Alphabet is a parent company of Google, the most popular and used search engine in the world. The company is headquartered in Mountain View, California, and is not only holding Google but has other businesses and products, including YouTube, Access, Blogger, Waymo, CapitalG, Chronicle, GV, Nest, Verily, and Google X. Alphabet is known as the most defensive company of the ‘FANG’ (or FAANG) stocks, a term that refers to the most popular US technology companies including Facebook, Amazon, Apple, Netflix, and Google.
In this guide, we show you how to buy Alphabet (GOOGL) shares in the UK, whilst also analysing Alphabet’s share price history.
If you want to buy US shares like Alphabet Google, you will need to use a UK stockbroker that gives you access to US shares listed on the NASDAQ stock exchange. Alphabet is a highly-traded share and as such, most brokers allow you to trade this share.
With that in mind, choosing the right broker is crucial, since it will have a strong impact your trading success. You’ll need to find an FCA-regulated broker that enables you to buy shares of Alphabet and maintain low trading commissions. To help you find the right broker for your needs, let’s take a look at two of the most popular UK share dealing platforms.
eToro is an online broker offering clients to trade on forex, commodities, indices, cryptocurrencies, and many of the most popular shares. This broker provides a user-friendly way of buying Alphabet shares online. Registering a trading account with eToro can be completed digitally, with a minimum deposit of $10 (£7.60).
eToro is one of the largest social trading platforms in the world, allowing investors to utilize a range of social trading tools and features. The CopyTrade and CopyPortfolios are some of eToro’s tools that enable you to automate your investments. This essentially means you can copy the trades of other users or choose built-in portfolios that bundle together different assets based on a particular market or region.
One of eToro’s most populear features is its fee structure. You can trade shares on its platform with 0% commission, and the spreads are competitive with other brokers. The other fees you need to consider are an inactivity fee and a flat $5 charge on withdrawals. The broker also allows fractional trading, meaning you can buy a portion of a share that is less than one full share.
When it comes to regulation, eToro is fully regulated by the UK’s Financial Conduct Authority and protects clients’ funds as all accounts are secured by the Financial Services Compensation Scheme (FSCS).
|Stock Trading Fees||0% commission + spread|
|Deposit Fees||No (0.5% conversion for non-USD deposits)|
|Withdrawal Fees||$5 (£4) per withdrawal|
|Inactivity Fees||$10 (£7.60) per month after one year|
|Monthly Account Fees||No|
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Since its foundation in 2008, Plus500 has made a name for itself in the online space by offering free trade commission on its online trading platform. If opting for Plus500, you can trade hundreds of shares from various exchanges through CFDs – including shares of Alphabet. This UK-based broker offers a spread of 1.25 or 0.08% when trading Alphabet shares and the minimum amount required to make an investment is 0.5 shares. Moreover, you will be able to trade with a leverage of 5:1 on shares like Alphabet.
On this platform, investors can also take advantage of numerous features including an advanced charting package, a plethora of risk management tools, an economic calendar, and a price alerts service. In order to get started, Plus500 maintains a minimum deposit requirement of £100, which you can do via a bank wire transfer, credit/debit card, or Paypal. If you would like to test the platform, you can open a demo trading account for free, with virtual money.
|Stock Trading Fees||0% commission + spread|
|Inactivity Fees||$10 (£7.60) per month after three months|
|Monthly Account Fees||No|
Sponsored ad. 72% of retail investor accounts lose money when trading CFDs with this provider.
Alphabet shares are a popular option to consider, whether it is for a long-term investment or as an asset for day trading activity. It is currently trading near historical highs and the fundamentals indicate that the most recent correction caused by the Covid-19 pandemic meant that Alphabet’s P/E ratio took a hit. Nevertheless, it’s crucial that you have more information about the company and its share performance to make an educated investment decision.
Alphabet is a huge, diversified, and strong company that became the parent company of Google and several other companies in 2015. Alphabet reserved Google Inc.’s share price history and the share still trades under the ticker symbol GOOG and GOOGL. The reason why Google has created two classes of shares; Class A Shares (SYMBOL: GOOGL) and Class C Shares (SYMBOL: GOOG), is because the company’s founders, Larry Page and Sergey Brin, clearly had an intention to retain primary control of the company.
Google’s IPO took place on August 19, 2004, at a price of $85 per share. Since then, the share has been on a long uptrend, and on September 02, 2020, it reached an all-time high of $1717.39. More importantly, Google’s parent company has joined the trillion-dollar companies club in January and is the fourth American company to hit a market cap of $1 trillion.
