The cheapest way to buy Facebook/Meta Platforms (META) stock is with a good broker and plan. In this guide, I’ll show you exactly how to put it all together.
Buying META shares might seem like a daunting process — especially if you’re a newer trader. That’s why we’ve written a step-by-step guide to walk you through the process and help you understand the most affordable way to buy Facebook stock.
If you look at Facebook’s chart, you might think it isn’t cheap anymore. I like to say that the best time to start trading was 20 years ago — but the second best time is today.
Let’s get into it…
Table of Contents
- 1 How to Buy Facebook Stock (NASDAQ: META)
- 2 Should You Buy Facebook Stock?
- 3 One Platform. One System. Every Tool
How to Buy Facebook Stock (NASDAQ: META)
Here are five simple steps to buy Facebook stock.
1. Open a Brokerage Account that Lets You Trade Facebook Stock
Any U.S. broker should let you trade Facebook stock. In addition to letting you trade Facebook shares, a good broker will provide educational materials, research tools, and quick executions.
Pay attention to commissions and fees when choosing a broker. This may be the difference between a profitable trade and a losing one.
I give some good tips on choosing a broker in this video:
One of my top criteria for choosing a broker is their trading platform. I use StocksToTrade, which will let you trade with the most popular brokers.
StocksToTrade has assembled the best charts, the most versatile screeners, the most probing news scanners, and more to create a one-stop trading machine. I think it’s the best way to trade.
2. Decide on Your Investment Goals and Risk Tolerance
Are you saving for retirement? Or are you looking for short-term returns?
Trading Facebook stock has to fit your investment goals. Hitting your goals is why you’re trading in the first place!
Facebook stock is what is called a “growth stock.” It’s a sector leader and projects to keep growing…
But it can be volatile too. That’s not great if you can’t afford to lose some or all of your investment.
3. Do Research on Facebook Stock
There are two main types of research you can do on a stock: fundamental and technical analysis. Some traders and investors use one type of analysis more than the other, but both are important to understand:
- Fundamental analysis involves looking at the value of the company and stock. This can involve looking at the company’s financial reports, revenue, dividends, and fundamental indicators like price-to-earnings (P/E) ratio. These fundamentals help you understand the underlying value of the stock, which may eventually be reflected in the stock’s actual price.
- Technical analysis involves looking at a stock’s chart. Chart patterns can help you identify trends that fly under the radar, and find trading opportunities that others don’t see.
In addition, you should keep on top of Facebook news, as well as sector and macro-economic developments.
Upcoming events like product launches or earnings reports can massively affect a stock’s value. Larger pieces of news or developments that affect the company or sector can also be powerful catalysts.
4. Build Your Facebook Stock Trading Plan
A trading plan will help you focus on your goals, and avoid impulsive moves. Your trading plan could be long-term or short, but it should always focus on your goals.
A good trading plan should include:
- Entry. The price you want to buy Facebook stock at.
- Risk. The amount of money you’re willing to risk losing.
- Goal. The amount of money you want to make on your trade.
Here’s my guide to building a trading plan.
If you’re investing, your goals and risk will be different. They may be for your position to grow by a certain percentage each year…
Even if you’re intending to hold Facebook stock long-term, I think you should still have a clear risk outlined to safeguard your gains. You can always buy more Facebook stock — as long as you still have the money to do so!
5. Place Your Facebook Stock Order
Once you have a good plan, it’s time to put it into action by placing your Facebook stock order.
There are a few steps to this:
- Place a buy limit order. You should always place limit orders, as opposed to market orders. This way you’ll be sure that your actual entry matches your trading plan.
- Set a stop-loss. You should always have a stop-loss set, even if it’s just mental. I recommend a physical stop-loss if you can’t watch the market every day.
- Follow your trading plan. It’s tempting to adjust your trading plan on the fly. But a wishy-washy trading plan is a poor foundation for sustainable success.
Should You Buy Facebook Stock?
You should buy Facebook stock if it fits your investment goals, and your research indicates that there’s an opportunity.
META’s value has climbed nearly 120% through the first five months of 2023. It’s learned how to use AI to replace the data tracking it had used to deliver effective ads. This could be a very good sign for the future.
Pros of Buying META Stock
There are a number of advantages to buying Facebook stock.
- The Social Media Leader: Social media is one of the biggest ad engines in the world. Between Facebook, Instagram, and Whatsapp, Meta Platforms is the biggest name in the sector.
- The Metaverse Could Still Be a Thing: If social media becomes a virtual reality space, Facebook has a head start. It believes in it so much it changed its company name to Meta Platforms.
- TikTok Could Be Banned: Both sides of the U.S. government seem to agree that allowing Chinese software on American phones could be dangerous. If more bans happen, Facebook stands to gain.
Cons to Buying META Stock
Here are the cons you should weigh when making this decision…
- Regulatory Concerns: Government regulators have had Facebook in their sites for years now. The latest salvo is a California law that aims to have Facebook pay for sharing news stories.
- It Isn’t Cool Anymore: If user engagement goes down, so does ad revenue.
- The Metaverse Might Not Become a Thing: The company’s strategic shift towards the metaverse hasn’t come to much so far, and there’s no guarantee it will in the future.