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How to buy Duolingo shares (DUOL)
Here we cover the basics of Duolingo’s history, from how it got its start to its prospects for the future. Then there’s a step-by-step guide that teaches you how to get your first share.
Compare the best Duolingo trading platformsCopy link to section
If you’re just looking for the best broker to buy shares from, then choose one of the options in the table below. We have extensively reviewed all of these platforms and they are among the top ones around. To learn more about Duolingo first, read on.
77% of retail CFD accounts lose money.
How to buy Duolingo stock, a step-by-step guideCopy link to section
The process of getting shares in Duolingo 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. 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 Duolingo shares.
- Place an order for DUOL stock. Search for Duolingo’s ticker symbol (DUOL) 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 own and place your order.
- Execute your order. Once you have placed your order, your broker will automatically execute it for you and your Duolingo shares will be listed in your account. Congratulations, you’ve just bought shares in Duolingo.
What is Duolingo? And should I invest?Copy link to section
It’s a language learning mobile app. Founded in 2011, Duolingo began as a computer science project based on teaching languages and translating the entire internet. Now, it has more than half a billion downloads and is one of the most popular education apps in the world.
The company operates a ‘freemium’ model, where anyone can start learning any of the 40 languages available for free. Those users see advertisements and there’s an option to subscribe for extra features with no ads. It relies heavily on being featured on the Apple iStore, where 50% of its revenue comes from
Tech startups have proven popular with investors because of the potential for their share price to grow many times over. They take on big losses in the short term in order to build a customer base that they can profit from over time. While this can be a very successful business plan, it can be risky for investors too as it makes the company vulnerable to new competition or economic downturns.
How has the company performed in recent years?Copy link to section
Duolingo only went public in 2021 so there is limited stock price data to go on. It entered the market priced at $100 per share but quickly jumped around 40% to $140, which valued the company at around $5bn.
While the share price and valuation might fluctuate, the key statistics that show how well Duolingo has performed are its revenue and user base. It had 25 million monthly average users by the end of 2018, 30m in 2019, and 42m by 2020. Its revenue grew from $36m to $161m over the same period.
Most of that revenue comes from paying subscribers, who only make up a small portion of the total number of users. That means its losses have grown along with an increase in marketing spending: it lost $13m, then $15m in 2019 and 2020, then lost $13m again in the first quarter of 2021 alone.
Is it a good time to buy Duolingo shares now?Copy link to section
It could be, as the pandemic has shown the value of remote-based learning and Duolingo is one of the most well-known education apps out there. If you’re more risk-averse, then it could be worth waiting for the initial buzz from its IPO to die down, as stock prices tend to be more volatile in the early part of a company’s listing.
Over the long term one of Duolingo’s biggest challenges is going to be turning a profit. It has millions of users – and almost half a billion downloads of its app – but the vast majority of them don’t pay for the service.
As a public company, there’s more pressure on financial results and quarterly performance. Investors in products like this want to see those subscriber numbers keep growing and for Duolingo to hit its targets every quarter. Otherwise it can prompt a big sell off. Use the links below to follow the latest news and find out as soon as Duolingo releases its results.
Buying, selling and trading Duolingo shares for beginnersCopy link to section
What to do before buying sharesCopy link to section
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 Duolingo? How did the company get its start? How did it grow? Is Duolingo’s revenue and profit growth picking up? Is the company innovating? The more you know about Duolingo, 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 bullish, 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?Copy link to section
If you’re new to stock investing, then it’s important to understand the basics of how to buy, sell, and trade Duolingo shares. Here’s a quick run-through of what’s involved in each.
This process involves finding a broker and placing an order for Duolingo 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 Duolingo 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 Duolingo’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 Duolingo 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 tradingCopy link to section
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 dealingCopy link to section
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
CFD TradingCopy link to section
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 DUOL 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 course on how to trade stocks.
How to choose a brokerCopy link to section
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. 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 trading 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.
Latest Duolingo newsCopy link to section
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Invezz is a place where people can find reliable, unbiased information about finance, trading, and investing – but we do not offer financial advice and users should always carry out their own research. The assets covered on this website, including stocks, cryptocurrencies, and commodities can be highly volatile and new investors often lose money. Success in the financial markets is not guaranteed, and users should never invest more than they can afford to lose. You should consider your own personal circumstances and take the time to explore all your options before making any investment. Read our risk disclaimer >