The Bank of America Corporation is one of the world’s largest companies, providing banking and financial services to millions of people. Find out if Bank of America shares are a wise investment.
When investing in Bank of America shares, it’s important to have a good understanding of stock market investing, what to consider when buying shares, and the details of the best online brokers. Keep reading to find out all you need to know.
Compare the best platforms to invest in Bank of America shares
If you want to buy Bank of America shares right away, then simply follow one of the links in the table below to our trusted brokers. Our data comparisons help you find the right platform to execute your trades. If you need to know more, then simply keep reading down the page to learn about stock investing.
How to buy Bank of America shares, a step-by-step guide
The process of buying shares in Bank of America isn’t massively complicated, so don’t worry even if you’re new to stock investing. These are the steps to follow in order to complete your investment:
- Choose a broker. In order to buy Bank of America stock, you will need to use an online brokerage platform. There are many different options to choose from, each with their own unique benefits and drawbacks. The comparison table above can help you select the right broker for you, and you can head to our comprehensive broker reviews if you’re still unsure.
- Create an account. Once you’ve selected your broker, simply go to their website and create an account. The steps required for this will vary from platform to platform, but generally you can expect to have to provide your name, email address, phone number, and some form of photo identification.
- Deposit funds. Log into your broker account and select the option to deposit funds. Depending on your broker you’ll have a variety of payment options available; most brokers accept bank transfers and debit card payments, but not all accept e-wallets such as PayPal. Select your preferred payment method and deposit the amount of money you wish to invest in Bank of America shares.
- Place an order for BAC stock. Now navigate to the broker’s buying stocks page (a link to this can be found in the menu on the website). Here you’ll be able to search for Bank of America’s ticker symbol (BAC) and see the current price at which the stock is trading. If you’re happy with the price, enter the amount of shares you wish to buy and place your order.
- Execute your order. Once you have placed your order, your broker will automatically execute it for you and your Bank of America shares will be listed in your account. Congratulations, you’ve just bought shares in Bank of America!
What is Bank of America? And should I invest?
Bank of America is the USA’s second largest banking institution behind JPMorgan Chase. The company operates all around the world, with a presence in every major financial hub, including New York, London, and Hong Kong. the banking arm of the Bank of America Corporation holds more than 10% of all bank deposits in the United States.
The company’s roots go all the way back to 1956, and it’s shares trade on the New York Stock Exchange. The value of the company’s stock fell by almost 50% in early 2020 as the coronavirus pandemic caused panic in global markets, and shares in Bank of America Corporation (BAC) are taking a long time to recover this damage.
In terms of whether you should invest your money in Bank of America, what you want to consider is if the stock currently offers value for money. Banking institutions fare well when markets are rising, as spending and borrowing increase and drive economic growth. So, if you believe the world is heading into a bull market, then BAC shares can be a good bet. If the future is looking bearish, then it might be best to look for alternative investments.
To help make your decision, you can find up-to-the-minute charts, price information, statistics, and analysis on our Bank of America quote page. For now, however, keep reading to find out more about Bank of America and if it’s the right investment for you.
How has Bank of America performed as an investment in recent years?
Bank of America’s recent performance can be split into two categories: before Covid and after COVID. The five years in the run up to February 2020 saw BAC shares roughly double in value to trade at $34.85 per share on 20th February. However, when the coronavirus pandemic spread across the world Bank of America then saw its shares fall by 48% to close at $18.08 on 23rd March.
The stock rallied after March, but it seems a long way back for Bank of America Corporation to reach its previous highs. This doesn’t necessarily make BAC shares a bad investment, in fact it could make it a good time to buy the stock in anticipation that it will surge as the global economy bounces back. The company is solid, has global recognition, and remains a cornerstone of the US economy.
Is it a good time to buy BAC shares now?
As BAC shares are currently trading at a much lower value than the start of the year, it could be a good time to invest in the stock. The judgement that has to be made is whether it looks like the USA will recover strongly from the coronavirus-induced financial crash, increasing the value of Bank of America Corporation shares as the economy bounces back – or whether a market rally is still a while off and the share price could still fall further.
