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Your first steps on the stock market: DEGIRO Quick User Guide for beginners

In order to help you if you are new to either the stockmarket or DEGIRO I have written a small guide to help you get started. While its meant for beginners I believe it can also contain some good tips for the more advanced user.

In January 2020 I made the decision to move from Keytrade to DEGIRO as a broker. The low fees appealed to me. I noticed that its not yet clear to everyone how you can actually trade stocks / ETFs and funds on DEGIRO, so this entry guide will allow even the absolute beginner to start on the stock market.

disclaimer “Investing involves risks of losses”

DEGIRO Sign up process

The very first thing you will need to do is create an account (if you haven’t already). You can sign up for DEGIRO here. DEGIRO allows you to sign up from multiple countries. If your country is not in the list but you live in the EU then I suggest to pick a country where you speak the language. For example I live in Belgium and I signed up on the site of “Nederland”, and that works perfectly. Remember the account is 100% free. You only need to pay a small fee when you start to trade. I found that for the trading I do, DEGIRO is the cheapest stockbroker. I will explain this part further on.

Once you click on your country you will enter the sign up screen:

Click there on “Open a free account now”.

DEGIRO has a waiting list, the crisis has drawn a lot more people to the stockmarket. Don’t worry DEGIRO is processing the waiting list, but it can take some time for you to have an active account. Remember stock trading is for the long term, so don’t panic if it takes a while to sign up.

Once you filled in your details go to your mailbox to activate your account

In the email you just got click “Complete your registration” to activate the account

You then go to a page that says Email address verified

Click Login and type there the username and password that you entered before.

At this point you will know your place in the queue. At some point 30.000 people tried to sign up, so that means that 6431 is not a bad place.

Updating your profile

Once you are accepted, one of the first things you should do is to make sure all your personal information is correct.

To check that hover over the usericon at the lower left and click “Profile” (on the screenshot its in Dutch but its on the same location everywhere).

When you click there you come on your personal information page.

The first thing you need to update there is “Personal information” (Persoonlijke informatie on the screenshot).

In that Area you will be able to update your adress.

The second area that is important is the area just bellow that, where you can set your bank account. If you set your bank account then any amount of money that you write from your bank account to DEGIRO will be automatically added to your DEGIRO account. I noticed that this is a smooth process and takes only a few hours.

What I also highly recommend to do is to check out the “Security” Area. There you have the chance to set two-factor authentication.

Using two factor authentication is highly recommended. In this case you will need to download an app called “Sophos Authenticator” on your phone. You can just download this free app from the Apple store or Play store.

DEGIRO will present you with a QR code. Once installed just select scan QR code. This menu pops up if you click the three dots in the top right screen.

Then a camera will pop up and you just point it to the QR code that DEGIRO has supplied you.

From this point on you will see a DEGIRO icon on your app. That means that every time you login you will need to write whatever number is displayed there. That also means that only if a User has both access to your phone and your password they can access your account, making it impossible to hack your account from the outside since they would also need access to your phone to get in.

DEGIRO Pricing

Before starting with investing you might want to know how much it will actually cost you to invest.

First its good to know that the tariffs are very similar across the EU, with some minor differences. In the Netherlands I noticed they are slightly cheaper but the difference is quite small.

You can compare the fees with other brokers for Ireland here for example or for the Netherlands here. You can also find a cost calculator on that page if you want to know it exactly.

Generally I found the pricing of DEGIRO to be really competitive. Bellow is an example of the pricing in Ireland for stocks and ETFs (DEGIRO is at the left, you can see a comparison with some other brokers)

Stocks Pricing

For ETFs there is even a list of ETFs you can purchase once a month for free (conditions applicable, read those here). If you only invest small amounts like 25 EUR / month then this could be an option for you. You can find a list of all free ETFs here.

However keep in mind that they will come with a higher yearly cost. So make sure you check the yearly cost. There is a few on the list where the yearly cost is reasonable. One example would be the ISHARES MSCI WOR A, with only a 0.24% cost. Its a good ETF because you are covered worldwide which will lower your risk. Its also located in Amsterdam what should be good for Taxes. If you can invest higher amounts per month there is also ETFs that are not free that will be cheaper actually. In the next chapter I will suggest one. If you decide to buy an ETF with a purchasing fee, it could also be worth it to save up two months before purchasing.

I would advise against buying funds since they usually come with very high yearly costs up to 3%! This will be a big cut in your profit. I would also stay away from more futuristic investments such as options or the futures market. The majority of the people do not make a profit there.

Your first purchase on DEGIRO

Transferring money

Transfering money is quite simple. You just need to transfer from the bank account you coupled to your DEGIRO account in the last chapter.

At the top right you normally see an icon to book money in and out.

When you click on that you should see the option to transfer money manually. This is the option you should use.

When you click on it you will get the bank details of the account you need to write to.

I suggest you first try with a small amount (1 EUR) and test that it works. Once it works you can transfer a larger amount. Remember you can only transfer money from the account you have added in DEGIRO.

On the same screen you have the option to book money back to your bank account, should you need it in the future. It can be interesting to also test this option and write the 1 EUR back to your bank account.

