Last updated on June 23rd, 2023
Written by Himanshi Raj
Amazon's rise from its online bookstore beginnings to its current retail dominance has been impressive. What started as a humble garage project became a billion-dollar e-Commerce enterprise. As of writing, the retail giant has over 300 million customers worldwide. That number will continue to grow as more people shop online—and the rise of the Amazon trading platform.
Amazon trading is under the "AMZN" ticker on the NASDAQ exchange. While it primarily dabbles in retail e-commerce, it also operates in other industries, such as cloud computing, digital content, and consumer electronics.
This article will discuss everything about trading on the platform. So that aside from being a successful Amazon seller, you can also thrive and grow your income by being an Amazon investor. Let’s begin!
For beginners, trading can be as intimidating as much as beginning your Amazon Store. So, where do you even begin? Before the discussion, let's first cover the trading basics. This will give you some necessary background as the discussions get more specific. Here are the necessary steps first-time investors should take:
Before you begin trading, we recommend researching and consulting with Amazon stock experts, especially if you don't know the share price properly. This step would be the perfect time to ask if you have questions.
Research does not stop at the consultation; you must do some yourself. If you plan to invest in a company, look up its history, net revenue, market cap, management, and earnings. Stock research is valuable if you want to invest in the long haul of fractional shares.
Investing money does not come in a one-size-fits-all method. These are some options you can choose from:
Choose Amazon stocks and fund them by yourself. Do you want a hands-on approach? As much as you learn the ropes in beginning your Amazon store, learn on your own when it comes to trading.
Let the professionals do the trade. If you prefer having someone else manage your investments, get a seasoned expert to do the job. Of course, the person should be competent enough to run things as trading involves money.
Invest in your employer's 401(k). For the unaware, a 401(k) is a plan employers offer that packages retirement savings and investments. Many beginners start their investments through this option because of its tax advantages. A good thing about this type is that investors learn effective investing practices, such as making small yet consistent contributions.
First-time investors can always benefit from an online broker's expertise and options. In addition, having one on your side makes it easier to access NASDAQ, especially if you plan to invest in a publicly listed company.
Investors should pick online brokers that align with their needs and goals. Not every broker allows clients to open accounts with them, and they sometimes offer expensive rates. Take note of their rates, accessibility, and trading platforms.
You initially just wanted to sell on Amazon, but if you're 100% decided on investing, now's the time to open an account. Investors who adopt a hands-on approach prefer retail investor accounts because they can invest not for anyone but for themselves.
Meanwhile, opening a brokerage account is quick and affordable. Setting one up takes around 15 minutes, much like a savings account.
Losing money rapidly, indeed, isn't your goal, both as an Amazon seller and now as an investor. Have a budget to ensure you won't lose money when trading. But how much money is enough to get things started?
If you want to buy individual Amazon stocks, look at the share prices of your desired investment/s. Amazon stock prices can range from a few hundred to a few thousand dollars, so check them frequently in case of price movements. This should help you set a budget when you're ready to purchase Amazon stocks.
Are you planning to use mutual funds? That's alright, especially if you have a tight budget. However, if you're pondering this option, go for an exchange-traded fund (ETF), which works similarly to a mutual fund. In this case, an ETF tracks a specific index or other assets, which can be sold or bought on a stock exchange, just like a regular Amazon stock.
Did you know that most financial advisers prefer investing through funds? If an expert recommends this, take the suggestion. This option allows investors to allocate a significantly large portion of their portfolios to Amazon stock funds, especially for long time windows.
Keep your investments small if you plan to buy individual Amazon stocks. This practice makes investment management easier.
While this depends on you, long-term stock market investments are never wrong. It's always a good call because investors can count on the 10% yearly stock return average regardless of day-to-day or year-to-year events.
Going over daily fluctuations won’t change things much, but there will be times when investors need to check on their stocks. Your portfolio/s and investment goals should align with each other to avoid mismanagement.
Understandably, investing in a powerhouse like Amazon can seem far-fetched, especially for beginners. But investors like yourself have to start somewhere. And fortunately, buying Amazon shares online isn't a crazy idea nowadays. So if you're brave enough to do it despite the risks, go for it! But the question is, how do you do just that?
This section will walk you through the necessary steps for Amazon stock trading. If you want to add other companies to your list of investments, this process remains applicable since they're similar.
Before buying stocks, check the company's current Amazon stock price to see if it fits your budget. Make sure yours is enough to cover your expenses, savings, and Amazon stock purchase. If it doesn't fit, ask your broker if they can allow you to buy portions of individual stocks.
After setting up your trading/brokerage account, you can now buy and store your shares. This step is where you'll deposit your money for the stock split. Buyers can send cash through debit cards or electronic wallets. Much like the account setup, the deposit will only take a few minutes.
When you've got everything ready, you can finally buy the share. Log in to your brokerage account, look for “Amazon share,” and state the number of shares you want to buy. From there, click the “Buy” button to begin the purchase.
The work doesn't stop at buying. Keep a watchful eye on your investments, regardless if you're a short- or long-term investor. Whatever strategy you use, try your best to follow it through until you've reached your investment goals. If you need more assistance, you can ask for help from Amazon stock experts and other professionals for practical monitoring advice.
For beginners, going into Amazon stock trading is taking an investment plunge. It's unfamiliar and unpredictable, but the payoff is worth the risk, especially with proper guidance. If you want to go for it, follow the pointers above to start you on the right path and stray from bad practices. If you have more questions or clarifications about this article or are interested in growing your Amazon store along with trading, contact us. We'll be happy to hear from you and start a conversation about Amazon full account management.
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