Snapchat is the fastest growing social network among young people, and large technology companies are beginning to fear (and a lot) the progress of this company. In today’s article, you will learn how and why to buy Snapchat shares and stocks.
Is it Time to Buy Snapchat Shares?
This is the most difficult question to answer (and the most important, of course). When should you invest in a company? Well, logically, when your shares are cheap. And, as that varies over time, it is better to explain how to value it yourself than to tell you if they are expensive or cheap right now.
To value the actions of Snapchat (or any other company), you must use technical analysis and fundamental analysis.
The technical analysis will help you know when to enter the market because it allows you to analyze the evolution of the stock price and forecast what the next move will be.
Instead, in the fundamental analysis, it will help you determine which shares to buy, based on the evolution of the company, how the competition is doing it, etc. That is why mixing both types of analysis will offer you an advantage over those who only use one of the two.
How to Win on Falls
CFD brokers offer the ability to sell stocks you don’t have to buy back later. In this way, if you believe that the price is going to drop, you can sell a share expensive and buy it back when it is cheap.
But there would be another question left unanswered: Why would you want to sell shares? Isn’t it better to buy and have them? And the answer is … it depends. It depends on what the share price is going to do.
Imagine that the share price ranges from € 12 it was worth in November 2017 to almost € 20 it was worth in February 2018. But, in between, there is a rise to € 16 and a fall to € 13.
It is evident that buying a share in November 2017 and holding it until February 2018 is a round business with around 70% appreciation.
But you would have greatly increased your profitability if you had sold on the first raise up to € 16, you had gone short to € 13, and you had bought back until the new peak of € 20.
Obviously, controlling the times so well is difficult, but it is for you to understand that selling shares can be a good idea to also win in the falls (and you will buy when it raises again, which are not two mutually exclusive options).
How and where do I buy the shares?
When buying Snapchat shares you have different options (after all, any bank allows you to buy shares through their broker). However, for us, the best option is to do it through CFDs.
CFDs are slightly more complex instruments than simple stocks, but they have the advantage that they allow you to win on falls by shorting and that they allow you to leverage, that is, invest up to € 300 with just € 1 of real investment.
That is why, although they are products a little more complex than simple actions, they are a very profitable option if you want to have the aforementioned advantages.
Snapchat’s Main Competition
Snapchat is currently one of the most popular social networks in the world. However, despite having successfully won the hearts of its users, the company remains a strong rival to other large companies. It is essential that you know the competition of Snapchat before starting to operate with your shares, so we want to offer you a world ranking of the largest social networks in terms of number of users.
Facebook is, of course, number one with over 2 billion active users per month, as of 2017.
Youtube is in second place with 1,500 million users per month.
WhatsApp ranks third with 1.2 billion users per month.
Google Hangouts is the fourth with 1,000 million active users per month.
WeChat ranks fifth with 889 million monthly active users.
The Chinese company Tecent QQ occupies the sixth place with 877 million monthly users.
Instagram is seventh with 700 million active users per month.
Google + ranks eighth with its 359 million users per month.
Twitter is the ninth with 328 million users each month.
Lastly, Snapchat ranks 10th worldwide with 300 million active users per month.
The Main Snapchat Partners
In 2014 Snapchat partnered with Square, a company specializing in smartphone payments, as part of a strategic partnership.
In 2017, the French bank BNP Paribas established a marketing partnership with Snapchat to strengthen its presence on social media in an attempt to modernize itself in the eyes of young active people.
Still in 2017, entertainment giant Time Warner announced an investment of more than $ 100 million in content and advertising on Snapchat.