Get the right information on the ETF you are interested in

If you already have a stock or ETF in mind then I suggest to search for that stock. If you haven’t then go to the search box and enter SPDR MSCI WORLD UCITS. This is an ETF that invests in the top stocks in the top developed countries. I will show you how to get this information from the ETF itself.

When you search for this ETF you will get two results. One is in USD and the other in EUR. Lets choose the one in EUR so we do not expose ourselves to a currency risk.

Once you click on the ETF you will end up on the overview page of the ETF. If you like to see how the ETF performed in the past you can play around with the buttons bellow:

  • YTD = how it performed this year
  • 1D how it performed the last day (standard)
  • etc

First we would like to get more detailed information about this ETF. We want to know for example how much the yearly cost is, if it

For that click on the documents tab on your screen.

Once you are there you can click on the download button to go to the documents:

I noticed that there is no direct link to the document but once you are on ssga you can search for the ETF

In the top right type SPDR® MSCI World UCITS ETF and click the first one that pops up.

Now you are at the overview page of the ETF.

We can for example read the desciption of the Index:

The Index captures large and mid cap companies across Developed Markets countries. The index covers approximately 85% of the free float-adjusted market capitalization in each country. Securities are weighted by market capitalisation.

If we scroll down (or click on “Holdings”) we can see the Geographical weights, so you should realize that this ETF is focusing more on the developed countries.

Other things you can see is what stocks it exactly invests in currently and what sectors they are in. The thing with ETFs is that a bigger stock such as Microsoft and Apple will also carry a bigger weight. A much smaller stock that is at the bottom. Apple for example has 3.35% weight, while the smallest stock (HEICO Corporation) at position 1579 only has weight of 0.000068%.

Now scroll further down and open the document called KIID

Click on KIID

This is actually an overview of the ETF in a standard format. Apart from some general information you will be able to see the yearly cost and the risk factor.

In this case the fund has only a 0.12% yearly cost and that is why it is one of my favorite ETFs.

We can also see that the ETF is not handing out dividends. How? Because it does not have Acc (=accumulating) in the name. If you are in a country where they have taxes on dividends then you want to avoid Acc ETFs. If it does not matter for taxes then I would go for Acc ETFs since its always encouraging to slowly see your dividends go up over time. Should you receive dividends you will also be able to see in this file how often you get the dividends. Usually this is quarterly but there is some ETFs that give it yearly or monthly.

Dividends are a sum of money paid regularly (typically annually) by a company to its shareholders out of its profits (or reserves).

Your first purchase on DEGIRO

Now that you are armed with more knowledge about the ETF or stock you want to purchase its time to do the actual purchase.

You can do that by going back to the ETF in DEGIRO and click the green button that says “Buy” (or “Koop” in Dutch)

In the next screen you will need to then set how many stocks you want to purchase and at what price:

I usually will set the purchase price a bit higher then the actual price. The system will still buy at the lowest possible price but then you are sure it will go trough fast.

You need to enter the max purchase price in the box next to Limit Order. Under the box limit order you need to enter the number of stocks or ETFs you want to purchase. The system will then calculate the max purchase price

For example I have entered the following and the system has calculated that it will cost me MAX 985 EUR, but most likely I will pay less.

Remember unless you chose a free ETF you will need to save 5-6 EUR for taxes and fees from the DEGIRO. Once you click on “Place Order” you will find out exactly how much the costs for DEGIRO is.

I can also see the impact on my free space, so I can actually see that I could have actually purchased 3 stocks more.

Once you are ready confirm your purchase, you will then have placed an order on the market. If you put your limit high enough, it will be purchased really fast.

Checking your current wallet

Now that you have some stocks in your wallet you can click on Portfolio to find out how your stocks are doing.

In my case I can see that I currently have an 8% loss, but we need to keep in mind that this blog was written during the corona crisis. At the height I was actually at a much higher loss in March 2020 as stocks had dropped 30%. Its good to note I have not lost one night of sleep over this drop as I know that ETFs cannot go bankrupt and if you pick one that is spread over multiple countries and sectors it will always reward in the long term. Always invest for longer periods. Five years is really the minimum but preferably you should be investing for a horizon of at 20 years. The stock market goes up average per year 6-7%. Also remember: the best time to invest was yesterday. The second best is today.

Conclussion

If you are new to investing I really hope this was a good overview for you. Please let me know in the comments if there is anything else you would like to know or if there is any place I can improve. And if you like to know more about investing then leave your email so we can stay in touch.

2 thoughts on “Your first steps on the stock market: DEGIRO Quick User Guide for beginners

  1. Dear,

    I am looking into investing in ETF’s as well (as a belgian). Although Degiro seems to be very competitive in its pricing and fees, I am still in doubt of using this broker. The reason for this, is the fact that, when using etf’s in our portfolio, we talk of an investment horizon of several years, maybe even decades, with sums of over 300K. What happens when Degiro goes bankrupt or does not survive a possible economic crash during these decades? Is there a guarantee of retreiving your hard earned cash? Could you maybe elaborate on this?

    Like

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