Do you want to buy or sell shares offline? In this post, you will find two ways to do it. You will also see when you have to choose one way over the other.
2 Types of Offline Share Trading (Buying/Selling)
You can buy or sell shares offline in two ways mentioned below.
- Trading by calling (by phone).
- Authorize portfolio managers to invest in equities.
Note: The second approach of authorizing managers has an advantage. In this approach, we are not talking about buying or selling stocks instantly, but about managing your investment as a whole. Managers will monitor your funds and allocate/reallocate your money in a range of assets including equity (shares).
2 Reasons for Offline Share Trading
You may have a need to buy/sell shares offline due to below reasons.
- Limited or No Internet Access: At times, you may not have access to internet. Maybe you are traveling to places with less connectivity. Or maybe the internet is restricted in your workplace.
- Experts Guidance: You may want expert’s advice and guidance (especially at the instance of closing a trade). Many people feel this way because they are not full-time share traders. Everyone is in a different profession and want time for important things in life. Savings and investment are important, but not at the cost of time with your family.
Hopefully, you can identify yourself with one of the above two reasons. Whichever may be the reason, you are lucky to have easy ways to buy or sell shares offline.
This is an online era. Every single activity is getting automated. Supercomputers and Robots make decisions. But still, people prefer real human assistance in important things like stock investments.
As we mentioned in the beginning, there are two ways to buy or sell shares offline. Let us discuss one by one with examples.
1 Selling or Buying Shares by Phone
You can very well trade equities using your phone. We are not talking about mobile apps but a plain phone call. Now you will see how this works.
Some stockbroker firms have representatives to trade on your behalf. You want to authorize them upfront. (Stockbrokers offering such services will do the paperwork for authorization).
In reality, offline trading is not new. Before the internet, people visited brokers in person or reached them by phone to execute orders. Online trading came into existence after 1985, thanks to the TradePlus platform of ETrade. Are there brokers still provide such offline services? You will find now.
Only handful brokers offer offline share trading. Manual effort is the reason why companies hold back on such customized services. Even if they do, they don’t make it an obvious feature on their websites for a reason. The reason is they do not want their offices flooded with phone calls 24×7. But there are exceptions. Now you are going to see one.
Charles Schwab is a well-known stockbroker. When you browse for top 5 stockbrokers of US, Schwab will always find a place. In addition to world-class online trading platforms, Schwab has come up with a unique offline product. And that product is called “Telebroker“.
Telebroker service helps you to buy or sell shares over a phone call. Not just share orders, but you can also request information on markets, stock prices etc. Do you wonder how such a service is feasible? Schwab created this unique product by mixing the best of two worlds – automation and human intervention. Automated voice response will guide you in trading. In case you need further assistance you can always switch to a human representative.
Next you will see a passive way of offline share investing.
2 Buying or Selling Shares Through Portfolio Managers
Stockbroker firms have qualified people who can do more than just buying or selling shares on your behalf. They are equipped to manage your complete investment portfolio. You will authorize them for allocation of funds across stocks and other assets like ETFs, Mutual Funds, etc.
Managed accounts are expensive services provided by most popular brokers. Fully managed portfolios will help those who have a need to invest in equities (shares) but do not have enough time.
How Exactly the Managed Accounts Help You Buy or Sell Shares Online?
The answer is simple. The managed services are handled by experienced professionals who manage your investments and allocation of capital.
More importantly, you will not be actively investing in individual stocks of companies. Most of the times, your investment will be in ETFs (Exchange Traded Funds) which represent a group of stocks. The proportion of different stocks in the funds will be decided by the fund managers. In managed accounts, you will have a say on preferences on specific ETFs.
Note: Many ETFs are usually classified based on sectors. For example, energy sector ETFs will represent all stocks of energy companies (weighed by some factor like the market cap). You can restrict sectors based on your preferences and goals.
In addition to ETFs, many portfolios allow you to invest in individual stocks (depending upon your risk tolerance.)
Pros and Cons of Managed Portfolios Over Traditional Offline Selling
Now you know managed accounts are not like trading over the phone (that we saw earlier in the example of Schwab). Managed portfolios are the ones where you will be a passive investor for most of the time. The passive nature of these accounts has earned them a place in offline trading. These accounts will help you if you have any of the below problems.
- You are not confident regarding your expertise in investing.
- You do not have enough time to analyze and manage investments.
Note: In case you looked for just buying or selling instantly over the phone, then these accounts will not help much. In that case, you can skip the rest of this post and head over to plans like those of Schwab that we discussed earlier.
Now that you have understood the context in which we categorized managed accounts under offline trading, it is time to see examples. A good thing about such accounts is that almost all leading stockbrokers offer such accounts. They have realized the need for managing accounts for people who have lots of things to do in life other than sitting before computer screens, analyzing and managing investments.
Fidelity Managed Portfolios
Fidelity provides at least 4 different plans for managed portfolios. You have to choose a plan based on your goals. Some common goals are given below.
- Saving for retirement.
- Investing for one time expenses like tuition fees.
- Investing for fixed income, etc.
Since a dedicated team is overseeing accounts, the companies require some commitment from you. Usually, there will be minimum investment threshold. For example, at Fidelity, the minimum investment is 50,000$ (for Fidelity Portfolio Advisor Services) for the starter plan.
Though most tasks will be taken care of by your managers, you have options to customize your investments. For example, in some plans, you may restrict your investments to specific equities. For example, in the plan named “Fidelity Personalized Portfolios,” you have an option to restrict your investments at securities level or industry level. This is all the intervention which you would do. Else all the tasks are taken care of for you. All you have to do is to check your progress on an ongoing basis. Also, you can discuss with your account managers for clarifications or additional customizations.
Another player known for managed portfolios is the 100-year-old wealth management wing of Bank of America. Merry Lynch is known for the world-class guided investment services.
Summary: Comparison of Active and Passive Ways to Buy/Sell Shares Offline
Below are the conditions where you would choose one approach (active or passive) approach over the other
You would choose active offline share trading if the following conditions are met.
- You have limited or no internet access.
- You are on a vacation or travel where you don’t have the comfort of sitting on your desktop and place orders. Many brokers provide stock trading mobile apps which you can use on the go. However, many people prefer desktops over mobile for important tasks like share trading. If you are one such person then offline trading is your only choice.
- You want the support of your stock advisor to place complex orders. Complex orders are those which cannot be performed efficiently using your terminal. For example, a complex order could mean buying huge volumes of equities of different companies in short time. These tasks could be handled by powerful terminals of stockbrokers.
Passive way to offline trading will suit you in the following circumstances.
- You don’t have enough time to manage your investments.
- You lack the expertise to handle complex investments. This applies more if you want to invest in different asset classes including stocks and lots of other instruments (bonds, mutual funds, ETFs, etc.)
- You are less risk tolerant and have apprehensions that you may make mistakes (especially during market downtimes).
- You have a long-term financial goal in mind but are not sure of the exact path and strategy. Long-term planning and execution requires enormous experience which many individuals lack.