How to buy Netflix (NFLX) shares
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Where to buy Netflix stock
An online stock broker is the best place to buy Netflix stock today. Choose one of the platforms below to get started right now, or keep reading to learn more about the company.
How to buy Netflix stock, a step-by-step guide
1. Choose a broker and create an account
You need to use a broker to buy and store your shares. There are lots of different types of broker and you can read reviews to compare them. Low fees and an easy to use interface are the two most important features to look out for. Once you’ve chosen a platform, sign up to start investing.
2. Decide how much you want to invest in Netflix
Put no more than 5% of your total portfolio into any one stock. Although Netflix is a big name company, it’s a good idea to spread your money around as much as possible so that there is less risk of one investment hurting your overall wealth too much. It is also important to note that you don’t always need to buy an entire NFLX share to start investing and some brokers allow you to buy a fraction of it.
3. Research Netflix and its potential
Look into how Netflix measures success and who its competitors are. For example, subscriber growth is an important metric and Amazon, Apple, and Disney all run rival streaming services. You can look at the subscriber numbers across each platform to get an idea of how Netflix is performing and whether it has room to grow.
4. Place an order for NFLX stock
Once you’ve done your research, log into your broker account to make the investment. Search for Netflix using its ticker symbol, NFLX, and then enter how many shares you want to buy and how much money you want to spend.
5. Execute your order
Review the details of the purchase and once you’re happy with it, hit ‘buy’ to execute the order. The order may take some time to process if you place it outside of normal working hours. As soon as it does you can see your new shares in the portfolio section of your broker account.
6. Review your investment regularly
Take the time to review all of your investments at regular intervals so that you can decide when to sell. Use the latest news to inform those decisions, and pay close attention to quarterly earnings dates as there can be a lot of activity around a stock at those times.
What is Netflix? And should I invest?
Netflix is a streaming service that lets people watch film and television series on demand by paying a monthly subscription. It was formed in 1997 as DVD-rental service before it became one of the most successful ventures of the modern era when it shifted to online streaming.
The introduction of faster broadband speeds after 2010 was a key point in the Netflix story. Thanks to its first mover advantage, Netflix became almost synonymous with online streaming. Only recently has the rise of alternatives from Amazon and Disney threatened its position as top dog.
That competition is a key consideration for anyone who wants to invest. You need to think about whether Netflix can continue to add customers now that the pandemic is over, the cost of living is higher, and with many different companies competing for their customer’s money.
How has the company performed in recent years?
The short answer is extremely well, although it has had a tougher time since the pandemic. Netflix was doing well before COVID-19 hit, then global lockdowns caused a big spike in subscribers and sent the stock above $500 a share.
Global uncertainty, rising living costs, and increased competition has made 2022 a much tougher year, however. Netflix relies on constantly increasing subscriber numbers because it’s expensive to create new content. When it announced a reduction in subscriptions in the first quarter of 2022, the stock lost 25% in value overnight.
That shows how sensitive the stock price can be. The reverse was true during the pandemic, when Netflix added more 20 million new subscribers and nearly doubled in value over a couple of months to become the biggest entertainment company in the world.
Is it a good time to buy Netflix shares now?
That depends on whether you think consumer demand can cope with so many streaming options. If not, then the question is whether Netflix can offer enough quality content and the best value for money. This is becoming harder; it raised its prices in 2022 and has a smaller library of its own content compared to Disney in particular.
Netflix is targeting regional markets and original, local language content as a way of adding new subscribers. It’s also considering a new, low-cost service that includes adverts, in a major policy shift for the company. The success of these two ventures could be crucial to its long term health.
Potential investors should look out for new content aimed at Asian markets like India, China, and Korea. The price point of its new, cheaper subscription is also worth keeping an eye on. Use the latest news links below to keep tabs on all this and anything else that affects the company.
Ways to invest in NFLX
- Buy Netflix shares. Buying shares in a company is best for hands-on investors who want to take complete control of buy and sell decisions. Owning shares also gives you the right to vote on governance issues and earn dividends, if Netflix decides to pay them.
- Invest in Netflix ETFs. An ETF is best for beginners or passive investors. ETFs track a particular index, sector, or industry by owning a large number of stocks. Look for a tech ETF, NASDAQ ETF, or FAANG ETF to get exposure to Netflix.
- Invest in Netflix funds and trusts. Funds and trusts are best if you want to put your money in the hands of a professional investment manager. The fund manager decides what to buy and sell in order to make the best returns for everyone who has a stake in the fund.
- Trade Netflix. Trading is a short term approach that uses technical analysis to decide when to buy and sell. By studying price charts you can make predictions on how you expect the price to move in the future.
- Spread betting. Spread betting is similar to trading, except you bet on which way you think the price will move. You make money based on the number of points a price moves in a particular direction, multiplied by the value of your stake.
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