How to Buy Amazon Stock in Senegal
Founded in 1994 by magnate Jeff Bezos, Amazon is, by far, the largest e-commerce company and the second-largest in cloud services. Due to the COVID-19 pandemic, with basically the whole globe turning to online shopping, the company's income has increased exponentially.
Buying Amazon (AMZN) stock is as easy as purchasing any product on Amazon. In this guide, we will explain how to invest in Amazon shares from Senegal with a display of some of the best available brokers, the incredible potential of this company and its value, the trends, and the fundamentals of investing in the world's favourite online shopping platform.
How to Buy Amazon stock in Senegal in 4 steps
Pick a broker to buy Amazon Stock that is available to local traders (Some Brokers restrict clients from Senegal)
Open your brokerage account
Deposit cash into your account
Buy Amazon stock
Let's illustrate each one of these steps.
Step 1: Pick a broker to buy Amazon Stock
To buy Amazon shares in 2022, you should assess a broker that, ideally, excels in several of these qualities:
Low Trading charges: A good broker charges low or null commissions when opening and closing a trade and offers tight spreads.
Regulated by a Credible Government Agency: Being in Senegal implies that you could end up being approached by a company that is a fraud. However, a regulated broker is the best alternative to avoid dealing with the wrong individuals. Accordingly, if a broker declares that they are regulated, perform your checks on them. As an example, if they claim to be ruled by the UK's FCA, review if it's indeed true. In general terms, always check the Broker's website's footer; that's where they usually make their regulatory claims.
Simple Registration Process: We don't want to do a lot to open an online account. However, do not trust a broker with a null registration process: They are probably not regulated if it's too easy.
Good Term in Business: This is a double-edged remark. A platform's tenure is not a protection that shields traders per se. However, a long tenure in business hints that a financial services provider overcame several market ups and downs. Therefore, we consider that a provider's tenure of +10 years is indeed a good sign. On the other side, avoid ancient financial institutions (like conventional banks, for example); they will probably charge you more and lack the latest functional trading technology.
Free e-Learning Material: If you are a novice trader, it is always a plus if a broker offers a good set of free e-learning materials. Seek to attend every forum, webinar or free learning experience a broker delivers. It will help you to get your trading ability running. Warning: The Broker will try to sell you extra services but split the trash from the wheat.
An Acceptable Set of Financial Instruments: Aim to open an account with a broker that offers many stocks from different stock exchanges. The bigger the offering, the better. Many financial instruments available don't mean that you will end up trading leveraged futures on penny stocks. Instead, we imply that you will have different alternatives. You may be initiating with Amazon shares, but you will want to diversify later. Also, a broker with a vast product offering implies it is more important as a company (Since it has to comply with additional and different regulations, laws and directives).
Top Brokers to Trade Amazon Stock in Senegal
Step 2: Open an account
Once you have chosen the Broker you feel it's the best alternative you have, you will need to complete the account opening process. First of all, remember to double-check if the Broker does open accounts to clients in Senegal; a handful of them don't. Once you have checked that, the account opening process will feel like opening an account with your phone apps.
In most brokers, the process will be straightforward and will be completed on the same day, although in some instances, it may take a couple of days to verify your identity and financial background.
Step 3: Deposit money into your account
Once you have your trading account ready, the next stage is to make the first money deposit. The minimum amount is usually around USD 100-200, or the equivalent in Euros, Aussie Dollars or Sterling. Adding funds is usually an instant process; you will have access to your capital when you authorize the operation (excepting a bank transfer, which could take up to 3 business days).
Funding your account can be completed via credit card, debit card, bank transfer or Paypal, as well as Skrill or Neteller. Nevertheless, be aware that the Broker might charge you extra fees when using some payment methods.
This deposit will provide you with the liquidity in the account to buy the matching value in Amazon shares.
Step 4: Buy Amazon Stock
You are in the last step to be able to hold Amazon shares!
To do this, go to the Broker's search box, write Amazon (or its trading symbol AMZN) and select it. Usually, a small box called the trade order box will appear where you must complete the following details:
The number of Amazon Shares you wish to buy. The amount of shares is constrained by the capital you have deposited in the trading account.
The price at which you would like to execute the buy order if you would like the current price to drop a bit before you go in. Alternatively, you could go with the 'Market Order', which will execute the buy transaction at the current market's
Finally, complete the trade by clicking "Execute Trade", "Buy", or whatever message the order box shows. And, accomplished. Congratulations, you possess Amazon shares.
