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Shares: How to choose a stock broker and use direct market access

Created:

23 April 2008

Updated:

24 April 2008

Written by:

Dominic Picarda

If you want to trade shares, you'll need to choose a stock broker or set yourself up with direct market access (DMA), which allows you to plug straight into the stock market's trading system. Be aware that DMA is only really suitable for experienced investors who trade frequently.

For the buy-and-hold investor, using a stock broker is likely to be more cost effective. But which one? Our annual guide to UK stock brokers compares the cost and service of dozens of brokers, whether you want an online stock broker, a stock broker who offers advice, or a broker who will still trade share certificates. Access the Investors Chronicle stockbroker survey.

Direct market access is hugely powerful, but you need to know what you're doing.

The first thing to understand is the difference between market makers, level 1 and 2 pricing and how DMA works.

Then you can look at how to make sense of market dynamics and use different order types to take advantage of them.

You can also try out DMA using the London Stock Exchange DMA simulator (opens in new window).

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