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Selling Stocks - How Fast Can You Sell Stocks?

The choice of when to start can determine the success or failure of an entire investment. But not only the entry point should be chosen carefully, the time of sale should also be carefully considered. Those who sell too early can miss out on profits, those who hesitate too long may have to accept lost profits. Below we look at selling stocks and what you should be aware of as a shareholder.

Selling stocks - how does it work?

Shares can be sold through brokers - on the stock exchange or over the counter. Typically, a single sale of shares only takes a few minutes to complete. The sales proceeds will be credited to the billing account no later than the next banking day. However, there are a few things to consider.

In order to be able to sell shares, you first need to log into the depot. All securities in the portfolio are listed there - including the number of units, purchase price, name and ISIN (securities identification number, formerly WKN).

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Selling stocks how does it work? From login to the limit

In order to sell a share, the Order mask be opened. There you must first specify which number of which share is to be sold - e.g. B. 200 BMW preferred shares (BMW Vz.), ISIN DE0005190037.

The next step is the desired Stock exchange selected - e.g. B. Xetra. Most brokers show an overview of all available stock exchanges. It is generally advisable to choose the trading venue with the highest liquidity (daily turnover in the share to be sold).

Then a limit set. The limit ensures that the sale does not take place at a very unfavorable price due to an unfortunate coincidence, which is very unlikely with liquid shares such as the BMW preferred share, but is theoretically possible. If stocks are sold, the limit is set slightly below the current price. If the BMW preferred share is listed e.g. B. at € 75, a limit can be set at € 74.50.

Sell ​​shares or transfer custody account

In the last step, the order is authorized by entering a TAN and forwarded to the exchange. As a rule, the shares are sold on the same day, the proceeds are credited to the clearing account and the transaction is noted on the account statements. Income taxes incurred from price gains may be introduced directly by the broker.

In order to be able to sell shares, there does not have to be any liquidity on the clearing account, as the transaction fees and, if applicable, limit fees are covered by the sales proceeds. It is not necessary to sell shares because a custody account is to be opened with another broker - a Custody transfer be used.

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How long should stocks be held?

First of all, there is no general answer to this question. How long you should hold your securities depends on several factors. This includes, for example, your personal return expectations and the period in which you can spend the money you invested. If you want to make quick profits, look for securities that can be expected to rise significantly in the near future. This can be the case, for example, with young companies that bring a promising innovation onto the market.

Those who, on the other hand, are looking for bigger profits and can do without the invested money for longer, are well served with long-term shares. Anyone who has the opportunity to invest their own capital in the long term can cope with price fluctuations better than is the case with a short-term trader. A long-term investor usually only has to wait long enough for the next price increase and can even achieve a greater profit than with a quick sale.

Whichever investment horizon you choose, it is always important to have a good understanding of the market in which you intend to invest. Business magazines and news are good sources of information, as are reputable online finance portals. Also take a close look at the business figures of a company that interests you and study the historical price developments in detail.

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It is not easy to find the perfect time to sell, and if you want to sell stocks, you can never be completely sure that your decision is right. There is no guarantee of success in trading and even investors with years of experience are not always right with their trading decisions.

When to sell or hold stocks

ShouldAre you selling or holding stocks in the current situation? The always current crucial question for shareholders can never be answered across the board. There are, however, sensible recommendations for action with which the market situation and one's own willingness to take risks can be taken into account.

Sell ​​or hold stocks? Secure profits AND let them run!

Anyone who owns shares benefits not only from the profits that can be achieved through the increase in value, but usually also from the dividends that public companies regularly pay out to their shareholders.

When is the best time to sell stocks? A share should be sold if it no longer meets the expectations or the criteria of the strategy used. If a stock was bought because of its high dividend yield and after three years it still offers a higher dividend yield than the stocks of competitors, price gains alone are not a reason to sell the stock.

Many investors are afraid of losing their but not yet realized price gains by a setback of the share and therefore sell shares that are fundamentally in excellent condition in terms of the market. In this case a Stop loss or. Trailing Stop Loss represent an option. In this way, exchange rate losses are limited and future, further exchange rate gains are dynamically hedged.

When to sell stocks If they bring in losses or if there are better ones!

If, on the other hand, a share has performed poorly, it should be put to the test and, if necessary, sold. Many investors mourn the losses they have suffered and shy away from realizing them. This is self-deception because the losses have already been incurred without the sale.

Investors should sell stocks before the loss in a single position becomes too great - preferably by setting up a stop loss when buying. In addition, a sale is advisable if - technically or fundamentally - there are better stocks in which the liquidity that is freed up with the purchase can be invested.

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Does it make sense to sell a stock at a loss?

There is no general answer to this question either, and each case should be considered individually. First of all, the decision depends on whether you want to invest in the long term or in the short term. As we have already mentioned, long-term investments can make up for price losses if the shareholder waits long enough. Of course, the stock price can keep falling in the long run, but a trader with a shorter investment horizon is more quickly under pressure to make a decision.

It also depends on the amount of the losses and how much you are willing to accept. The expected future price development is also important. Read the forecasts of the trade experts, wait for the latest business figures or watch economic developments. With enough background, you can get a good idea of ​​whether a losing stock is worth holding or whether it would be better to sell it.

Are there any costs involved in selling shares?

Order fees

Anyone who wants to buy or sell stocks pays an order fee for each transaction. This is different depending on the broker or financial institution and it is worthwhile to carry out a broker comparison, because the individual cost items can sometimes differ significantly.

Withholding tax

The final withholding tax is an important point in connection with the sale of shares. Since 2009, a tax on investment income has been due in Germany. This also includes, for example, dividends or realized price gains. The tax rate is a flat rate of 25 percent and is withheld directly by most German brokers. If the broker is based abroad, the investor may have to take care of the taxation himself. An annual tax allowance of 801 euros per person applies to the withholding tax. For married people, there is an allowance of 1,602 euros.

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What order types are there when selling shares?

If you want to trade stocks, you should know the most important order types. There are numerous different order types for the sale of stocks alone, and below we want to show you the most popular ones.

Market order: Immediate execution of the sell order at the best possible price

A market order is executed immediately at the currently available price. This order type has the highest priority compared to other order types. Furthermore, a market order is always executed.

One of the disadvantages of a market order is the "slippage effect". It can happen that the actual selling price deviates from the expected price due to price jumps.

SeLL Limit Order: Execution of the sell order under certain conditions

If you want to sell at an advantageous price, place a sell limit order. You determine the minimum price at which you want to sell. If a certain price mark is reached or exceeded, the order is executed immediately. If the price moves below the limit, the order will not be executed. With a sell limit order, the sell order is only executed if certain conditions are met.

Stop order: secure profits, limit losses

With a stop order, a sell order is executed if the price develops negatively or if you want to secure profits that have already been made.

Place a stop below the current market price. Should the share price develop in the undesired direction, the stop order is automatically converted into a market order. The order is then executed at the next possible price, i.e. the share is sold immediately.

If you have identified a level of resistance at which the rising share price is very likely to reverse, you can also place a stop order at this point. That way, the stock will automatically be sold when the price hits the mark.

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