The basic steps to buy a stock on E*TRADE

To buy a stock on E*TRADE, you log into your account, search for the stock by its ticker symbol, enter the number of shares you want, choose whether to buy at market price or set a specific price, and confirm the order. The entire process takes a few minutes once your account is funded. E*TRADE will show you the current price, any fees that explore, and the total cost before you confirm.

Your order goes to the market when ready if you choose a market order (buying at whatever the current price is) or sits waiting if you set a limit order (buying only if the price drops to your target). Either way, you own the shares once the order fills, and they appear in your account holdings.

Key Takeaways

  • You need a funded E*TRADE brokerage account before you can buy stocks; transferring money from your bank takes one to three business days.
  • Market orders buy when ready at the current price, while limit orders wait for the stock to reach a price you set.
  • E*TRADE charges no commission on stock trades, but the bid-ask spread (the difference between what buyers and sellers will pay) is a real cost you will see at checkout.
  • Your shares settle in two business days, meaning the money leaves your account and the shares officially belong to you on that timeline.

Setting up your account and funding it

Before you can buy anything, you need an E*TRADE brokerage account with money in it. If you already have one, skip to the next section. If you are opening a new account, E*TRADE will ask for your Social Security number, address, employment information, and funding source. The account opens the same day in most cases.

Once your account is open, you need to move money into it from your bank. Log into E*TRADE, go to the Transfers section, and link your bank account. E*TRADE will ask you to verify two small deposits your bank sends over, which takes one to three business days. After that, you can transfer money whenever you want, and it arrives in your E*TRADE account within one to three business days.

You can also fund your account by mailing a check, but that takes longer. Most people use the bank transfer method because it is faster and you can repeat it without paperwork.

Finding and selecting the stock you want to buy

Once your account has money in it, log into E*TRADE and look for the Trade or Invest tab. Click on Stocks, then type the company name or its ticker symbol into the search box. The ticker is a short code — Apple is AAPL, Microsoft is MSFT, Tesla is TSLA. If you do not know the ticker, typing the company name will show you results.

E*TRADE will display the stock's current price, the bid price (what buyers will pay right now), the ask price (what sellers want right now), and the spread between them. You will also see charts showing how the price has moved over the last day, week, month, or year. Take a moment to look at this information, but do not feel pressured to decide when ready — you can close this page and come back later.

Click on the stock to open its detail page. Here you can see news about the company, analyst ratings, and financial information. None of this changes the mechanics of buying, but it may help you decide whether you actually want to own this stock.

Placing a market order versus a limit order

When you are ready to buy, click the Buy button on the stock's page. E*TRADE will ask you how many shares you want and what type of order you want to place. A market order buys when ready at whatever price the stock is trading at right now. A limit order waits until the stock reaches a price you set, then buys automatically.

Market orders fill almost when ready and may provide you will own the shares, but you do not know the exact price until the order completes. Limit orders let you control the price, but there is no may provide the stock will ever reach that price — your order could sit unfilled forever. Most people starting out use market orders because they are simpler and you know what you are paying.

Enter the number of shares. E*TRADE will show you the total cost, including the bid-ask spread. There is no commission fee on stock trades at E*TRADE, but the spread is a real cost — it is the difference between what you pay and what the stock is actually worth at that moment. The spread is usually small for popular stocks and larger for less-traded ones.

Reviewing and confirming your order

Before you confirm, E*TRADE shows you a summary: the stock name and ticker, the number of shares, the price per share, the total cost, and the order type. Check that everything is correct. If you entered the wrong number of shares or changed your mind about the price, you can go back and edit.

Once you confirm, the order goes to the market. If it is a market order, it fills within seconds. If it is a limit order, it waits in the queue until someone is willing to sell at your price. You will see a confirmation number and a message saying your order was received.

Your shares do not officially belong to you until they settle, which happens two business days after the order fills. During those two days, the money is held in your account and the shares are marked as pending. After settlement, the shares are fully yours and you can sell them whenever you want.

Monitoring your position and understanding settlement

After you buy, the shares appear in your Holdings section on E*TRADE. You can see how many shares you own, what you paid for them, what they are worth right now, and whether you are up or down in value. E*TRADE updates these prices throughout the trading day.

Settlement is the behind-the-scenes process where the stock exchange confirms the trade and transfers ownership. For stocks, settlement takes two business days. That means if you buy on a Monday, the shares settle on Wednesday. If you buy on a Friday, they settle on Tuesday (because the market is closed on weekends). During those two days, you own the shares but cannot sell them yet.

After settlement, you can sell your shares whenever you want during market hours (9:30 a.m. to 4 p.m. Eastern time on weekdays). You can also set up alerts so E*TRADE notifies you if the stock price hits a certain level.

Understanding costs and fees

E*TRADE charges no commission on stock trades, which means you do not pay a flat fee to buy or sell. However, you do pay the bid-ask spread, which is the difference between what buyers will pay and what sellers want. For a stock trading at $100, the bid might be $99.99 and the ask might be $100.01 — that two-cent spread is your cost.

The spread is built into the price E*TRADE shows you at checkout. You will see it as part of the total cost calculation. Spreads are usually tiny for large, popular stocks and wider for smaller or less-traded ones. There are no other hidden fees for buying stocks on E*TRADE.

If you hold the stock for a long time and it pays dividends (cash payments to shareholders), E*TRADE deposits those dividends into your account automatically. Dividends are not a fee — they are money the company pays you for owning the stock.

Frequently Asked Questions

Can I buy stocks during after-hours trading on E*TRADE?

Yes, E*TRADE offers after-hours trading from 4 p.m. to 8 p.m. Eastern time. After-hours prices can be more volatile and spreads are usually wider, so your order may not fill or may fill at a very different price than you expected. Most beginners stick to regular market hours (9:30 a.m. to 4 p.m.) when there is more trading activity and tighter spreads.

What happens if I do not have enough money in my account to buy the shares I want?

E*TRADE will not let you place an order if you do not have enough cash. The system checks your available balance before you confirm. If you want to buy more shares, you need to transfer more money from your bank first, which takes one to three business days.

Can I cancel an order after I place it?

Yes, but only before it fills. Once the order fills, the shares are yours and you own them. If you placed a limit order that has not filled yet, you can cancel it from your Orders section. Market orders usually fill so fast that cancellation is not possible.

Do I have to pay taxes on my stock purchase?

You do not pay taxes when you buy the stock. You pay taxes when you sell it and realize a gain or loss. E*TRADE tracks your cost basis (what you paid) and will report your gains and losses to the IRS at the end of the year if you sold anything.

What is the difference between buying a stock and buying a mutual fund on E*TRADE?

A stock is a single company's ownership share. A mutual fund is a basket of many stocks or bonds managed by a professional. Stocks require you to pick individual companies, while mutual funds spread your money across many holdings. Both can be bought on E*TRADE with no commission.