How to trade Amazon stock: a complete guide
Learn all about Amazon, with information on the company’s history and share price journey, its share trading hours, and how to trade Amazon share CFDs with Capital.com.
What is Amazon?
Founded in 1994 by Jeff Bezos, Amazon is one of the largest and most influential technology companies in the world. It was started as an online bookstore, but over the years expanded to offer diverse services across e-commerce, cloud computing, digital streaming, groceries, and more.
After a period of sustained and exponential growth, Amazon listed on the Nasdaq stock exchange in 1997. Trading under the ticker symbol AMZN, the company’s share price journey has been dynamic, with a general trend of significant price growth since its flotation, along with some pronounced falls. In recent years, while a torrid 2022 caused a severe bearish run, the stock recovered strongly in 2023 and 2024.
In the 2023 fiscal year, the company’s revenue amounted to around $573bn.
What is Amazon’s share price history?
Amazon’s share price history has seen significant shifts since its IPO in 1997, when it offered shares at $18, valuing the company at around $438 million. In the early years of its listing, the share price made steady progress as the company added new product lines to its e-commerce offering such as electronics, clothing and home goods, convincing investors of its capacity for continued revenue growth.
However, 2018 marked a tumultuous year for the stock, as trade tensions between the US and China, rising interest rates and allegations of anticompetitive conduct contributed to a bearish period. That said, the share price fared better in 2019, and the stock took off in 2020 when the Covid-19 pandemic and the subsequent shift in online shopping patterns, as well as increased cloud computing demand and the continued strong performance of Amazon Prime, led to significant sales growth.
More recently, events of 2022 sent the price down again in the midst of soaring interest rates and inflation, leading to generalised shrinking markets and fears of a global recession. But late 2023 and 2024 saw recovery again for the stock, as the economic outlook improved and the company benefited from the popularity of artificial intelligence.
*Amazon stock price data from Macrotrends. Correct as of 27 March 2024. Historical price data refers to pricing at the time and doesn’t take into account the effect of stock splits.
(Past performance is not a reliable indicator of future results)
What factors might affect the Amazon live share price?
Amazon’s 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.
- General financial performance/earnings reports: Amazon's financial position, including sales performance, profitability, and margins, is a key factor that can influence its share price at any given time. Amazon’s earnings report is usually one of the most eagerly-awaited during the wider quarterly earnings season, and financial guidance along with market analysis during this key period can help you understand progress and future outlook. Positive financial results and strong growth prospects, particularly if above estimates, support Amazon's stock price, while disappointing earnings or guidance may lead to share price declines.
- Macroeconomic factors: economic indicators such as consumer spending, unemployment rates, and interest rates can impact Amazon's business operations and consumer demand for its products and services. Economic downturns or recessions may lead to reduced consumer spending, affecting Amazon's revenue growth and share price.
- Competition/market share: Amazon’s competitors include Walmart, Alibaba, and a range of other web services companies. Changes in the competitive dynamics between Amazon and its rivals can include new players in certain sectors, the emergence of disruptive technologies and changing price strategies, all of which can affect market share composition. This makes it worthwhile to have a keen eye on where Amazon sits compared to rivals across the range of sectors in which it operates.
- Innovation and product development: Amazon's ability to innovate and develop new products and features that attract and retain users is crucial for its long-term growth. For example, in the early 2010s the company capitalised on the shift to mobile advertising, serving mobile-friendly ad formats and developing new targeting capabilities, bolstering revenues and encouraging investors. It’s advisable to keep an eye on the company's ongoing investments in research and development, as well as its ability to adapt to changing consumer preferences and technological trends.
- Regulatory environment: regulatory scrutiny and government intervention can have a significant impact on Amazon's business operations and financial performance. Changes in regulations or legal challenges may impact investor sentiment and influence the company's share price.
What are Amazon’s stock trading hours?
Amazon is featured on the US Tech 100 and the stock trading hours are Monday to Friday from 2:30pm to 9:00pm (UK time). Learn all about the world stock market trading hours.
If you choose to trade CFDs, you can follow the Amazon stock performance live in US dollars with the comprehensive Amazon 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 Amazon shares with CFDs
If you want to take a position on Amazon 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 Amazon 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 Amazon 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.
The key difference between buying physical Amazon shares and trading through a derivative is the leverage that is 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. Both your profits and losses may be larger than your initial deposit, making leveraged trading risky. You can learn how to trade shares in our comprehensive guide to shares trading.
To trade Amazon 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 Amazon 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
Visit our other complete guides
How to trade Microsoft
How to trade Alibaba