At the time of writing in September 2020 – Alphabet’s share price is $1547.23. The YTD return for Alphabet now stands at +16.37%. The company’s Forward P/E ratio of 34.06 implies that investors still have high expectations for future growth, mainly due to the recent positive earnings report released in July.
As of 2020, Alphabet has never paid a dividend to its shareholders. Google is a growth company and its management had declared several times that earnings should be retained and used to grow the business further.
During times of uncertainty in the market, investors will look for shares that are resilient to an economic recession. Google’s search ads service would be the most resilient income for Alphabet during a recession, however, we must mention that Alphabet shares dropped nearly 40% between February to March when the coronavirus panic escalated in the US and around the world.
Nonetheless, given the high volatility and uncertainty in the stock market right now, it is crucial to identify high-quality profitable companies that have the strength to overcome an economic slowdown. To help you make the right decision, below you will find some of the factors to consider when researching Alphabet shares:
Google is Dominating the Digital Advertising Field
Google, along with Facebook, dominates a combined 70% of the digital advertising market in the United States. Google’s search engine controls over 90% of the global market share and 87% of the US market.
In 2019, Google was responsible for the majority of Alphabet’s revenues with an annual income of $160.74 billion. The majority of Google’s revenue of $134.81 billion, as expected, comes from its advertising service.
Waymo Leads the Self-Driving Car Race
Alphabet also owns Waymo, which is an American self-driving driving technology development company actively working toward making the first fully autonomous car. As of September 2020, Waymo ranks behind Tesla in the self-driving race.
Google is Also A Dominant player in the Cloud Computing Market
Google is also the third-largest provider of cloud computing services behind Microsoft Azure and Amazon Web Services (AWS). Google’s cloud computing service can be another solid income for the company as cloud services have high revenues with relatively low expenses.
Step 3: Open an Account and Deposit Funds
If you still want to buy Alphabet shares after you’ve done your research on the company and its share price performance, you’ll need to open a brokerage account at a UK dealing platform. To help you get started, we’ll show you how to open an account and place orders in the market for GOOGL shares.
The first thing you need to do is to navigate to the broker’s website and choose ‘Join Now’ on the homepage.You may also be asked to enter your full name, email address, date of birth, nationality, and national insurance number.
FCA regulated brokers tend to ask that all clients must verify their identity before they can deposit funds. Therefore, you will be required to verify your identity by uploading a copy of your driver’s license or passport and verify your proof of residence by uploading a recent utility bill or bank account statement.
As soon as you are verified, you can make a first deposit to your account. Most brokers will have a minimum investment amount that must be matched to start trading and will accept one of the following:
- Debit Card
- Credit Card
- UK Bank Transfer
Now that you have funds in your account, you are ready to buy Alphabet shares. To place your first order, log into your broker’s trading dashboard and search for Alphabet or GOOGL in the search box.
An order form should then appear, in which you will need to set up a ‘market order’ to buy the share immediately. You also need to insert the amount you wish to invest in Alphabet shares and then click on the ‘Open Trade’ button to complete the purchase.
Note: If you are buying Alphabet shares outside of standard market hours (9.30 am to 5 pm, Eastern Standard Time), you will need to click on ‘Set Order’. Your Alphabet shares purchase will then be completed when the markets open.
Ultimately, the decision to buy or sell Alphabet shares rests with you, so it’s important to do your own research.
In terms of the fundamentals, there’s many analysts remain bullish on Alphabet. Google’s free cash flow stands at 17.4% and its 5-year average ROCE is currently 14.9%. Ultimately, these figures indicate that Alphabet is a defensive stock, but at the same time, it may have significant growth potential.
In simple terms, short selling stocks is a trading method in which an investor is betting against a stock. Essentially, you initially borrow shares from your broker and then sell them to another investor with the goal of buying them back at a lower price.
Many brokerage firms in the UK have restrictions placed on short-selling trading. You may have to use an authorized CFD broker that enables you to short sell shares in a legal manner.
Really, there’s no need to need to introduce Google. It is one of the largest companies in the world and its search engine is one of the most profitable products ever invented. But Alphabet is much more than just Google as it owns and operates a line of businesses that include Waymo, X Development, CapitalG, YouTube, Waze, Nest, DoubleClick, and many more. As such, it remains one of the most popular shares to buy in the market.
Looking to invest in other tech shares? Check out the companies below.
- Micron Technology