How to Buy Stocks on Interactive Brokers:A Step-by-Step Tutorial

If you have followed our journey, you already understand what the stock market is and how stocks work.

Now it is time to put that knowledge into practice: access the market and understand how to execute your first order correctly.

What is a broker and what does it do when you buy stocks?

Its platform allows you to deposit funds, execute your orders and track the development of your portfolio.

How do you choose a broker for stock-market investing?

Criterion	Focus	Essential points
Security	Capital protection	Supervision by recognised financial authorities and protection of client assets according to the entity and jurisdiction.
Costs	Financial efficiency	Low buying and selling commissions and competitive exchange rates.
Access	Ability to invest	International markets, a clear interface and fractional shares.

Regulation, costs and market access must be assessed together. A broker may offer an appealing platform, but if its costs are high, its regulation is insufficient or it does not provide access to the markets you need, it is probably not the best choice for long-term investing.

Why do we use Interactive Brokers at Scale & Own?

At Scale & Own, we use Interactive Brokers (IBKR) because it brings together the main criteria we look for in a broker for long-term investing:

• Institutional strength: regulated in multiple jurisdictions by recognised financial authorities.
• Global access: more than 170 international markets from one platform.
• Competitive costs: low commissions per transaction and currency conversion at rates very close to the interbank market.
• Interest on cash: the possibility of earning interest on certain uninvested cash balances, depending on the currency, balance and current conditions.

How to buy a stock step by step on Interactive Brokers

The account-opening process takes place online and requires identity verification before you can begin trading.

Create the account

→

Verify your identity

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Fund the account

• Go to the official IBKR website and select Create Account > Individual Account.
• Enter your personal details and upload your identity document and proof of address.
• Once your account has been approved, make your first bank transfer.
• Important: include your IBKR account number, for example U1234567, in the payment reference so that the deposit is allocated correctly.

Practical note for international investors: Interactive Brokers does not accept every local currency for deposits. If this applies to you, you can convert your funds through your bank, use a suitable local solution or use Wise as an intermediary account.

Local currency

→

Bank, Wise or local solution

→

Conversion into USD

→

Interactive Brokers

Holding dollars can be particularly practical because many investments are denominated in USD. Always compare the options and costs available in your country.

Enter the company’s identifier in the search bar at the top of the Client Portal:

• Exact name: for example, Apple.
• Ticker, or symbol: for example, AAPL.
• ISIN code: for example, US0378331005.

The ticker or ISIN identifies an asset more precisely than searching only by name, avoiding confusion between similar companies. These identifiers will also appear in the stock-analysis tools we use in the next stages.

The same company can be listed on several markets. If you are starting out, it is normally preferable to select its primary market, which usually has greater liquidity. Also check that you are selecting Stock, not options or other derivatives.

Before continuing, confirm that you are viewing the correct listing by checking the company name, ticker, market and current price.

Select the Buy button to open the configuration panel. Before configuring the order, check that the asset, exchange and price correspond to the stock you want to buy. You will also see the Bid and Ask prices; the difference between them is known as the spread.

You will then define three essential parameters:

1. Quantity or amount

• By quantity, using whole shares: you define the exact number of shares, for example 15.
• By amount, in USD: you define the dollar amount to invest, for example USD 200. IBKR will buy the corresponding fraction if fractional-share trading is enabled.

2. Order type

Order type	How it works	When it may be useful
Limit	You set the maximum price you are willing to pay. The order can be executed only at that price or a lower one.	When you want to control the maximum price you are willing to pay.
Market	It is executed immediately at the best available price at that moment.	For highly liquid assets when you prioritise immediate execution.

3. Order duration

• Day: the order expires automatically at the close of the current trading session.
• GTC (Good-Til-Canceled): the order remains active until it is executed, you cancel it or it reaches the broker’s maximum time limit.

Educational notice: at this stage, you are learning how to execute an order, but we will still cover how to analyse a company and determine whether its price is suitable before investing. For now, you do not need to make any real purchase. If you want to practise the process, you can use IBKR’s simulated Paper Trading account without risking your capital.

Review the summary one last time: asset, quantity, order type and duration. Then select Submit Buy Order.

Go to Trade > Orders & Trades to check the status of your transaction:

• Pending: the order has been sent but is waiting for the market to open or for your limit price to be reached.
• Filled: the purchase has been completed.
• Cancelled: the order expired or was cancelled.

Once executed, the position will appear automatically in your portfolio. There, you can see the number of shares you own, their market value, your average purchase price, your unrealised gain or loss and the dividends you receive.

What should you remember before buying stocks?

• Fractions: enable fractional shares if you want to invest fixed amounts without having to buy a whole share.
• Trading hours: trade preferably during regular market hours, when liquidity is normally greater.
• Limit orders: use them when you want to control the maximum price you are willing to pay, bearing in mind that the order may not be executed.
• Currencies: if you invest in a currency different from the one in your account, pay attention to the exchange rate and conversion costs.

Your next step with Scale & Own

Now that you understand how the stock market works and how to execute an order, it is time to learn which companies to buy and why.

At Scale & Own, we will begin with a cash-flow-oriented strategy, whose objective is to generate recurring income from our investments. To do this, we will start with one of the most widely used assets for this purpose: stocks that pay dividends.

In the next stage, you will learn how dividends work, what to analyse before investing and how to identify quality companies capable of generating income sustainably.

Continue to Module 03 · How Dividends Work →

• What is a broker and which one do we use?
• How to buy a stock step by step
• What to remember before buying stocks
• What is your next step in the stock market?

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