A strong consumer brand such as Apple may have to interested in becoming an investor. You're not alone as many people are attracted to owning shares of Apple stock.
Luckily, it's not too hard to get started.
If you’re an Apple loyalist, or simply want to invest in the company because you think its stock will increase in price, here some different ways that you can buy Apple stock.
Apple: Company Overview
Before you invest in any company, you should understand what the company does.
Apple is a tech company that offers a variety of products and services to consumers.
Probably the best-known Apple products are the iPhone, iPad, and Mac computers. The company also sells tablets, watches, and TVs.
In a general overview, these are the major products and services offered by Apple:
- Consumer electronics
- Subscription and streaming services
- Digital content
- Financing options
Apple’s reach and range of product offerings has grown so wide you almost have to go out of your way to avoid the company if you don’t want to interact with its products and it shows on the company’s income sheet.
The company brought in $265 billion in revenue in 2018 with a net profit of nearly $60 billion.
Apple makes money every time it sells a phone, computer, or another piece of hardware, as well as every time someone signs up for one of its services or downloads something from iTunes. This means that Apple has a wide range of competitors.
Among the biggest competitors are:
Research and Analysis
When you’re buying stock in Apple, or in any company, it’s very important that you do your research before making the purchase.
The reality is:
No two people use the exact same method to research stocks and decide which ones to purchase, but there are some common strategies that you can employ.
Investors regularly look at a company’s:
- balance sheet
- financial statements
- quarterly filings with the SEC
- cash flow
- management team
- direction of the business
By reviewing this information, you can get a strong idea of how a company is performing and begin to guess how the company will perform in the future.
If you review these details for many companies, you might be able to find trends in an industry or identify an outlier.
Some investors also turn to technical analysis, using complicated formulas and rules to decide exactly when to buy or sell an investment.
Others rely on their gut, investing when it feels right.
Regardless of your strategy and research methods, it’s important to remember that there are no guarantees. Even if you find a company that is completely outpacing its competition, you might not earn a profit by investing in the firm.
In theory, the company’s stock will be priced to account for the company’s current success. You’ll be relying on future growth to push the stock price even higher.
How to Buy Apple Shares
If you’ve decided that buying shares in Apple is the right thing for you to do, the process for making your investment is not too hard.
Open a brokerage account
The first step to make when investing in any company is to open a brokerage account.
Many brokerages will charge transaction fees each time you buy and sell a stock.
If you don’t plan on trading regularly, this might not be a significant issue. If you have aspirations of playing the stock market on a weekly or even daily basis, you’ll want to find a low-cost brokerage.
Some brokerages also have minimum investment requirements. If you only want to buy one or two shares in a company, you’ll have to find a brokerage that allows you to open an account with a small amount of cash.
Depending on your investing goals, you’ll also want to look at the other services the brokerage offers. Some companies provide their customers with powerful research tools and professional analysis. Others focus more on sleek and easy user experiences or a powerful phone app.
Check with your bank to see if it offers investing services. Many banks that do will offer banking customers perks if they also open a brokerage account.
Once you choose a brokerage company and open your account, you’ll have to link your checking account. You can use the linked account to fund your investing activities.
Place an order
After you’ve set up your brokerage account, it’s time to place an order to buy your shares.
There are two types of orders you can use.
The simpler type of order is the market order.
You enter the number of shares that you want to purchase and your brokerage immediately purchases those shares from whoever is currently offering the lowest price.
For stocks in companies like Apple, this normally isn’t a problem.
The stock prices that you usually see reported are simply the prices used in the most recent transaction.
If there is a company whose shares are not traded very often, the current asking price and the price at the most recent transaction could be very different.
That means you might pay more than expected if you enter a market order.
When you enter a limit order, you enter the number of shares to purchase and the maximum price you’re willing to pay.
If no one is willing to sell for that amount, your purchase won’t happen until the stock’s price drops to your limit.
Limit orders can ensure that you don’t spend more than expected.
They can also be used if you want to purchase a stock at a specific price that is below its current value but don’t want to have to watch the stock every day to see if the price falls.
Alternative: Mutual funds
If you don’t want to invest in individual stocks but still want to invest in a company, you can invest in a mutual fund instead.
Mutual funds let you invest in dozens, hundreds, or thousands of companies by buying shares in just one fund.
That makes it easy to diversify your investment and reduce volatility.
If Apple does well, you won’t make as much money, but if Apple begins to perform poorly, you’ll lose less of your investment.
There are all sorts of mutual funds out there.
Some focus on specific segments of the market or certain industries. Others try to track the performance of an index, such as the S&P 500 or the Dow Jones Industrial Average. Still, others are actively managed using a specific strategy that the managers think will beat the market average.
Depending on how you want to invest in Apple, or whichever company you choose, you can buy shares in a mutual fund to indirectly buy shares in the company.
You may choose to invest in a mutual fund that focuses specifically on tech companies, or one that tries to track the market as a whole.
Consult an Advisor
Before making any investment, contacting a financial advisor can help you come up with a plan and decide whether the investment is right for you.
Financial advisors will be able to help you build a budget for your investing and help you understand how investing in a particular company will impact your overall investment portfolio.
Many financial advisors can help you build a full portfolio or to execute the trades that you’d like to make.
Robo-advisors are programs that manage your investment portfolios for you, targeting an asset allocation based on your goals and rebalancing your portfolio as different assets rise or fall in value.
By employing the services of a financial advisor or roboadvisor, you can reduce the need to monitor your investments and make it easier to save for the future.