If you’re buying shares for the long term, then examining the fundamentals of BAC is more important than what will happen in the short term, and there are still plenty of reasons to believe the stock will rise in the long term. If you’re trying to time your investment just right, however, it is a good idea to check out the company’s current price-to-earnings ratio and also to keep on top of our latest expert analysis and features. The most recent of these can be found below.
Bank of America shares rise sharply supported by Covid-19 vaccine news
Bank of America (NYSE: BAC) shares have advanced from $23.2 above $28 in less than five days and the current price stands around $27.3. The technical picture implies that the price may advance above $30 this November but there are also some obvious risks when it comes to buying Bank of America shares. Fundamental analysis: Bank of America is a stable bank with a good position on the market Bank of America shares have been moving in an uptrend las…
Bank of America shares plunge as net interest income slumps in Q3
Bank of America (NYSE: BAC) shares have further selling pressure after a drop in Q3 net interest income and the current price stands around $24. When trading this stock, investors should have in mind that Bank of America is a stable bank with a good position on the market. Fundamental analysis: Q3 net interest income was down 17% from a year ago Bank of America is an American multinational investment bank and financial services holding company. T…
Buying, selling and trading Bank of America shares for beginners
What to do before buying shares
You should always take the time to research a stock fully before investing your money, especially if you haven’t bought shares before. The more knowledge you have, the better your chances of making a wise investment.
With that in mind, here’s a checklist to run through before investing in Bank of America shares.
- Research the company. You should always examine the fundamentals of a company before buying its stock. What is Bank of America? How did the company get its start? How did it grow? Is Bank of America’s revenue and profit growth picking up? Is the company innovating? The more you know about Bank of America, the better positioned you’ll be to make smart investment decisions.
- Make sure you understand the basics of stock investing. Before getting involved in the stock market, make sure you have an understanding of how it works. This will ensure that you have more clearly defined goals and have thought through how you will achieve them.
- Decide between share dealing and CFD trading. Choose the type of investment strategy you want to pursue, and make sure you have carried out the necessary fundamental or technical analysis for share dealing and CFD trading respectively.
- Set the size of your budget. The golden rule of investing is never to risk more than you can afford to lose. Not every investment you make will result in a profit, so it is important to set a budget that not only allows good potential for capital growth, but also protects against overly damaging losses.
- Find the right broker. Individual brokers each have their own pros and cons. Some will have low fees but have a user interface you struggle to understand, whereas others may be a bit more expensive but come with a range of features that you want to take advantage of. Our broker reviews can help you find the right platform for you.
- Examine broader market conditions. No stock exists in a vacuum, and it’s always important to analyse the general trends of the stock market as a whole before investing. If a bear market is setting in and stock prices are falling, it’s best to wait it out and invest your money later when the stock is cheaper. If, however, the market is looking bearish, you’ll want to make your investment quickly to get the maximum benefit from rising stock prices. Our news section can help you keep on top of movements in the financial markets.
What is the difference between buying, selling, and trading shares?
If you’re new to stock investing, then it’s important to understand the basics of how to buy, sell, and trade Bank of America shares. Here’s a quick run-through of what’s involved in each.
Buying Bank of America shares
This process involves finding a broker and placing an order to buy Bank of America stock, as outlined in the steps further up this page. Ideally you want to time your investment when the stock’s price is low so that you can profit by selling the shares after they increase in value.
Selling Bank of America shares
When you sell any Bank of America shares you have bought, you’ll want to do so at a higher price than the one at which you bought to earn a profit.
When you sell is up to you. You might decide to hold for a long period of time, hoping to benefit from the company growing steadily throughout. Or, if you see that Bank of America’s stock is already up a lot compared to the price you bought it and you’ve noticed that the stock market is starting to fall, it might make sense to sell and take your profits to invest elsewhere. Equally, if the stock has fallen since you bought it and looks set to fall further, it might be a good idea to cut your losses by selling your shares.
Trading Bank of America shares
Trading is the same process as buying and selling shares, it’s just done over shorter periods of time with the aim to make small profits on a regular basis. This means that you can make money faster and spend your profits in your day-to-day life – however, on the other side it means you can lose money faster as well. For inexperienced investors, we generally recommend making investments for at least 6 months to a year instead of making trades in quick succession.
