If you’re new to stock market investing, buying shares in a brand-name company like Cisco could be a solid way to get started. But it’s vital that you have some understanding of the fundamentals of investing before you take the plunge. We’ve produced this page, and plenty more easy to grasp educational articles, to help you on the path to becoming a successful stock market investor. If you’re ready to start investing, follow our helpful links below to find a dependable platform. If not, keep reading.
Buy Cisco stocks right now
Ready to invest in Cisco shares? Click on the links below to choose the online broker that best fits your needs. To gain a better understanding of your investment choices and how they work, read on.
Trade Cisco stocks right now
Looking for an alternative to long-term investing? Consider trading shares of Cisco instead. When trading shares, you’re looking for shorter-term profits by buying and selling in a short amount of time. We’ve reviewed the low-fee online brokers that are best suited for that kind of high-volume trading.
How to buy Cisco stocks in 7 simple steps
Being a consistently successful stock investor takes work. If you want to buy shares of Cisco, research the company and the stock’s history first. At the same time, it’s important to look beyond the stock you have designs on and try to gain an appreciation of the state of the stock market as a whole. This analysis should inform your decision making and help you choose a suitable form of investment.
Initially, it’s wise to commit relatively small amounts of capital. As you gain experience, you might opt to venture more money and experiment with more complex forms of investments. Here’s a quick checklist to follow as you consider investing in Cisco.
- Know the company. What is Cisco? How did it grow to become one of the biggest tech companies in the world? Is Cisco’s revenue and profit growth accelerating or decelerating? The more you know about the company, the better equipped you’ll be to make smart investment decisions.
- Learn the basics. Knowing the key terminology matters. Try to familiarise yourself with all the terms that are commonly employed in the process of buying stocks, such as bid price and ask price. You’ll also want to know the different ways you can invest in Cisco, such as share-dealing and trading.
- Share-dealing vs Trading. Share-dealing involves buying shares of a company. You can make money from share-dealing in two ways: by selling your shares for a profit, or you can make money from dividends (if it’s a company that issues dividends).
- Trading is a shorter-term approach than investing and often entails buying and selling shares on the same day (day trading). If you day-trade shares in Cisco, you’re more likely to be reading the stock’s chart than worrying about the company’s long-term future.
- Set a budget. When you first start investing, it’s a good idea to start with a smaller budget, say, £1000 or less. At the time of writing, Cisco was trading at a little below $50 a share, so you could buy 26 shares with your allotted budget of £1000. As your experience grows, you might gradually choose to get more aggressive with your investing strategy.
- Choose a broker. You can buy and sell shares in Cisco via any number of online brokers, many of which will only charge a few pounds per trade. Find a broker that offers an easy-to-use platform, a strong reputation, and yes, low fees.
- Evaluate market conditions. When the stock market rises for a long time (a ‘bull market’), most stocks rise too; when the stock market falls for a long time (a ‘bear market’), most stocks fall too. Follow the broader market trend. Don’t try to fight it.
- Make your first investment. You now know how Cisco operates, and you understand how stock investing works. You’ve established a budget, found a broker you like, and verified that the market is in an uptrend. Log onto your online brokerage account, type in Cisco’s ticker symbol (CSCO), make sure the price the stock’s trading at isn’t too high for your liking, then buy. Congratulations, you’re the proud owner of Cisco shares!
Ways to invest in Cisco – share-dealing vs trading
There are a few options to buy, sell, and trade shares in Cisco online. Share-dealing and CFD trading are two of the principal options:
Share-dealing means buying shares in a company. It’s a longer-term approach than trading shares in an effort to bank a quick profit.
- Pros: You won’t need to master the art of chart-reading and technical analysis. Share-dealing instead focuses on assessing the company’s fundamental strength, which includes its earnings and revenue growth. If Cisco starts going up, holding for longer could lead to a big profit.
- Cons: You tie up your money for longer, instead of having it available to make multiple transactions. If Cisco starts falling sharply right after you buy it, you could be set for a long, emotionally gruelling ride.
CFD means contract for difference. CFDs are investment derivatives that let you speculate on the price movement of an individual asset – such as forex, commodities, or shares in Cisco – without actually owning that asset.
