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How to buy Coca-Cola shares (KO)
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This page will explore a brief history of Coca-Cola and how its stock has performed in the recent past. We’ll see if now is a good time to invest, and what you should look out for before doing so.
Compare the best Coca-Cola trading platforms
If you already know everything about Coca-Cola, you can sign up to one of the brokers below to get started. We’ve assessed all the best trading platforms and compared them so that picking the right choice for you is quick and easy. Otherwise, if you’re not ready for that yet, keep reading for more information on Coca-Cola.
How to buy Coca-Cola stock, a step-by-step guide
It’s relatively simply to get Coca-Cola shares, 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. The first thing you need is an online broker. 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 Coca-Cola shares.
- Place an order for KO stock. Search for Coca-Cola’s ticker symbol (KO) 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 Coca-Cola shares will be listed in your account. Congratulations, you’ve just bought shares in Coca-Cola!
What is Coca-Cola? And should I invest?
Coca-Cola is one of the most famous brand names in the world. The Coca-Cola Company (NYSE: KO) manufactures and retails a range of non-alcoholic drinks and has been a mainstay as one of the top American companies for the best part of a century. It first paid a dividend stock in 1920 and has now raised it for 58 straight years.
Coca-Cola has made a series of aggressive acquisitions to solidify itself at the forefront of the beverage industry alongside its eponymous drink. Even during a tumultuous 2020 it prioritised increasing its dividend once again, so it might be an interesting stock if you are looking for stable, reliable dividends.
KO is firmly established as part of the Dividend Aristocrats Club, a list of companies that have raised dividends for at least 25 years in a row. Although it faces challenges in the form of sugar taxes and pressure to make healthier drinks, Coca-Cola has continued to grow regardless and could offer long term returns. No investment is a sure thing, however, and you should research its fundamentals as well as read on to find out more about the company and its prospects.
How has the company performed in recent years?
Prior to the pandemic, Coca-Cola had been performing reasonably well. It rose from $20 in 2008 to $45 a decade later, despite growing consumer and regulatory demand for healthier drinks. KO has become accomplished at overcoming that type of pressure and it briefly traded above $60 for the first time ever in February 2020.
The biggest ongoing challenge for the Coca-Cola Company has been reducing sugar in its drinks. Governments around the world have made moves to address the growing obesity crisis and the World Health Organisation has endorsed sugar taxes as a way to combat it. The UK government instituted a sugar tax in 2018 which affected the classic coke, along with Fanta, which is also produced by Coca-Cola.
KO has addressed this change in the market by offering low-sugar versions of its drinks, like Coke Zero, as well as diversifying. The Coca-Cola Company bought Costa Coffee in 2018, acquired numerous water and juice manufacturers, and has a stake in Innocent smoothies. These moves have helped the KO price keep increasing for the last decade, to the extent that it was still trading at $54, near the all-time high, at the end of 2020.
It was able to achieve that increase despite the coronavirus pandemic, which initially hit KO hard. The share price lost a third of its value in a steep initial fall, although it did quickly rebound. As the company usually relies on out-of-home sources for nearly half its annual revenue, bars, restaurants, cinemas and stadiums closing across the world was a major blow.
Is it a good time to buy Coca-Cola shares now?
Despite difficulties in response to the pandemic, Coca-Cola has usually been a good company for long term investors. You can rely on the dividend to provide a return on investment and it has been responding to market pressures by diversifying into healthier drinks, while it can count on global strength to protect it against normal economic downturns.
It’s that global strength which has helped it weather a pandemic that was hugely problematic for food and drinks manufacturers. Coca-Cola is so strong across the world that it could benefit from the areas which got back to normal fastest, particularly China, Korea and Hong Kong.
As movement increases again around the world, it could be a good news for the Coke share price. It should be noted, however, that there is still considerable uncertainty in the beverage market while the company is also restructuring to try to improve its performance. You can keep track of the latest news on that as well as market analysis below.
Buying, selling and trading Coca-Cola 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 you start.
- Research the company. You should always examine the fundamentals of a company first. What is Coca-Cola? How did the company get its start? How did it grow? Is Coca-Cola’s revenue and profit growth picking up? Is the company innovating? The more you know about Coca-Cola, the better positioned you’ll be to make smart investment decisions.
- Make sure you understand the basics of stock investing. Before starting to invest 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. A broker is the best way to invest in Coca-Cola. 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 reviews of the best brokers 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 latest news 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 Coca-Cola shares. Here’s a quick run-through of what’s involved in each.
This process involves finding a broker and placing an order for Coca-Cola 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.
When you sell any Coca-Cola 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, hoping to benefit from the company growing steadily throughout. Or, if you see that Coca-Cola’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 is the same process, 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 Coca-Cola 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.
Share dealing vs 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 KO 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 beginner stock trading courses and read up on CFD trading to get you up to speed.
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 find 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 fund your account 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.
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