform and watch the video below on how to trade on it!
Now you know the basics regarding how to buy US stocks and how to trade on the US stock market, the next step is to understand what affects US stocks prices so you can identify US stocks on an exchange that offer the best price movements for you to trade on.
What affects US stock market prices?
There are a variety of factors that affect the prices of US stocks on US stock markets, such as:
1. The Economy
Stock markets in the USA (and elsewhere) generally move higher during periods of economic growth as this environment usually means higher employment, more consumer spending and more profits for companies. If companies begin to make more profits investors tend to buy more stocks of those companies which, in turn, helps to push up the overall stock market.
Therefore, investors pay close attention to economic data such as:
- Employment numbers.
- Central bank policy on interest rates.
- Inflation reports.
- Retail sales and consumer spending figures and more.
When learning how to trade on the US stock market, keep in mind that investors look for a trend among several different economic indicators rather than react on just one good or bad economic data point.
For example, if unemployment starts to rise and retail sales numbers start to fall it could translate into lower spending which could affect company profits. This may cause some investors to exit some investments and reallocate their funds elsewhere, thereby affecting the overall stock market direction.
2. Politics
Another important point to consider when learning the US stock market for beginners is the impact of politics on markets. Some traders refer to news that affects the market as US stock market news (or English stock market news, etc.).
As the US government set tax policies and control overall spending and immigration, politics can have a big impact on trading on the US stock market and how you might invest in the US stock market. The effect of politics on the stock market in USA (and elsewhere) is seen during election season where presidential candidates sell their policies to big businesses and consumers.
During these periods big stock market news is released to the public, influencing how people trade on the US stock market. Politics also affect government policies and the decisions from central banks regarding interest rate policy which can have a big impact on corporate companies. This is because they are linked to borrowing costs which can impact corporate profit margins.
Source: Admiral Markets MetaTrader 5, NQ100, Monthly - Data range: from 1 Jan 2006 to 18 Feb 2022. Accessed on 18 Feb 2022. Please note: Past performance is not a reliable indicator of future results.
In the long term chart of the Nasdaq 100 index shown above, it is clear to see the long term trend that has unfolded since the 2008 financial recession. The trend higher was accelerated during the pandemic period as governments and central banks used policies to provide liquidity to the stock market which in turn helped it to surge to new record highs.
However, political events at the start of 2022, such as the Russia-Ukraine conflict and the Federal Reserve increasing interest rates, led to a significant decline in the index to roughly the same degree as the decline during the pandemic. Such events affect the way traders invest in the US stock market from the UK (and elsewhere). For some investors, it can be challenging to trade in such volatile times.
This is why it's important to have access to the right trading products. For example, Admiral Markets offers CFD (Contract for Difference) trading accounts, which allow traders to potentially profit from rising and falling markets by 'shorting stocks'.
This is an interesting way to invest in the US stock market from the UK.
This is because CFDs offer leverage, which can multiply the size of your potential profits, but also your losses. If you are interested in learning more about CFDs and how to trade the US stock market with them, you can have a look at this full, detailed article with everything you need to know about them:
But, during good economic times when the US stock market is rising, many traders are buying US shares from the UK (and elsewhere) and holding them for a longer period of time. One benefit - on top of a potentially rising share price - is receiving a regular piece of the company profits via dividends.
Admiral Markets offer both types of trading and investing accounts, giving both traders and investors the flexibility to trade on the US stock market during different market conditions.
How to trade on the US stock market with Admiral Markets
If you are also thinking of taking a long-term view of trading on the US stock market and would like to invest in the US stock market from the UK (or elsewhere) or in public companies from around the world, you may consider the Invest.MT5 account, where you can enjoy benefits such as:
- The ability to invest in thousands of stocks and ETFs from 15 of the largest stock exchanges in the world.
- Open an account with just €1 minimum deposit and invest from just $0.02 per share with minimum transaction fees of just $1 on US stocks.
- Receive free real-time market data, with no delays, at no extra cost.
- Create a stream of passive income by collecting dividend payouts.
- Use the world-renowned MetaTrader 5 multi-asset class trading platform.
- Use the app on mobile devices (your personal American stock market app for trading)
You can get started trading on the US stock market right now by clicking the banner below and enjoying all of the features above and more!
About Admiral Markets
Admiral Markets is a multi-award winning, globally regulated Forex and CFD broker, offering trading on over 8,000 financial instruments via the world's most popular trading platforms: MetaTrader 4 and MetaTrader 5. Start trading today!
This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or recommendation for any transactions in financial instruments. Please note that such trading analysis is not a reliable indicator for any current or future performance, as circumstances may change over time. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks.
