The old-school way: brokers and the stock market

01

You need a broker

Real shares are bought and sold through a broker: a firm licensed to hold customers' shares and cash and to send their orders to the market. In the United States brokers are registered with the SEC and are members of FINRA, the industry's regulator.

This is the opposite of a crypto wallet. In a wallet, you hold the key and nobody else can move what's yours. With a broker, the firm holds everything in an account in your name, and you tell it what to do.

02

Opening an account

A broker has to know who its customers are. To open an account it asks for your legal name, address, date of birth and a tax number, and checks them. That is the law, not the broker being nosy.

Money arrives by bank transfer, which can take a few days to clear, and leaves the same way.

03

Market hours

The US stock market is open on weekdays from 9:30 am to 4:00 pm New York time, and closed on weekends and market holidays. An order placed while it is closed waits for the next open.

Some brokers also trade a few hours before and after. Fewer people trade then, so prices can jump more.

04

Settlement

When you buy a share, the trade is agreed at once but the share and the money officially change hands one business day later. That is called settlement. It is why money from a sale isn't always free to withdraw the same day.

05

What protects the account

If a US broker fails, the Securities Investor Protection Corporation (SIPC) protects each customer's account up to $500,000, of which up to $250,000 can be cash. It protects against the broker failing. It does not protect against a share's price falling.

06

On Viru

Viru's wallet works the other way round: you hold your own coins, and no broker is involved. Viru is not a broker and holds no shares; Markets shows US stock prices on a watchlist.