Apple is one of the most successful and valuable companies in the world and most investors would want to take a bite. How does one invest in this company? This article provides a definitive guide to investing in Apple, the specific options available to investors, and the processes involved in each option.
Taking a Bite: A Definitive Guide to Investing in Apple for Beginners
Investing in Apple can be an appealing option for beginners who want to gain exposure from the tech sector and even for intermediate investors aiming to expand their investments with the inclusion of large companies in their portfolios. It is assuring to know that the company offers two general options for investments: through stocks and bonds.
Apple stock has remained one of the most appealing large-cap stocks in the stock market because of its strong track record. The bonds that the company offers might not be as popular as its stocks but they are also an interesting option for those with a more conservative appetite. Those who want to invest in Apple should know how and where to buy either of these two.
How to Invest in Apple through Stocks
There are two routes in stock investing. These are through active investing and passive investing. Active investing involves direct purchasing of shares of issuing companies via a broker or through investing in a specific basket of funds or pooled fund such as a mutual fund, exchange-traded fund, unit investment trust, or even a unit-linked insurance plan.
Below are the steps to invest actively and directly in Apple stocks:
• Find a Broker and Open an Account: There are different stock brokers to choose from and most of them have gone online with online-enabled trading platforms. Some of the most popular brokers in the United States include Vanguard, Fidelity, Robinhood, eToro, Charles Schwab, and Interactive Brokers, among others.
• Fund Your Account and Place an Order: A brokerage account can be funded via bank transfer or direct check deposit. Most online platforms also accept credit card payments. A funded account can be used to place an order. Look for the “AAPL” ticker symbol and select the number of shares and the type of order.
• Monitor and Maintain the Account: It is important for an investor to monitor his or her brokerage account regularly to track the performance of specific investments and make buying and selling decisions. Information about Apple can also be obtained from other sources such as news and official company releases.
Below are the steps to invest passively and indirectly in Apple stocks:
• Choose the Specific Type of Pooled Fund: There are different types of pooled funds. These include mutual funds, unit investment trusts, exchange-traded funds, and unit-linked insurance plans. An investor must weigh the pros and cons of each to determine the best type of pooled fund suitable for his or her needs.
• Look for a Financial Services Provider: Most stock brokers in the U.S. offer mutual funds and exchange-traded funds. Some life insurance companies offer unit-linked insurance plans. Approach an authorized representative of the chosen company, complete the paperwork, and open a pooled fund account.
• Determine the Suitable Type of Funds: There are different types of funds within each pooled fund. These include equity fund that includes stocks of top companies, and mixed or balanced funds that include a mix between equities, bonds, and other instruments. Ensure that the chosen fund holds Apple stock.
Active investing and passive investing have their respective pros and cons. Active investing requires a hands-on approach or the expertise of a portfolio manager. All pooled funds are passive investments but some are also actively managed because they involve regular buying and selling activities as opposed to the buy-and-hold approach of passive investing.
How to Invest in Apple through Bonds
Investing in Apple bonds also requires going through a brokerage firm that offers bond trading services. Most brokers also have online platforms for quicker and hassle-free transactions. The overall principle is similar to buying stocks and includes opening a brokerage account, funding the account, placing an order, and monitoring the performance of the bond.
Several notable brokers that offer both stocks and bonds include Fidelity, Charles Schwab, Vanguard, and TD Ameritrade. Other notable brokers that offer bond trading services include Interactive Brokers, TradeStation, and Magnifi, among others.
Investing in Apple bonds can also be done through indirect and passive investment routes. Most pooled funds also have bond funds or mixed and balanced funds that include stocks, bonds, and other assets or instruments. Make sure that the chosen type of pooled fund and its specific type of fund include Apple bonds in its composition.
Below are important reminders before you invest in Apple bonds:
• Learn the Bond Market: It is important to understand the basics of the bond market. This includes understanding how bonds work, their different types, and how they are traded. This will help you make informed decisions and manage risks.
• Creditworthiness of Apple: Research the creditworthiness of Apple. You should check and analyze the financials of the company, its credit ratings, and debt levels to evaluate its capabilities to pay its debts and interest payments.
• Determine Your Purpose: It is also important to ensure that your investment goals and objectives are aligned with what Apple bonds can offer. You should be able to answer pertinent questions that will guide your investment decision.
• Choose the Right Bond: Take note that Apple issues different types of bonds with varying maturity dates and interest rates. Choose the bond that best aligns with your investment purpose or goals and objectives and risk tolerance.
• Look for a Reputable Broker: You will need to work with a reputable broker that offers access to the bond market and offers Apple bonds. Choose a broker with a good track record of customer service and reasonable or competitive fees.
• Monitor the Investment: It is important to monitor the performance of your investment. This includes changes in the creditworthiness of Apple, the overall condition of the bond market, and factors that can affect the value of your bonds.