How To Buy Apple (AAPL) Stock – Forbes Advisor

Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors’ opinions or evaluations.

Whether you’re an Apple fanboy or you can’t quit your Android, there’s no denying Apple Inc’s (AAPL) power in the stock market.

According to its most recent earnings report, Apple’s third-quarter revenue grew 36% year over year. Meanwhile, AAPL’s stock price has risen over 18% year to date.

If those numbers have you salivating for a slice of AAPL, you can buy Apple stock in six simple steps.

How to Buy Apple (AAPL) Stock

1. Select a Brokerage

An online brokerage is your gateway to buying and selling stocks. In addition to enabling you to purchase Apple shares, online brokerage accounts also provide a wealth of research, educational materials and account types to help you meet your investing goals.

If you’re investing for long-term goals, like your child’s college education or your retirement, you’ll probably want to buy AAPL in a tax-advantaged account, like an individual retirement account (IRA) or 529. But if you need money for other things, like buying a home or investment property, a taxable investment account is probably a better choice.

Fees, services and investment options can vary by broker, so compare multiple brokerages to find the right one for you. If you’re not sure where to start, check out our picks for the best online brokers.

Once you’ve settled on the best online brokerage for you, buying Apple stock is very simple: Just enter Apple’s ticker symbol—AAPL—and how many shares you want to buy (or how many dollars you want to spend). Once the order is filled, you’ll be the proud owner of a hugely successful tech company.

That isn’t the end of the road when it comes to buying shares of Apple. Be sure to look over the next five steps to make sure you’re investing your money wisely.

2. Determine How Much You Want to Invest

Even CEO Tim Cook doesn’t have an unlimited amount of money to pour into Apple. When deciding how much to invest in Apple, ask yourself the following four questions.

  • What’s your budget? How much money do you have left over each month once you’ve paid all of your bills? That’s how much you have to save and invest. At least some of that should go toward an emergency fund, if you don’t already have one, as well as retirement savings. But the rest you’re free to invest as you choose.
  • What’s AAPL’s current price? Apple’s stock price is constantly changing, but it has been above $100 a share for over a year, as of August 30, 2021. If you’re just starting out, you may not want to commit to purchasing a whole share of AAPL stock. Instead, you may prefer to buy a portion of that share, called a fractional share. Some brokers—Charles Schwab, Fidelity, Stash and Robinhood—allow you to buy these portions of traditional shares.
  • What’s your investing strategy? When you’re ready to invest, you can opt to invest a lot of money at once or small amounts gradually over a long period of time, via dollar-cost averaging. This is when you buy fixed dollar amounts of stock at regular intervals—usually monthly—regardless of the stock’s price. It decreases your risk and can help you pay less per share on average over the long term.
  • What about your other investments? If you have other investments, you’ll want to think about how AAPL may fit into your overall portfolio, says Brandon Renfro, a certified financial planner (CFP) and investment advisor. “Apple is a large-cap tech stock, so investors should be aware of the other stocks they own in the same category,” he said.

3. Decide on Your Investment Goals

Before purchasing stocks, spend some time thinking about your investment goals. Investing always has some level of risk, and buying large amounts of single shares of any company can be particularly risky.

Apple itself notes that it has experienced substantial price volatility in the past and can be significantly impacted by external factors. While past performance is no indication of the future, you may face similar volatility in the future. Lawrence Sprung, a CFP and wealth advisor with Mitlin Financial, recommended that the price fluctuations should influence how you invest in Apple.

“I think Apple, as an investment, is well suited for someone that has a moderate or higher risk tolerance, the ability to withstand volatility and a long-term time horizon,” he said. “They are a leader in their industry, and typically that will present a great case for a good long-term investment.”

4. Evaluate Apple’s Financial Health

Though it’s exciting to buy shares of an individual company, especially a big name like Apple, you should take a moment to do your due diligence.

Start your evaluation by reviewing the documents that publicly traded companies like Apple are required to file regularly: annual reports (Form 10-K) and quarterly reports (Form 10-Q). These reports disclose detailed performance and financial information, and they’re usually referred to in the financial press as earnings reports or quarterly.

You can find them on Apple’s investor relations site or by searching the SEC’s database. You can also make use of expert analyses to provide some insight, like you might find on Fidelity, Morningstar or Forbes. You can then take all of the information and expert commentary you collect to determine if Apple seems to be a financially sound company you want to invest your money in.

5. Decide Your Order Type and Place Your Order for AAPL Stock

On your brokerage platform, you can put in a request to buy AAPL stock at the best current price or use a more advanced order type, like limit or stop orders, to only purchase shares once the stock price falls below a certain threshold.

Since Apple is traded on the Nasdaq exchange, it can be bought or sold between 9:30 am and 4:00 pm ET Monday through Friday. However, the Nasdaq does have pre-hours and after-hours trading, which you may be able to access through your online brokerage.

Nasdaq’s pre-market trading hours are 4:00 am until 9:30 am, and its after-hours trading runs from 4:00 pm until 8:00 pm ET. ​​If you place an order outside of the hours your brokerage allows you to trade during, it will be processed once trading resumes.

6. Evaluate Your Investment’s Performance

It’s wise to periodically review your investment portfolio and its performance.

To evaluate the performance of Apple or other stocks, first start by looking at the annualized percent return. This will give you a number you can compare to other investments as you gauge how well your investment is performed. You may also want to revisit the fundamental data you looked at earlier to see how it develops over time.

You can compare this information to other stocks or benchmarks like the S&P 500 and Nasdaq Composite Index. By looking at those benchmarks, you can get an idea of ​​how your investment is performing relative to certain industries or the market as a whole.

How to Sell Apple Shares

You probably won’t hold your AAPL shares forever. Eventually, the time will come for you to cash out and hopefully see a tidy profit on your investment.

To sell your Apple stock, return to your online brokerage platform, enter the ticker symbol, the number of shares (or dollar value) you want to sell and select a sell order type. These generally have the same names and work effectively identically to the order types we covered above.

Keep in mind, if your investment has increased in value, you may owe taxes on your profit. These so-called capital gain taxes are determined based on your income level and how long you held your AAPL stock. If you’re concerned about how selling your Apple shares may impact your taxes, don’t be afraid to speak with a tax professional, like a certified public account (CPA).

How to Invest in Apple with an Index Fund

While individual shares are one way to invest in Apple, it’s not your only option. You could also invest in index funds or exchange-traded funds (ETFs), which you can buy through your online brokerage like you can individual stocks.

Because these investment funds own hundreds or even thousands of different stocks, they’re generally considered to be less risky than individual stocks while still offering solid long-term returns.

“Index funds or ETFs are an inexpensive way to gain exposure to Apple and other companies in the technology industry,” said Sprung. “This allows investors to mitigate some risk by not having exposure to simply one security in that industry or a significant overweight.”

What’s more, Apple makes up a not-insignificant portion of many leading index funds (roughly 6% of many S&P 500 funds, for instance), meaning you’ll still have a hearty exposure to AAPL even while you diversify the rest of your holdings .

Over the past year, this broader approach has paid off for investors. While Apple itself is up about 18% from August 30, 2020 to August 30, 2021, the S&P 500 has risen almost 30% during that same period.

Leave a Comment