Buying your first stock: what happens behind the button
In short
- You do not buy a stock directly on the exchange, you go through a broker that places your order there.
- When you pick a broker, look at supervision by the AFM or FSMA, at every type of cost and at what you can actually buy.
- A market order runs straight away at the price of that moment, a limit order only at your price or better.
- Investor compensation covers up to €20,000 per person if a broker cannot return your assets, but never a loss in value.
Buying a stock feels like one click. Behind that click sits a chain of parties that each do something, and sometimes charge for it. If you know the chain, you make fewer mistakes with your first order.
This piece is about how it works and which choices come with it. It does not tell you which stock or which broker to pick. That decision is yours.
Step 1: understand what a broker does
As a private person you cannot walk up to the exchange yourself. You go through a broker, usually a bank or an investment firm. You give the instruction, the broker places the order on the exchange and then holds your shares.
Step 2: check who supervises it
In the Netherlands only investment firms with an AFM licence may provide investment services. Banks need a licence from DNB. The AFM keeps a public register that shows which licence a company holds and whether it comes with restrictions. If a company is missing, the name may be misspelled, but it may also be an exempt or illegal party.
Be careful with foreign brokers. A firm from another EEA country that works in the Netherlands on a European passport is supervised in its home country.
In Belgium you look to the FSMA. Its website has a search tool called "Check uw aanbieder" and a list of warnings. On 24 September 2026 the FSMA reported 51 new fraudulent platforms on that list. That is why you check before you deposit anything.
Step 3: compare on costs, range and custody
Three things matter.
Costs: transaction fees per order, the spread (the gap between the buy and sell price), costs for converting currency and sometimes a fixed monthly or yearly fee. A low order fee with a wide spread or an expensive exchange rate is not cheap.
Range: can you trade on the exchanges and in the products you want? A broker that only offers European stocks does not help if you want American ones.
Custody: where are your shares held and who looks after them? More on that below.
Step 4: open your account
You sign up, identify yourself and link a bank account to deposit money. After that you can place orders. Allow some time, because verification can take a few days.
Step 5: choose your order type
There are two basic forms.
A market order has no limit. You buy at the next available price. When buying, that is the ask price on the screen, when selling the bid price. Rabobank notes that this price can be higher or lower than what you saw a moment before.
A limit order sets your boundary in advance. When buying you never pay more than your maximum, when selling you never receive less than your minimum. The price is certain, the execution is not. Your order may stay open, in whole or in part.
An example with invented numbers: the price hovers around €25.00 and you set a buy limit of €24.80. If the price never touches that level, you buy nothing. If you place a market order, you buy immediately, but maybe at €25.10.
For stocks that trade rarely, the gap between buy and sell price is often wider. A limit saves you more there than on large, busy stocks.
Step 6: add up every cost
On top of transaction fees come taxes in some places. In Belgium you pay stock exchange tax (TOB) on every purchase and sale. For most individual shares that is 0.35 percent, with a cap of €1,600 per transaction, according to Curvo. The rate depends on the product, so check it for your own order.
The Netherlands has no tax per transaction. A Dutch company does withhold 15 percent dividend tax on the dividend it pays. On the wealth itself you pay box 3 every year, which I cover elsewhere on BitFox.
Step 7: what happens after your order?
After execution comes settlement. In the EU that is currently T+2: two business days after the trade, cash and shares change owner. Euronext says T+1 starts on 11 October 2027.
Your shares then sit with your broker's custodian. Investment firms must keep clients' money and securities separate from their own assets. If the broker goes bust, your holdings should in principle stay reachable.
Protection if your broker fails
Separate custody is the first layer. The second is a compensation scheme.
In the Netherlands, investor compensation covers up to €20,000 per investor, and €40,000 for a joint account with your partner. It applies only if a failed investment firm cannot return your assets, for example because of fraud. A loss in market value is never compensated. Crypto held with crypto service providers is also outside it.
In Belgium the scheme is called the Protection Fund. It pays up to €20,000 per person per institution for financial instruments, under certain conditions.
The deposit guarantee of €100,000 per bank is something else. That covers balances on a bank account, not your shares.
What not to do yet
There is rarely a reason to rush. You can keep a first order small to learn the process. This is an explanation of how it works, not advice to invest or to choose any product.
Sources
- AFM, Register of investment firms, explanation, accessed 10 October 2026
- FSMA, home page with warnings and Check uw aanbieder, 24 September 2026
- Rabobank, Explanation of order types, accessed 10 October 2026
- DNB, Investor compensation, accessed 10 October 2026
- Rijksoverheid, What happens to my assets if my investment firm goes bankrupt, accessed 10 October 2026
- Belgian Protection Fund, Annual report 2025
- Curvo, Stock exchange tax TOB, 8 October 2026
- Euronext, T+1 programme, accessed 10 October 2026
- MKB Servicedesk, What is withholding tax, accessed 10 October 2026