Further Step: Review your investment in Amazon regularly
Once the trade completes, it is now time to monitor it regularly. Be up to date with Amazon's news and the price's technical moves.
You will need to decide your exit strategy. In other words, the catalysts and timeframe you want to keep the position open (or closed). Are you a long term investor? a short-term trader? The previous questions are the primary consideration you have to have when thinking about your exit strategy. In the case of making a short-term trade, you will need to be aware of the news and technical movements daily, but if you want to take the long-term investment, you will need to be mindful of the essential info, such as quarterly results.
You can decide at any time what to do with your shares. Thus, you will be able to manage your trade and change it at any time according to your convenience.
If, for example, you had planned to keep the stock for an extended period, but after a few days, the stock rises a high percentage, you can decide whether to sell them at that time or continue with your investment strategy and keep it longer.
Remember to set objectives, both for-profits and losses, and ensure your capital. To do this, use the Take Profit and Stop Loss tools and adjust them according to the target price you desire to win or the maximum loss you want to bear.
Now that you've learned the required steps to buy Amazon stock, let's move on to learning about the company as an investment.
Why invest in Amazon Stock?
Investing in Amazon represents a stake in an exceptionally successful business. It went public on May 15, 1997, and the IPO price was $18 per share. In its first year, the value of these shares increased by 1000%, opening at 4 dollars and closing at almost 60. Since then, the annual growth has been double or triple digits in the vast majority of the company's twenty years of history.
There is no doubt that COVID-19 has had an enormous impact on the economy and how people relate to other people and technology. For this matter, the pandemic benefited companies like Amazon because it allows shopping while significantly reducing the risks associated with going to crowded stores. As a result, in the second quarter of 2020, sales were up nearly 42% from the same quarter last year.
That said, there are fears among investors that the COVID-19 vaccines and the end of the pandemic could cause a return to pre-pandemic buying patterns. However, this thesis is not widespread; people feel comfortable going back to their previous lifestyles. Still, Amazon sales are rooftop.
In terms of its product offering, besides the retail sales platform that we all know, Amazon also has Amazon Web Services (AWS), its cloud computing unit. AWS is still a relatively small part of the company's total revenue, but AWS accounts for the bulk of Amazon's profits.
With roughly over $10 billion in sales, AWS accounts for about 10% of total sales, which doesn't seem to be too significant. However, thanks to AWS's ultra-high gross margins, its operating income represented more than 50% of Amazon's operating income.
Pros and Cons of Buying Amazon Stock
World's Top-1 online marketplace
Almost 20 consecutive years making all-time highs in its price
A top-5 company by market capitalization in NASDAQ
Its monopolistic position faces risks of increased regulation.
Big rivalry in international markets (For example, Alibaba and MercadoLibre).
Frequently Asked Questions
Is Amazon traded on the New York Stock Exchange?
Amazon trades in New York, but not in the NYSE; instead, the Stock trades in the Nasdaq Exchange (Focused on Tech corporations).
Can Investors from Senegal invest in US Stocks?
Of course, buying shares from American companies is not limited to US citizens. So, you may purchase Amazon Shares while living in Senegal. Yet, it is crucial to check how this will affect your local tax situation.
Are Amazon shares appropriate for my investment portfolio?
Although Amazon is not the cheapest stock, there is a debate on both sides of the spectrum that Amazon will not sustain its current rate or be subject to a price and earnings contraction. Still, Amazon is a great company to own on anyone's portfolio.
Does Amazon pay dividends to its shareholders?
Amazon has never paid a dividend. Instead, the company's commitment to investors is that it creates businesses in new markets as Amazon grows, generating even more significant profits. Investors will then become more interested in buying the stock, which will increase the price.
Is it okay to buy Amazon stock if I'm new to investing?
One of the rules of investing in the stock market says that you should buy what you know: choose shares of companies that you understand and are familiar with. Picking stocks of companies with solid fundamentals or strong balance sheets is another rule. And, of course, diversifying your investments or making sure you don't put all your eggs in one stock is also a thesis we should all follow as investors.
What is the best Broker to invest in Amazon stock?
The preliminary list that we included gives you several options. They are all good alternatives. Decide based on your situation.