Alibaba (BABA) - All you need to know
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Ways to invest in Alibaba
The first thing to do is sign up with an online stock broker. Brokers are platforms that allow you to execute stock market trades.
There are other ways to invest beyond simply buying or selling shares directly with a broker, though. Those ways include a mutual fund that holds shares of Alibaba or buying and selling exchange-traded funds (ETFs). The links below take you to individual pages which guide you through every step of the process.
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What is Alibaba?
Alibaba is one of the largest e-commerce companies in the world. Based in China, Alibaba is a huge technology company that specialises in online retail, using artificial intelligence and other advanced technology to grow its business. Founded in 1999, Alibaba has grown to become one of the largest tech companies in the world, reporting $72 billion USD in revenue for fiscal year 2020.
If you’re new to the stock market, check out our Stock Markets 101 course, which explains everything you need to know in easy-to-understand, simple steps.
How to invest in Alibaba
We recommend getting to know all the options available before buying shares of Alibaba, so you can make an informed decision between the available options. Here is a quick summary of the different methods. To learn more, simply follow the link to our guides on each subject.
- Alibaba stock brokers. If you want to buy Alibaba shares quickly and directly, the simplest option is to use an online stock broker. Many online stock brokers charge only a few pounds per trade. They usually offer some basic research tools to help you better understand the potential risks and rewards of buying Alibaba shares.
- Alibaba ETFs. There are many ETFs which hold shares of Alibaba. You’ll see Alibaba in ETFs that hold stocks in Chinese companies, in emerging markets, in large-cap technology stocks, or all of the above. Owning Alibaba shares through an ETF means you’re spreading your risk, since ETFs allow you to hold many stocks at once.
- Alibaba mutual funds. A mutual fund is a way of investing where investors pool money together to be given to a fund manager, who aims to generate steady profits for all. An increasing number of mutual funds hold shares of Alibaba, which is no surprise given the tremendous growth seen by both the company and its stock.
- Alibaba trusts. A trust is a kind of closed-end investment company that’s popular in the UK. Alibaba trusts allow you to trade Alibaba on the stock market by owning shares in a trust.
- Alibaba CFDs. An alternative form of invest in Alibaba is through CFD trading (contract for difference). The biggest difference between trading with a CFD vs. simply buying shares online through an online stock broker is that you get to speculate on Alibaba’s price without actually owning the underlying asset (in this case, shares of Alibaba). This means you can make quick trades with low fees, and often trade with leverage.
- Alibaba ISAs. An ISA (Individual Savings Account) is a tax-free savings account that allows you to set aside a portion of your income for investments (the ISA allowance for each tax year in the UK is up to £20,000). Within your ISA you can own all kinds of assets, including shares of Alibaba.
Where can I buy Alibaba shares now?
77% of retail CFD accounts lose money.
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