You can trade Bank of America shares through buying and selling shares, or by trading with CFDs. These allow investors to speculate on stock prices and trade with leverage in pursuit of bigger gains. CFDs trading is explained further in the next section, but it is worth noting that beginners should avoid trading with leverage. It comes with large risks and is best left to experienced investors.
Ways to buy Bank of America shares: share dealing and CFD trading
When it comes to investing in any stock, the two options you have are share dealing and trading. Which one of these methods to opt for largely depends on your investment timeline, with investors thinking long term tending to go for share dealing, and those looking for short term gains pursuing a more aggressive trading strategy.
Here’s a quick summary of the two approaches, and the pros and cons of each.
Share dealing refers to the practice of buying and holding shares in a particular company over the long term. When investing like this, you’re seeking to profit either from dividend payments or an increase in the stock’s price over time.
When investing your money this way, it is important to do thorough fundamental analysis of the company in which you are investing. You want to put your money in a stock you believe will trend upwards over time, even if there is some market volatility along the way, rather than get distracted by shorter term peaks and troughs.
- Can build wealth over time to achieve financial goals
- Don’t need to be very reactive to short-term market movements
- Some stocks will give you an income through regular dividend payments
- Takes a long time to realise any profits
- Your capital is tied up in stocks and cannot be used for other investments
If your aim is to generate profits in the short term, then you might be better off trading shares than holding them in your portfolio. Stock trades like this are executed using CFDs (contracts for difference), which allow investors to trade against the value of a stock without having to take ownership of it. When CFD trading, investors are looking to buy and sell stocks fast to profit from short-term fluctuations in value.
One aspect of CFD trading that many investors find attractive is that they allow you to trade with leverage. This means you can place large trades while only putting up a fraction of the value yourself – for instance, if a platform offered leverage of 1:10, you could put £10 into BAC shares and be able to trade £100 worth. This can maximise profits if the market moves in your favour, but be careful as it can also lead to heavy losses.
When trading using CFDs, it is key to be skilled at technical analysis and reading stock price charts. As you’re trading stocks quickly and frequently, the fundamental strength of the company in which you’re investing isn’t as important as being able to predict how its stock price will rise and fall minute-by-minute.
- Can generate fast profits if you read the market right
- Some platforms allow you to trade with leverage
- Prevents your capital being tied up so you can take advantage of investment opportunities
- Trading with leverage is risky and can lead to big losses
- Doesn’t necessarily generate growth over the long term
Consider which approach suits you best and craft an investment strategy that works for you. If you need more information, then simply take our stock trading course and read our guide to CFD trading to get you up to speed.
If neither of these options appeal to you, then you can find a variety of other ways to invest in BAC stock on this page. If, however, you’re ready to buy Bank of America shares now, simply select one of the brokers in the table above and get started.
How to choose a broker
With the wide variety of online brokers available these days, it can be hard to figure out which is the best service to go with. Our comparison table and in-depth reviews can help you cut through the noise, but by and large these are the aspects you should be considering when selecting a broker:
- Range of stocks available. The most important thing is that you can actually use the broker to buy the shares you’re looking for. Some brokers offer more stocks than others, and many will allow you to trade other assets, such as forex and commodities.
- Fees and commissions. You want to keep as large a chunk of your profits as you can, so it’s important to make sure your broker doesn’t charge high fees that can eat into your profits.
- Regulation. You should only use regulated brokers to place trades and buy shares. Unregulated brokers can be risky and offer little to no protection if the business were to fail while you had funds in your account.
- Payment methods available. You might want to buy Bank of America shares using a specific payment method, such as PayPal. Not all brokers accept every payment method, but using our comparisons you can search only the brokers that support the option you’re looking for.
- Reputation. One of the strongest indicators of a broker’s reliability is the reputation it has with the customers who have used it. Brokers are online businesses, and as such many user experiences can be found online. You can check these out in addition to our reviews to make sure you choose the right platform.
- Customer service. As you’re going to be investing your money using the platform, you want to check that the broker offers good customer service in case you have a query or something goes wrong.