How to Trade Stocks Ireland – Guide to Stock Trading

Interest in online stock trading has boomed in the past year. If you want to learn how to capitalise on this growing trend then this guide is for you. 

With the best stock market trading apps and share trading platforms, you can trade stocks in thousands of publicly listed companies like Apple or Tesla at the click of a button. 

In this ‘How to Trade Stocks Ireland’ guide, we cover how you can start stock trading in just a few simple steps, what successful stock trading entails and how to trade shares online 100% commission-free. 

What is Stock Trading?

A stock represents a small piece of ownership of a publicly-traded company. When stock trading you are buying and selling stocks of these companies. Stock traders do this to try and profit from the movement in the company’s share price. 

Stock trading is not to be confused with stock investing. While stock investors will buy stocks in a company to hold for the long-term, stock traders will buy stocks to hold for the short-term. 

When it comes to stock investing, the investor may only make a few investments a year and hold them for several years to achieve capital growth. In stock trading, traders are likely to make several trades a month or a week to achieve short-term profits on a more regular basis. 

Real Stocks vs Stock CFD Trading

Over the past few years, there has been a huge leap in the type of financial products offered to retail stock traders. While traditionally, stock traders would only make money if a stock goes up, new products such as CFDs (Contracts for Difference) allow traders to profit from rising AND falling stock prices. 

Real Stocks 

The traditional method of stock trading is to buy real stocks. These stocks represent a small piece of ownership of a company. 

When buying real stocks you can only make a profit if the stock price moves higher and you exit at a higher price. If the stock price drops then your investment will be in a losing position. 

Stock CFDs

CFDs are known as derivative products. They track the underlying price of a security. When trading CFDs you are merely speculating on the price direction of the security rather than owning it. 

With CFDs, you are entering into a contract with a counterparty (typically your broker) to exchange the difference in value between where you buy and where you sell. 

This product allows you to speculate on rising and falling markets. You can also leverage your position too.

Real Stocks vs CFD Stocks

To see the differences between real stocks and CFD stocks, see the comparison table below.  

Trading vs Investing in Stocks

When stock trading in Ireland you have two different options – trade or invest. Traditionally, investors would invest in stocks and hold them for the long term. But nowadays there are more and more investors who are trading stocks on a much shorter-term basis. 

Stock trading apps have made short-term stock trading accessible and simple to perform. This is why there is currently an online stock market trading boom happening around the world. 

However, it can be challenging for individuals to invest for the long term and trade for the short term. The mindset required to hold trades for the long term and hold trades for the short is very different so try to stick to one style. 

Penny Stock Trading 

Penny stocks have become increasingly popular over the past few years due to their huge potential moves. A penny stock is defined as a stock trading less than 5 USD on US stock market exchanges, 1 EUR on European stock exchanges and 1 GBP on the UK stock exchange. 

These are small companies with a low market cap. But as they are publicly traded companies their focus is to grow. This is why penny stocks can often exhibit large price swings; the transition from a small company to a large one. 

Penny stock trading has become popular because traders enjoy the short term, volatile price swings these types of stocks provide. 

Best Stocks to Trade Today

If you are looking for the best stocks to trade today then read about the top five below.

1. Tesla – Join the Electric Vehicle Revolution

Governments around the world are starting to take climate change much more seriously and are encouraging the use of electric vehicles. As Tesla is the world’s leader in electric vehicles the long term prospects for the stock are very interesting. 

Tesla’s stock price has risen more than 150% this year alone, helping the company to surpass a $1.2 trillion market capitalisation. Even more significantly, the stock price surged passed the psychological barrier of $1,000 per share. Could $2,000 be on the horizon?

2. Apple – A Lifestyle/Tech Behemoth

Apple is a stock that needs no introduction. The company’s share price has been rocketing higher in recent years – particularly after the pandemic. This year, the stock price has performed well but has also lagged the market. 

Supply chain issues and a chip shortage affected how many products Apple could manufacture and sell. This caused growth investors to focus on other stocks. But, this weakness could represent an interesting buying opportunity as Apple’s share price hovers around $140 with plenty of upside potential. 

3. Nvidia – Bullet Proof Chip Maker

Nvidia is a chipmaker that is involved in cryptocurrency mining, gaming and autonomous vehicles. These are all very hot sectors for investors right now and is likely why Nvidia shares are more than 180% this year. 

