How to Buy American Airlines (AAL) Stock

There is no shortage of online brokers to choose from and the best brokers boast unique tools, service or fees to attract investors. You have to decide what is most important to you before you commit to a brokerage. 

Walk through the following considerations as you narrow your decision:

1. Analysis tools and research can help field your investment decisions. Decide whether you need comprehensive analysis through your broker or whether you can do the market research on your own. 
2. Many brokers offer commission-free trading. This is great, but remember, you exchange fees for service. Is it important to have commission-free trading or are you willing to spend a bit more for customer service?
3. Sure, you want to buy AAL stock today. But you will likely continue to invest in stocks, so it’s important to think about what kind of support you need to continue your investment experience. Look at the third-party integrations and personalized investment advice offered by a broker. These supports can help you build confidence as you continue in the stock market. 
4. Think about how you do all your other financial business. If you utilize apps, find a brokerage with a streamlined app offering. If you spend time at your desk, a desktop or web-based platform will be fine. Ease of use is key and online brokers have built their platforms to make your investment process simple.
5. Many brokerages offer phone and live chat support 24/7. It can be a good idea to contact customer service now, before you create an account. Get a feel for how you will be treated when a problem arises.

Remember, when you make your choice, be sure it is best for your needs. A sleek app may be best for someone else, but a low-cost option could be what you need. Compare brokerage offerings with your starting point to find your fit. 

Creating an account with an online brokerage is just like any other financial account. Be ready with your personal information (like your Social Security number) and prepare to transfer money to your account. 

Most brokers allow you to transfer funds in several different ways. Expect the ability to transfer electronically, by wire or an asset transfer. Once you’ve funded your account, you can go forward and buy American Airlines stock.

How many shares you buy should always directly correlate with what you are willing to lose. 

Before you decide how many shares you want, figure out the total amount you want to invest. You can figure out how many shares you can afford with simple math — divide your total investment by the price of a share. 

Your order type directs your broker. It tells the broker when to execute your order, the price you want to pay and more. 

The order type ensures clear communication and keeps control in your hands. Here is a quick rundown of the most common order types:

Bid: The bid price refers to the highest price that a buyer is willing to pay for a single share of any stock. A buy can happen when the seller finds the bid agreeable or the buyer adjusts the bid to match the ask price of the stock. 
Ask: The ask price, or ask, is the lowest amount of money a seller is willing to sell shares. 
Let’s say AAL is priced at $20. You can set your ask price for $21. When AAL reaches $21, your order will go through.
Spread: The spread is the difference between the bid and ask price. If the bid price for AAL is $20 and the ask price is $21, the spread is $1.Spreads get tighter when a stock has many buyers and sellers. 
Limit Order: A limit order is an order to buy or sell a stock at a specific price or more. If you set your limit order for AAL at $20, a buy limit order will only execute at $20, and a sell limit order will execute at $20 or higher.
Market Order: A market order is an order to buy or sell immediately. A market order guarantees the buy or sell, but it does not set a price. It usually executes at or near the current bid or ask price.
Stop-Loss Order: A stop-loss order signals you want to sell if the specified stock falls to a certain price. This order helps prevent excessive loss if your stock price drops. If you buy 5 shares of AAL at an average price of $20 a share, you might set a stop-loss order at $18. If AAL falls to $18, your broker will sell your shares. 
Stop-Limit Order: A stop-limit order combines 2 types of orders: a stop order and a limit order. Use a stop-limit order when you set a stop price and trigger a limit order. The limit order will execute at your limit price or better. It’s wise to use a stop-limit order to limit a loss or protect a profit because you can never be sure exactly where a stock may go.   

After you create your online account with a broker, you can buy AAL and any other stock you want to invest in. Take a look at stocks under $20, stocks under $10 or even stocks under $5. 

Choose your order type, click buy and execute your AAL trade.