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If you want to learn how to buy Bank of America stock, you’re in the right place. This article takes our guide on how to buy stocks and tailors it specifically to Bank of America stock.
Here are the steps to take, in order from first to last:
Set up a Brokerage Account To Buy Bank of America Stock
The term “broker” or “brokerage account” can be confusing to understand at first for many people.
We’re going to keep it simple and help explain it by using an analogy.
When you have money, there are different types of accounts where you can put your money.
If you want to put your money in an account where you can easily access it and write checks or withdraw cash from an ATM, then you typically set up a bank account.
If, on the other hand, you want to put your money in an account that allows you to buy stocks like Bank of America, then you need a brokerage account. It might seem like a foreign term if you’re a beginner, but it’s just the terminology used to describe an account that can buy and sell shares of stock.
There are many brokerage accounts out there that are free to set up. You can choose one from our list of the best stock trading platforms.
We like Tradier. They’re a brokerage that makes it simple to buy Bank of America stock online. We’ll feature Tradier in our tutorial in this guide.
Setting up a brokerage account involves more than just a click or two. It may take some time to go through all the forms, but at least it’s just a one-time deal to complete them.
Put Money in Your New Brokerage Account
After you set up the brokerage account, it’s time to put money in it. You can’t buy Bank of America stock if you don’t have money in the account.
Most brokerages will clarify how to put money in the account right after you open it. Most times, it involves connecting your bank account with your brokerage account to transfer money between them electronically.
It’s worth noting that typically when you make your first deposit into a new brokerage account, it takes about a week for them to let you use that money. So don’t expect that you’ll be able to instantly buy Bank of America stock shares after making the deposit.
Buy Bank of America Stock Using Your Brokerage Account
You’re ready to buy Bank of America stock now that your brokerage account has money. Here is a step-by-step guide on how to buy shares of Bank of America stock using screenshots from the Tradier brokerage account.
First, you need to pull up a ticker symbol for the underlying stock. In Tradier’s platform (which they call Dash), that is done through the Dashboard page as shown here:
The Ticker Symbol for Bank of America is BAC
Then type in the ticker symbol of the stock you want to buy. For Bank of America, the ticker symbol is BAC.
In Tradier, after you type in BAC, it brings up a page that looks like this:
As you can see, it shows all the core information about BAC stock there, including the current price.
From here, to buy shares of stock for Bank of America, you need to click the green button at the top that says “Trade.”
Doing that takes you to a page that looks like this:
That is where you can enter the details for your Bank of America stock trade. These fields are already auto-populated:
- BAC (in the Symbol field)
- Equity (refers to stocks, as opposed to options or other assets)
- Buy (as opposed to Sell)
The remaining fields need some explanation:
There is an empty Quantity field. That’s where you enter the number of shares of Bank of America stock you want to buy.
You can see at the top right of the above screenshot that the prevailing price of BAC stock was $35.23. So, each share you buy will cost approximately the amount shown there.
The two usual choices here are either Market or Limit.
To explain those, we need to talk about the mechanics of prices in the stock market. For any given asset, there are buyers and sellers.
When someone wants to buy a stock, the price they are willing to pay is referred to as a bid. When someone wants to sell, it’s an offer (or ask).
A transaction occurs when the bid criterion for a buyer matches the ask criterion for a seller.
You can see the highest bid and the lowest ask price for a stock at any given time. These are respectively referred to as “the bid” and “the ask.”
You’ll typically see some distance between the bid and the ask. If the bid and the ask were the same, that would have already resulted in a transaction. Any open orders will not have overlapping bid and ask prices.
If you look again at the screenshot above, you’ll see the bid and the ask indicated there for Bank of America stock. It shows a bid of $35.20 and an ask of $35.23.
That means the highest bidder out there is willing to pay $35.20 And the lowest seller out there is willing to sell for $35.23.
Now let’s look at the two order types: market and limit.
If you submit an order to buy Bank of America stock using a market order, it will match you up with the nearest seller. You don’t indicate a numeric price since “market” means you’ll pay the market price for Bank of America stock. In this case, you would likely pay $35.23 for your shares.
If you buy Bank of America stock using a limit order, you indicate the exact price you are willing to pay. Your order will only get filled if you get that price or lower.
There are tradeoffs with each order type.
With a market order, you ensure you get into Bank of America stock position quickly, but you might make a sacrifice on the price since you’re automatically paying the ask price.
With a limit order, you can try to get a lower price (maybe a price between the bid and ask), but you risk missing the buying opportunity if your order isn’t filled. So limit orders offer less certainty of fulfillment than market orders do.
There is no perfect order type for your Bank of America stock purchase. Ultimately you have to decide for yourself which tradeoffs you prefer.
Time In Force
That is the last field on the Tradier order entry page. You have two choices here:
- Day – Your order will only be active until the current day’s trading session ends.
- GTC – This stands for Good Til Canceled, which means your order will be active until you cancel it.
Once you’ve entered all your preferences, you can click the purple Submit button to submit your order.
The broker will fill your order immediately if you use a market order. If you use a limit order, it may not be filled right away. That’s where your Time In Force choice makes a difference. It affects how long your Bank of America stock order stays open.
Those are the steps to take in order to buy Bank of America stock. You need to have a brokerage account ready and open. Then you need to get to the ordering screen, type in the ticker symbol for Bank of America (BAC), and make sure the settings are configured to buy the stock at the price you want.
FAQs About Buying Bank of America Stock
Here are some FAQs we’ve heard before about buying Bank of America stock shares:
What Is Bank of America Stock?
Bank of America is a public company. That means that there are no individuals who privately own Bank of America. So it’s not just some guy or gal who single-handedly owns the entire company.
Most small businesses are private companies, and there is a single owner. But for huge companies, many of them are public companies. And for them, the company is owned by the general public.
For companies like Bank of America, anyone can pay to own a piece of the company. A share of stock represents one share of ownership in a public company like Bank of America.
So if you buy a share of Bank of America stock, you are purchasing one share of an ownership stake in Bank of America.
Can I Make Money From Buying Bank of America Stock?
It’s certainly possible, although there is no guarantee that you will make money from buying Bank of America stock. There is risk involved any time you invest in the stock market.
You can check out our guides on how to make money in the stock market and the best stock picking services in order to improve your odds of profitability.
What Does Bank of America Do?
As per Bank of America’s website:
“Bank of America Corporation, through its subsidiaries, provides banking and financial products and services for individual consumers, small and middle-market businesses, institutional investors, large corporations, and governments worldwide. Its Consumer Banking segment offers traditional and money market savings accounts, certificates of deposit and IRAs, noninterest-and interest-bearing checking accounts, and investment accounts and products; and credit and debit cards, residential mortgages, and home equity loans, as well as direct and indirect loans, such as automotive, recreational vehicle, and consumer personal loans.”
When Was Bank of America Started?
Bank of America was incorporated in 1784.
Where Is Bank of America Located?
Bank of America is headquartered in Charlotte, North Carolina.
What Is The Exchange Where Bank of America Stock Is Traded?
Bank of America stock is traded on the NYSE exchange.
What Sector Is Bank of America In?
Bank of America is in the Financial Services sector.
What Industry Is Bank of America In?
Bank of America is in the Banks-Diversified industry.