Academy How to trade Amazon stocks

Amazon stock - brief, description, and characteristics

One of the biggest corporations in the world, Amazon.com Inc. (AMZN), is a pioneer in cloud computing and e-commerce worldwide. The business runs an online store with a huge selection of goods, largely from other retailers, including toys, electronics, clothing, furniture, and food. It also provides streaming services for music and movies. A wide variety of clients' web applications are hosted on Amazon's cloud services platform.

When it was first established in 1994, Amazon was a web-based bookshop. However, Amazon's founder and former CEO, Jeff Bezos, had bigger plans for the company than just being an online retailer. Bezos saw Amazon as a technological business with a competitive edge in streamlining consumer internet transactions.

Seattle has traditionally served as Amazon's home headquarters. There are plans for a "second headquarters" that will open in 2023 in Arlington, Virginia.

At the time of writing (2022), Jeff Bezos is still serving in that position. For investment reasons, Amazon is categorized among consumer discretionary stocks; but, in acknowledgment of Amazon Web Services (AWS) position as a top cloud computing provider, it is also included in several mutual and exchange-traded funds focusing on the technology sector.

The company's primary opponents include traditional merchants like Walmart Inc. (WMT), eBay Inc. (EBAY), a provider of an e-commerce platform, and Alphabet Inc. and Microsoft Corp., all of which provide cloud computing services (GOOGL). In the fiscal year that concluded on December 31, 2021, Amazon reported net income of $33.4 billion on net sales of $469.8 billion.

Amazon stock performance

Shares of Amazon were made available for purchase after the company's first public offering (IPO) in May 1997. The stock of this company is traded on the Nasdaq Global Select Market and there is no dividend paid.

Amazon's market capitalization was $1.195 trillion as of September 2022. As a result, Amazon is now the fifth-most valuable firm in the world.

Amazon has 508,720,481 shares outstanding as of April 20, 2022, the most recent date of public disclosure.

Amazon has 10,174,409,620 outstanding shares after its stock split on June 3.
The AMZN stock is rather powerful. If you had invested 10 years ago, you would be seeing around 800% profit. However, the price took a 30% fall since last year.
If you had invested in 2002, when the price was below one US Dollar, you would see a staggering 14,600% profit. To put that in perspective, a 1,000 USD buy would now be a 146,000 USD lump of profit.

The company has a long-term uptrend as Amazon is one of the biggest corporations in the world with more innovations and expanding business.

Contrary to other cases, the global COVID-19 pandemic actually accelerated Amazon’s price growth as more people had to stay at home during lockdowns and ordered almost everything online. The situation calmed down as lockdowns subsided.

Trading Amazon (AMZN) with Purple Trading

To start your Amazon CFDs trading, first, you need to locate the ticker AMZN on our Purple Trading Metatrader 4 platform. To open a trade, either double-click or press the new order button and the following window will pop up.

Lot value calculation

When you open our MetaTrader 4 platform and click on the AMZN ticker, you'll observe that the minimal volume for trading Amazon CFDs is one lot (1.0). If you trade one lot, you will gain or lose 1 USD for each 1 USD the stock makes as you are buying at a 1:1 ratio (1 lot equals 1 share). For example, you buy 5 lots at 100 USD, and AMZN goes to 110 USD. Your total profit will be 50 USD (calculated as 10 USD (1000 cents) movement * number of lots/shares per the move).

The same logic applies to calculating your profit or loss when entering a short position.

Keep in mind that AMZN is quoted in US dollars, therefore if your account is in EUR or another currency, your profit or loss must be converted to EUR at the current exchange rate.

You can trade at the current market price (market execution) or utilize pending orders, (limit and stop orders). You can initiate the trade without the stop-loss and take-profit orders now and add them afterward.