DEMYSTIFYING STOCK TRADING.

A Beginner's Guide to Financial Empowerment.

In the ever-evolving landscape of finance, the once daunting world of stock trading has become more accessible than ever before. Thanks to commission-free online brokerage accounts, individuals from all walks of life can now venture into the stock market, a realm once considered exclusive to the elite. From historical roots under Venetian moneylenders to the bustling trading floors of Wall Street, the stock market has undergone centuries of evolution, eventually becoming a global hub for financial activities.

Even in the previous few decades, a lot has changed from the days when the stock market was thought to be a tool for the wealthy. Since commission-free online brokerage accounts have become more popular, anyone can now purchase or sell stocks directly from their computer screen.

For novices, the thought of investing in the stock market may first seem daunting, but you'll soon find that buying and selling stocks is not quite as difficult as you may have imagined. Come get a brief introduction to the stock market, its operations, and how to get started.

The development of the stock market into what it is today took several centuries. Venetian moneylenders discovered they could make money by buying and selling debt as early as the 1300s. Then, in the 1500s, Belgium created a kind of stock exchange that was limited to bonds and promissory notes.

The Dutch East India firm didn't become the first publicly listed firm until the 1600s, when it started to pay investors dividends to fund its maritime expeditions.

Time travel to the late 1700s, when a few traders set up shop under a buttonwood tree to create the future New York Stock Exchange (NYSE). Before the National Association of Securities Dealers Automatic Quotation System (NASDAQ) was founded in, the New York Stock Exchange NYSE was the most dominant stock exchange in the world and it remained so for a considerable amount of time.

Kenya has seen multiple regimes of currency rates. A fixed exchange rate was in place from 1960 to 1970, and it was subsequently tied to the US dollar until 1974. As a result, the nominal exchange rate fluctuated erratically in relation to the dollar, depreciating the shilling by 14% over the course of seven years, from 1974 to 1981. Later, at the end of 1982, the government switched to a crawling peg system, which persisted until October 1993[1]. In 1990, a dual exchange rate system was adopted.

Following a number of regimes, the nation adopted a floating exchange rate system in which the value of the currency fluctuates in respect to other currencies. Economic factors that affect supply and demand in the market, such as trade, production, and investment, are the main determinants of this. Therefore, unless there are extraordinary circumstances, like high volatility, the Central Bank of Kenya (CBK) would control the currency rate by engaging in transactions on both sides of the exchange rate market and will not set a specific objective for the exchange rate.

Despite the scary nature of the stock market, stock trading is actually very easy to get started with. Knowing which stocks to buy and when to do so is the difficult part. A large portion of this is about learning about different trading methods and styles through research and education. First things first, though.

You'll need to open a brokerage account in order to begin. Investors used to rely on brokers to place their orders for them in the past. For a price, brokerages still provide hands-off investors with this kind of assistance. However, there are also a ton of commission-free brokerage account options available these days that let you open an account online and handle all of the buying and selling yourself.

You may open a free online brokerage account in a matter of minutes with brokerages like Charles Schwab, TD Ameritrade, WeBull, Fidelity, and more. You will need to submit identity verification and fill up some basic personal information, just like when creating a bank account. After that, you can fund your new brokerage account with as much money as you wish to invest and link it to your bank account.

The average yearly exchange rate between the shilling and the US dollar over the last five years has been Ksh 102.22. For the years 2015, 2016, 2017, 2018, and 2019, the shilling's yearly average exchange rate versus the US dollar was 102.3, 102.5, 103.2, 101.9, and 101.4, respectively. When the COVID-19 epidemic started, the shilling fell below 110 and then 111 in the fourth quarter of 2020. By the end of December 2020, it had recovered to 109.17 (Figure 1). As a result, by December 30, 2020, the shilling has lost roughly 7.72% of its value in relation to the US dollar year to date (YTD).

Understanding the intricacies of stock trading is no longer reserved for financial experts and Wall Street insiders. With the rise of user-friendly online platforms, individuals can dive into the world of stocks, gaining control over their investments and financial futures. Opening a brokerage account has never been easier, with reputable platforms like Charles Schwab, TD Ameritrade, and Fidelity offering commission-free services. As we navigate the fluctuations in currency rates, individuals can seize the opportunity to invest wisely, learning about different trading methods and styles to make informed decisions.