The global chip shortage has helped lift Nvidia further as company’s pay more for what is currently available. However, even when supply normalises the demand for chips is likely to increase with Nvidia well-positioned to capitalise on another boom.  

4. MicroStrategy – Capitalise on the Bitcoin Boom

Bitcoin surged to record highs this year. US regulators approved the world’s first Bitcoin ETF. This proved to be the second most popular ETF in the world and has broken the record for the most invested ETF on the day of launching – ever!

As cryptocurrencies become more mainstream and Bitcoin rises, companies such as MicroStrategy are set to benefit. This is because the enterprise technology company has used its free cash flow to buy Bitcoins (114,042 of them) and plans to buy more.

5. Disney – A Sleeping Giant of Streaming

Disney is a media and entertainment giant with theme parks, movie studios, sports channels and now a streaming service to rival Netflix. Many analysts have been bullish about the Disney+ streaming service which holds major brands such as Marvel, Star Wars and Pixar. 

While the online streaming industry is becoming more competitive, Disney has a well-diversified cash flow business. This means it could weather any potential storm a lot better than other streaming providers, making it a stock to watch. 

Best Stock Trading Platforms Ireland

While there are many stock trading apps being released, only a handful will provide the necessary features to trade stocks safely and easily. When choosing a stock trading app look at how they are regulated, how easy the platform is to use and the fees that they charge. 

To save you time, we go through the top two stock trading apps right now. 

1. Capital.com – Top Rated CFD Stock Trading App

Capital.com also offers a simple to use, fast stock trading app. The broker offers the ability to trade on more than 3,800+ stocks, commodities, indices, currencies and cryptos using CFDs (Contracts for Difference). 

CFDs allow you to profit from rising and falling markets while using leverage. With Capital.com, you can open a position on a stock worth $5,000 but will only need $1,000 to do so. This will amplify both gains and losses. 

The Capital.com stock trading app is really simple to use. Beginners will be able to start trading almost instantly. You can also access a wide range of technical analysis tools on the web platform and mobile app. 

One of the best features about Capital.com is that you can trade 100% commission-free! There are also no fees for deposits or withdrawals and you can open an account with a low minimum deposit of just $20. 

Pros

• 100% commission-free stock trading!
• Zero fees for deposits and withdrawals
• Regulated by FCA, CySEC, ASIC
• Trade on 3,500+ stocks
• Low minimum deposit of $20
• Simple to use stock app

Cons

• Cannot trade real stocks, only CFDs

75.26% of retail investor accounts lose money when trading spread bets and/or CFDs with this provider.

Stock Trading Fees

The stock trading fees offered by your broker is hugely important. After all, you want them to be as low as possible so you can keep as much of the profit as possible. 

The spread is the difference between the buy price and sell price of a security and is a commission charged by nearly all brokers. Swap fees are overnight charges when using CFDs. There are no swap fees on real stocks. 

Stock Market Trading Hours 

Stock markets around the world are generally open around normal localised office hours. However, with access to global markets with stocks apps, you can trade 5 days a week and almost 24 hours a day. 

*There may be a change for a few weeks in the year when clocks adjust to daylight savings time. 

Stock Trading Tax in Ireland

If you sell your shares at a higher price than you bought them, you will have made a capital gain. In most countries, capital gains are taxed. In Ireland, the current capital gains tax (CGT) rate is 33%. 

If you make a 10,000 EUR profit on one of your stock trades, then you will have to pay 3,333 EUR in capital gains tax. 

Stock Trading Tips

If you want to learn how to trade stocks in Ireland successfully then be sure to follow these tips. 

1. Focus on Risk Management

Risk management is by far the most important element to focus on when stock trading. Some trades will lose, some trades will win. 

Keep your risk low to survive the down periods and to stay in the game long enough to succeed. 

2. Use Portfolio Diversification

Diversification is a very powerful tool when stock trading. It is the concept of not putting all your eggs in one basket. 

For example, instead of buying 10,000 EUR in just one stock consider buying 1,000 EUR in ten high-quality stocks across different sectors. 

This means if one stock doesn’t perform well, other stocks that are performing well can balance out your overall portfolio. 

3. Consider Stock Trading Courses Ireland

Education is the key to success. Consider stock trading courses in Ireland to help you learn how to play the game well. Focus on learning about the fundamentals of stock charting, how to build a solid investment strategy and how to use the best trading tools.

Frequently Asked Questions on How to Trade Stocks in Ireland