Investing can be intimidating, especially when you are dealing with your own money and there are so many different terms and platforms to choose from. However, the desire to invest in a company that you believe in can be a powerful motivator to start learning about the process.
Today, we will explore how to invest in AMD, a company that has gained significant popularity in recent years with investors from the corporate to individual level. Whether you are new to investing or have some experience, learning about how to invest in AMD can be a valuable step toward building your portfolio!
Let’s get started.
What Does It Mean to Invest in AMD?
Investing in a company is essentially acquiring a stake in that company through the exchange of money. This can be done by purchasing stocks, also known as shares, in a public company. When you own shares in a company, you own a portion of that company directly. The demand for a company’s shares can impact its price, and if the company is doing well, the value of the shares may increase, resulting in a return on the initial investment for shareholders.
In the United States, each public company offers a certain number of shares for purchase. “Investing” in AMD usually means acquiring a stake in the company to potentially see a return on your investment. There are currently 1.21 billion outstanding AMD shares available). The largest shareholders (investors) are firms like the Vanguard Group (~128 million shares) and BlackRock (~77 million shares).
How to Invest in AMD
Investing in AMD is straightforward in today’s regulated markets, especially since everything can be done online quickly. There are two primary ways to invest in AMD, both of which we will explore in this article: buying individual shares and buying into a pooled investing fund via ETFs and mutual funds.
Buying Shares Using a Brokerage Platform
Investing can easily be done by acquiring a stake (ownership) in the company and hoping to see a return on your investment. One way to do this is through the purchase of shares, which are issued by AMD as a means of fundraising, and allows investors to be connected to the success of the company.
In the United States, the exchange of shares on the public market is done on stock markets, of which there are two major ones: the NYSE and the NASDAQ. Both of these markets are regulated, and all activity is visible to the public. The stock market is one of the oldest methods of investing in a company, and investing in AMD through these markets is easy, with various online platforms providing immediate access.
Accessing these public markets is generally done through a specialized account known as a “brokerage account” or “brokerage platform.” Nowadays, these accounts and platforms can be used by simply creating an online account, adding funds, and then purchasing shares of the stock you are interested in.
Some of the most popular brokerage platforms include:
- Fidelity Investments
- TD Ameritrade
- Merrill Edge
Make sure that you do your own research in order to best choose which platform is best for you. Some are much more user-friendly than others but don’t allow for advanced trading capabilities (see Robinhood). Additionally, some platforms offer “managed” accounts, where a financial advisor invests your funds on your behalf for a percentage fee (see Merrill Lynch, Fidelity, and more).
Once you’ve opened an account and added funds, simply look up AMD on the platform and purchase as many shares as you want.
Currently, AMD is trending around the $68 mark, meaning that an investor would need at least that much to purchase a single share. Additionally, an investor could purchase 14 or so shares of the company for around $1,000, and so on.
Buying ETFs and Mutual Funds
Another method of investing in AMD is through “pooled” or “shared” investment funds. Two of the most popular options include ETFs and mutual funds. ETFs and mutual funds are large funds of pooled money with ownership of multiple assets. For example, a mutual fund with a focus on “energy” would be made up of bundled company shares, such as ExxonMobil, Shell, and Chevron. When you purchase shares of a mutual fund, you aren’t owning the shares of the companies directly, but owning a share of the pool that owns them.
Why buy a mutual fund or ETF? Well, they are inherently less risky and generally more stable. Instead of a single company influencing an investment, the fund is made up of multiple companies. If one is doing poorly while the others are relatively stable, your portfolio won’t be negatively impacted. At the same time, however, this makes the potential upsides a bit less since the positive growth of a single company wouldn’t swing the pooled funds dramatically all on its own.
There is a nearly endless supply of mutual funds and ETFs with various compositions that incorporate AMD shares within it. Here are some of the most notable ETFs that include AMD:
|Notable ETF Marker||Fund Name and Description||Ticker|
|Most AMD Exposure (the Most Influenced by AMD)||Esoterica NextG Economy ETF with a 9.38% AMD share allocation||WUGI|
|Top Performing ETF with AMD||Simplify Volt Cloud and Cybersecurity… with a 5.77% 30-day return.||VCLO|
|Most AMD Shares Overall||Invesco QQQ Trust with 23.45 million shares||QQQ|
Although AMD is a large company, it is super easy to invest in it. As long as you understand your reasons for investing and have the funds and platform to do so, it should only take a few minutes.
Here are a few things to remember:
- Direct stock ownership is usually what is meant by “investment” in a company.
- Owning company stock correlates to direct ownership of the company itself.
- Using a brokerage platform allows you to buy direct shares or buy shares of a pooled fund like an ETF or mutual fund.
- Different brokerage platforms allow for different things. Make sure you know which is best for you.
- Buying AMD stock ties your money to the success of the company, while a mutual fund or ETF is a less risky but more diluted way of investing in the company.
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