- Pros: With a CFD, you can deposit a percentage of the total trade value, and the CFD broker will cover the rest (this is called leveraged trading). Since you’re trading with leverage, if shares in Cisco rise, you’ll make a bigger profit than you would have if you’d only ventured your own money. CFD trading makes sense if you don’t want to deal with owning and storing commodities or currency,
- Cons: Just as leveraged trading increases the size of your gain if Cisco shares go up, it also inflates the size of your loss if the stock goes down. Also, if you leave a leveraged CFD position open for more than a day, you might have to pay overnight fees. Some consider it a bad choice for trading stocks because you lose the voting rights and potential dividends that can come with owning shares in certain companies.
The more you know, the easier it is to make smart investing decisions. Read our guides and courses to improve your investing knowledge or, if you’re ready to get started, click on the above links to finds a platform you can trust.
How to buy, sell and trade Cisco shares for beginners
If you’re thinking about buying shares in a stock for the first time, here are some basic guidelines to familiarise yourself with before you hit Buy or Sell:
You can buy shares through an online broker. Buying shares is recommended for investors who want to hold on to them for longer. Log onto your online brokerage account, type in the ticker symbol of the stock you like, click Buy, and hey presto, you now own those shares!
When selling shares, you want to sell at a higher price than you bought at and thus earn a profit. Exactly when you sell can vary. You could try to hold for an extended period, hoping to get the biggest profit possible. Or, if you see that your Cisco shares are already up a lot on the price you bought them at and the market is struggling, you could choose to sell.
You can trade shares either through a conventional online broker, or by using a CFD broker. If you choose a CFD broker, know the risks that come with leveraged trading and take note of the extra fees that CFD brokers charge.
Our top tips for investing in shares of Cisco
You now have a better idea of how to invest in Cisco shares. Here are some more key points to remember:
- Know your budget. Don’t put up more than you can afford to lose. Be cautious at first, then expand your budget slowly as you gain more experience.
- Choose the right investing approach. Make sure the investment strategy you use matches your investment goals and your tolerance for risk.
- Stick to an investing plan and don’t react to emotions. Follow a sound plan and you’re more likely to succeed. Emotions such as fear and greed can hurt your investing results.
- If market conditions change, know how to deal with it. When the stock market rises or falls, you don’t need to watch helplessly as your money evaporates. Make decisions while keeping the state of the broad market in mind.
- Learn from your mistakes. Everyone makes mistakes when investing, even expert investors. Review your mistakes. Figure out what went wrong, and which different approaches you can take to do better. Apply those lessons in the future to achieve better results.
Unsure which platforms to use?
Not sure where to go from here? That’s not a problem. Here’s a list of considerations to help you decide how to proceed:
- Budget size. If you have a budget of around £1000, you might want to limit the number of trades you make. For instance, if you try to day-trade Cisco shares right away, you could get up to 20 trades pretty quickly. If your transaction cost is £10, you’ll blow through 20% of your budget on transaction fees alone. Instead, keep things controllable by simply buying Cisco shares to start with. If you have a larger budget (greater than £10,000, for instance) you have more options to work with, including day-trading, CFD trading, and other approaches.
- Risk assessment. The more you know, the better you’ll be able to handle risk. Also, more complex investing options can open up for you once you’ve mastered the basics. For instance, you can choose to sell shares of Cisco short. When you sell shares of a stock short, you’re betting that their price will go down, not up. Alternatively, you can buy shares, then protect your investment. So, if you buy shares of Cisco at $50 per share, you can put in a stop-loss order at $45 per share. Therefore, if the stock starts falling, you won’t lose more than 10% of your investment.
- Market conditions. Say the stock market starts tumbling. More defensive investment strategies, such as bonds or commodities, become sensible options in such an environment. On the other hand, if the market’s doing well, you‘re better placed to ride the wave and buy shares of Cisco.
- Know your investing goals. If you’re trying to make money quickly, use faster-moving trading strategies, such as day-trading. If your timeframe is measured in multiple years or even decades, you’re more likely to buy shares as a long-term investment, trusting that the strength of the company will last.
- Keep track of emerging trends. Technology is always evolving, creating exciting new investment opportunities. To keep succeeding, Cisco will need to adapt to changing trends, or risk falling behind its competitors.
What is Cisco?
Cisco is a multinational technology giant based in Silicon Valley. Cisco employs more than 74,000 people, and clocked more than $49 billion in revenue in 2018. For more information on the company, including charts, live prices, analysis, and more, visit our Cisco stock price page.
Try some of our stock market courses for beginners
Not quite ready to invest? We understand. Our stock market courses for beginners will help you get your head around the investment fundamentals. Once you’re more familiar and comfortable with stock investing you should be in a position to make sound investment decisions that stand a better chance of delivering profits.