How to Buy Google Stock (GOOGL) – Forbes Advisor

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Google is much more than a search engine. As part of its parent company, Alphabet, Inc., Google has grown into one of the largest technology companies in the world, with cloud computing, software and more.

Its stock price has risen alongside its rapid growth. From early January 2021 to the same period a year later, GOOGL’s share price increased by more than 50%, and in the third quarter of 2021, the company recorded a 41% increase in revenue by a year to year.

If you’re wondering how to snag some of that growth for your portfolio, here’s everything you need to know about buying Google stock.

1. GOOG vs. GOOGL: what’s the difference?

Before you get too far into buying Google stock, you must first decide what kind of Google stock you want to buy. It’s true. Stocks of Google, or rather its parent company, Alphabet, Inc., come in two main flavors: GOOGL and GOOG.

The difference between them is whether the shares have voting rights. GOOGL is what is known as a Class A common stock, which gives its shareholders the ability to vote on corporate matters. GOOG, on the other hand, is a Class C stock and does not come with voting rights. Both classes benefit from appreciation in value, just like any other stock.

(There’s also a class B share of Google that has super-voting powers – 10 votes for each class A share. These are held almost exclusively by Google founders Larry Page and Sergey Brin and the ex -CEO Eric Schmidt to keep control of the company, so you’re unlikely to have the chance to buy a stock.)

As you’d expect, its extra voting rights mean GOOGL can trade at a premium to GOOG. Since the split in 2014, however, their prices have been quite similar, and perhaps more importantly, the percentage increase in share value has been nearly identical. This means that you will ultimately decide whether you want to have a token voice in Google’s business or not.

2. Select a brokerage

If you don’t already have an investment account, you’ll need to open one at a brokerage or with an investment app. To speed up your research, check out our list of the best online brokers and the best investing apps to find quality choices with low investment minimums and fees.

You’ll also want to make sure you choose a brokerage with the right type of account for your needs. While nearly all have tax-advantaged, tax-advantaged retirement accounts, like Individual Retirement Accounts (IRAs), 529 accounts that help you save for the kids’ education are less common among investing app startups.

3. Decide on an initial investment

Because you probably can’t afford a full share of GOOG or GOOGL, at least not right away, you’ll need to decide how much (and how) you want to invest. Ask yourself these questions to determine your ideal initial investment.

  • What is your budget ? If you don’t have enough to cover expenses and save for retirement and emergencies, you might want to put off buying Google stock. Once you have them under control, you can invest the remaining funds in Google stocks.
  • What is Google’s price? GOOGL and GOOG are trading in the thousands of dollars per share, reaching just over $2,700 in early January 2022. Fortunately, many brokerages now allow you to buy what are called fractional shares which give you a part of the ownership of an individual stock. However, not all do, so make sure yours does if you plan to invest this way.
  • What is your investment strategy? You can choose to invest a lot of money at once or slowly acquire the property over time with small, regular purchases. This latter strategy, called average dollar buy, can help you pay less per share on average over time. But more importantly, it gets your money into the market as quickly as possible. Remember: time in the market is often more powerful than market timing.
  • What other investments do you have? As an investor, you have probably built or will build what is called a portfolio. This means that your Google investment will complement other holdings, such as stocks in other companies or maybe even some bonds or funds. Consider how Google (and the type of business Google is) fits into your overall investment environment.

4. Examine Google’s performance

Before you buy your GOOG or GOOGL stock, you’ll want to research the company’s financials to get an idea of ​​its performance, risks, competitors and future plans.

As a publicly traded company, Google submits quarterly and annual filings, known as Form 10-K and Form 10-Q respectively, to the United States Securities and Exchange Commission (SEC). You can view these documents on Google’s Investor Relations site or by searching the SEC database.

To help you navigate this information, you can turn to expert analysis, such as that available on Morningstar and Forbes or even your brokerage platform.

5. Place your order

When you have opened an account and deposited money to invest, you can buy shares by entering the stock symbol of the company (GOOGL or GOOG) and the dollar value you wish to invest or the number of shares you want to buy.

Most brokers allow you to place market orders, where you buy or sell stocks at the current price. Or you can place a limit order and set a specific price to buy and sell the shares.

Google trades on the Nasdaq exchange, which means you can buy and sell stocks between 9:30 a.m. and 4:00 p.m. ET Monday through Friday. Your brokerage may also offer extended trades before or after business hours.

6. Examine the performance of your investment

Even with a stock like Google, you don’t want to set autopilot and never see your investment again. You will need to check back periodically to make sure it is helping you make satisfactory progress towards achieving your goals.

To see how your investment stacks up against the rest of the market, you can compare Google’s performance to that of a benchmark index, like the S&P 500. You can also track its financials using the same documents with which you have done your preliminary research.

When you’re ready to sell your Google shares, the process is as easy as buying your shares. Simply log into your broker’s trading platform and enter the stock symbol and number of shares or dollar amount you wish to sell.

If you’ve seen significant increases in value, you may want to meet with a tax professional before selling your Google stock. They can help you develop strategies to minimize any capital gains tax you may incur.

Investing in any individual stock, even Google, is a risky bet. That’s why financial advisors recommend a diversified approach that involves investing in dozens or even hundreds of stocks. One of the easiest and cheapest ways to do this is through index funds and exchange-traded funds (ETFs) that seek to duplicate the performance of major stock indices, like the S&P 500. These funds offer exposure to hundreds of investments in a single stock.

Fortunately, Google is easy to find in many index funds. It occupies about 7% of Nasdaq 100 funds and 4% of S&P 500 funds.

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