How to trade Alibaba: a complete guide

Learn all about Alibaba, with information on the company’s history and share price journey, its share trading hours, and how to trade CFDs on Alibaba shares with Capital.com.

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What is Alibaba?

Founded in 1999 by Jack Ma, Alibaba is a Chinese multinational technology company. The company was started to facilitate the process of connecting global businesses with Chinese manufacturers and thus enabling seamless cross-border trade. However, it has since broadened its scope to offer services ranging from e-commerce to cloud and digital media.

The company built towards a 2014 New York Stock Exchange listing that saw it raise $21.77 billion in one the largest IPO ever at the time, valuing the business at some $231 billion. Trading under the ticker symbol BABA, the company’s share price journey has been dynamic. There was steady price growth until 2021. However, the company suffered a torrid 2021 following penalisation from Chinese regulators.

In the 2023 fiscal year, the company’s revenue amounted to around $126bn.

What is Alibaba’ share price history?

Alibaba’s share price history has seen significant shifts since its IPO in 2014. Following the hype surrounding the largest-ever global IPO at the time, the stock made steady progress, particularly in 2017 when its acquisition of e-commerce group Lazada and video hosting service Youku Tudou contributed to strong top-line growth. Investor interest was also boosted by Alibaba’s investments in such diverse offerings as supermarkets, movie production and a car technology start-up. Despite the Covid-19 pandemic, 2020 was also a bullish year as online shopping grew in popularity.

However, 2021 proved to be tumultuous as Chinese regulators tightened oversight of the tech sector, leading to regulatory uncertainty and suppressed investor sentiment. This resulted in an almost 50% decline in market capitalisation over the year. Since this event, the Alibaba price has been trading in a range between around 70-100HKD.

*Alibaba stock price data from Macrotrends. Correct as of 27 March 2024. Historical price data is inclusive of the effect of stock splits.

Past performance is not a reliable indicator of future results

What factors might affect the Alibaba live share price?

Alibaba’ share price can be impacted by a range of key sector-specific fundamental events. Here are a few of the main factors that traders should watch out for.

  • Chinese regulatory environment: domestic regulators and government can have a major effect on Alibaba. Changes in regulations related to e-commerce, antitrust, data privacy, and other areas can affect the company’s market position, profitability, and growth prospects. As mentioned, Alibaba’s share price fall of 2021 saw increased scrutiny on the company’s business operations, resulting in an uncertain investment climate that depressed the stock.
  • Financial performance/earnings reports: Alibaba's financial position, including sales performance, profitability, and margins, are key factors influencing its stock price. The company’s quarterly earnings reports and financial guidance, along with market analysis, can help traders understand progress and future outlook. Positive financial results and strong growth prospects, particularly if above estimates, support Alibaba's stock price, while disappointing earnings or guidance may lead to share price declines.
  • Competition/market share: Alibaba faces extensive competition across e-commerce, cloud computing, digital finance, and logistics. Rivals such as JD.com, Tencent, and Pinduoduo are all capable of making strategic decisions that boost their revenues and increase their market share, in turn making Alibaba stock less appealing. For this reason, traders should be aware of the performance and innovation of the key rivals.
  • Geopolitical risks/trade relations: geopolitical tensions, trade disputes, and diplomatic relations between China and other countries, particularly the US, can affect investor sentiment towards Alibaba and Chinese stocks in general. Escalating tensions or trade conflicts may increase regulatory risks, disrupt supply chains, and impact Alibaba's international expansion efforts, influencing its stock price.
  • Global economic conditions: macroeconomic factors such as GDP growth, consumer spending, and trade dynamics, can all affect Alibaba's business performance and stock price. Economic downturns or recessions may reduce consumer demand and advertising budgets, affecting Alibaba's revenue and profitability. Conversely, periods of economic expansion and rising consumer confidence may benefit Alibaba's e-commerce and digital services businesses.

What are Alibaba’ stock trading hours?

Alibaba’ stock trading hours are Monday to Friday from 2:30pm to 9:00pm (UK time).

If you choose to trade CFDs, you can follow the Alibaba stock performance live in US dollars with the comprehensive Alibaba share price chart.

Monitoring the company’s activity can help you to keep an eye out for any key fundamental or technical events that may affect short-term movements in the share value.

How to trade Alibaba shares with CFDs

If you want to take a position on Alibaba shares, you have two options. First, you can buy physical shares in the company through the exchange on which it’s listed. In this case, investing in Alibaba stocks means you will own a share, or shares, in the company. This can be considered a long-term investment, as you’re hoping for the price to rise over time.

Alternatively, you can trade a derivative product such as a contract for difference (CFD) on the underlying Alibaba stock market price, and speculate on its price movements without actually owning the asset. A CFD is a financial contract, typically between a broker and a trader, where one party agrees to pay the other the difference in the value of a security, between the opening and closing of the trade.

Unlike physical share ownership, you can either hold a long position (speculating that the price will rise) or a short position (speculating that the price will fall). This is considered a short-term investment or trade, as CFDs tend to be used within shorter timeframes.

Another key difference between buying physical Alibaba shares and trading through a derivative is the leverage that can be employed with the latter. CFDs are typically traded on margin, which means that a trader has exposure to larger positions with a relatively small outlay. This is also known as leveraged trading, which is risky due to both profits and losses being magnified. You can learn how to trade shares in our comprehensive guide to shares trading.

To trade Alibaba stock CFDs with us, just sign up for a Capital.com account, and once you’re verified, you can use our advanced web platform or download our intuitive yet easy-to-use app. It’ll take just a few minutes to get started and access the world’s most-traded markets.

Why trade Alibaba CFDs with Capital.com

Trading CFDs with Capital.com means you’ll enjoy an intuitive, supremely easy-to-use platform, 24/7 support, fair and transparent pricing, along with award-winning education to help build your experience in the markets.* You can seamlessly integrate our smart platform with elite third-party software TradingView and MT4, and refine your strategies with our risk-free demo.

*Awarded best-in-class for education at ForexBrokers.com’s 2024 Annual Awards

FAQs

Who owns Alibaba?

The ownership of Alibaba comprises institutional, retail and individual investors. Founder Jack Ma retains a significant ownership stake, while the largest single shareholder is Japanese financial operator SoftBank Group. Goldman Sachs also holds a stake in the company.

How much are Alibaba shares?

As of 28 March 2024, Alibaba’s stock was priced around 70HKD a share, but as with any asset the market price is dynamic and liable to change at any time. If you’re trading this stock, it’s important to check the Alibaba chart frequently to keep on top of price movements, as well as retain a strong understanding of the fundamental and technical influences that can cause the price to shift.

What market is Alibaba listed on?

Alibaba has been listed on the New York Stock Exchange since its record-breaking IPO in 2014 in which it raised $21.77 billion, valuing the business at some $231 billion.

How to trade Alibaba shares

If you want to invest in Alibaba, you can buy and own the physical share, for example through a stockbroker, at a price you think you can profit on in time. Alternatively, trading a derivative, for example through a CFD, can give you leveraged exposure to the underlying price without ownership. However, leverage means that you may stand to lose more than your initial deposit.

Is Alibaba a good stock to buy right now?

Whether Alibaba is a good stock to buy is dependent on market conditions and the individual judgement of traders. On a technical level, you might consider technical indicators such as the RSI or MACD to identify potential support and resistance. From a fundamental standpoint, the standing of competitors, earnings release timings, and the regulatory landscape are all key factors that could influence your buy or sell decisions.

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