On this page you will find a comprehensive guide to all the ways available to buy shares in Amazon, the US e-commerce giant. We will also include comprehensive lists of the best Amazon real stock brokers and Amazon stock CFDs. Let’s get started!
There are two options, as with any other company: buying shares directly or speculating on the fluctuations of their price through CFDs. With the second option you will invest less money and you will do so through a leveraged product, i.e. you will participate with much more money than you have actually paid. Profits (and losses) will be consistent with the amount you participate with (not with the amount actually invested).
If you decide to trade CFDs on Amazon shares, simply log on to one of the brokers that offer the option to buy Amazon shares and follow the registration and purchase instructions. It is usually a very quick and easy process. But we would not want to end this paragraph without warning our users that contracts for difference are complex instruments that carry a risk of capital loss, especially if they are traded using leverage.
All the platforms we show you at OkBrokers are regulated brokers. Analyse each of them, as they vary in terms of commission, minimum investment amounts, etc., and choose the one that best suits your needs and preferences. And if you are new to trading, we always recommend starting with a demo trading account. Only put your money in play when you are ready.
Among the brokers that allow you to invest in Amazon are those that offer you the possibility to buy shares in cash, i.e. real shares. Below is a list of the brokers that, in our opinion, are the best brokers for buying Amazon shares.
When you buy Amazon shares in cash through an online broker, you will be buying these shares as if you were buying them through a traditional broker, but with the convenience of doing so from any electronic device. In addition, the commissions of online brokers are often lower than those of traditional or bank brokers.
Brokers to trade Amazon CFDs
Another way to invest in Amazon is through CFDs. These are complex instruments that are not recommended for investors who do not have sufficient knowledge, but allow trading in financial instruments without purchasing them outright.
We have already warned about the risks, but there are also some advantages to be mentioned: CFDs on Amazon shares allow you to open short positions, which opens up the possibility of profiting from falls in the value of the chosen asset.
We have already seen that, as a general rule, the trend in Amazon’s share price is upwards. But what happens if they start to fall? With CFDs you can also make money on the downside, because, as we said before, you speculate on the price fluctuations, either up or down.
To do this you have to apply the technique known as going “short”. This involves selling a stock that you do not own, but which you will buy in the future. If the share price falls and you take this action, your profit (net of commissions, spreads, etc.) will be the difference between the selling price and the buying price.
In 2018, Amazon tripled its profits compared to the previous year. It made a profit of $10.073 billion (around €8.8 billion). It earned 203 billion euros, 31% more than in 2017, and its investors pocketed around 17.5 euros per share. In the last quarter of 2018, it earned €2.64 billion. Take a deep breath, we’re going to tell you everything you need to know to buy Amazon shares.
But first, a little more context: Amazon shares are currently trading at USD 3,087.07 (up from USD 2,020.99 in 2019). A growth that, although it has suffered the normal ups and downs expected in any stock market (USD 3,401.80 was the peak in August 2020), seems to have no ceiling.
Amazon, which went public in 1995, became the world’s most valuable company in January 2019 with a market capitalisation of $797 billion, surpassing Microsoft’s $784 billion. As of March 2021, the company’s market capitalisation amounted to $1,579.67 billion.
Founded in 1994 by Jeff Bezos as a website for selling books online, it has been able to adapt to changes in the sector, to the explosion of the Internet and to economic crises. And it has done so by diversifying its business. For example, Amazon Web Services (its cloud computing service) was the company’s most profitable in 2018.
Amazon’s shares are listed on the Nasdaq Global Select Market of the Nasdaq All Markets in the United States and its capital is largely held by institutional investors such as Vanguard Group, Stat Street Corporation, Capital World Investors, Royal London Asset Management and others.
After this review of the figures that make Amazon a true giant, it goes without saying that it is usually a very good option to buy shares. But nothing is that easy when it comes to investing. So read on because in this article we are going to show you how to buy Amazon shares in spot or CFDs (Contracts for Difference).
Amazon’s business model
Before investing in Amazon you will be interested in knowing in detail its business model, as it has changed over the years. This company was born as a portal where you could buy books online but over the years more and more verticals have been added to its portfolio.
Products and services offered by Amazon
- Online shop
- Amazon Lockers
- Amazon Prime Video
- Amazon Alexa
- Amazon Echo
- Amazon Music
- Amazon Fire TV
- Amazon Kindle Fire
- Amazon Kindle
- Amazon Cloud Drive
A whole range of products and services contribute to the high profitability of this multinational company present in many countries.
No one can answer this question with absolute certainty. No one can know 100 % how a company’s shares will perform in the future, otherwise many more people would invest, and obviously many more people would get rich by investing.
It is clear from the figures at the beginning of this article that Amazon is a solvent and growing company. It is clear that its figures denote an excellent state of health and that there is nothing to suggest that it will collapse in the short term. But, in the end, all of this is just guesswork.
In order to know, in a more concrete way, whether or not it is a good time to buy shares in a given company, it is necessary to study it thoroughly. To do this, there are two types of analysis: fundamental and technical.
Fundamental analysis consists of looking at the balance sheet, sales, costs, accounts. And also to do it with the competition. It is not a quick process, but it is your money that will be at stake, so it is worth it. If, after doing this analysis, you find that the shares are worth more than the price you have to pay, it’s time to buy. Otherwise, it is best to sell.
Technical analysis is based on looking at stock price charts. In other words, trying to anticipate future movements by looking at how they have evolved in the past.
- Earnings: As is to be expected, financial markets react to each of Amazon’s regular earnings releases. This is a factor to be taken into account as it can and often does affect the value of the stock in the short term.
- Launching new products: If there is one thing Amazon is known for, it is the constant search for new businesses and services to offer its customers. Amazon Prime, Kindle, its online shop, Amazon GO physical shops. The list is sure to keep growing.
- News and regulation: especially those affecting the online industry either locally or globally.
So much for our guide to buying Amazon shares. We hope you found it useful. Leave us your comments below.
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