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Amazon is one of the biggest companies in the world. In fact, it is so big that it can be accurately stated to be the third biggest in the world.

Most companies are in a constant flux of where they rank relative to the others. Once you are in the top ten biggest in the world though, you do not move much.


Amazon logo

This becomes a blessing and a curse at the same time.

The obvious upside is that each share of Amazon is supremely valuable. If you have an Amazon share, that one share is worth around £3,000. 

This makes it worth more than ten times most company’s shares. Its value increases in amounts of hundreds of dollars before depreciating down to no less than £2,500. This means that whether you are a high yield, long-term investor or a day trader, you can squeeze Amazon for some kind of value.

But Amazon’s shares sitting at around £3,000 presents its own problem. How are you supposed to buy something that expensive if you are not already rich? In fact, where are you supposed to buy Amazon shares? It’s not like they are sold at gas stations. And what do you do to make money off of them?

Related: Best Shares to Buy Now in 2022

These are all good questions. And luckily, they have answers. Let’s take them one by one and see: Just how do you buy Amazon shares as someone trading stocks in the United Kingdom?

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Where Do You Buy Amazon Shares? 🛒️

The first step to buying Amazon shares is figuring out who is going to sell them to you. But the funny thing about the stock market is that the question of “who” is not actually that hard to answer.

Anyone who has Amazon stock is also looking to sell it. Nobody holds onto stock, petting it like a cat. That means you do not have to hunt down an individual seller. The much more important step in the process is finding the place where all the sellers of Amazon stock go. These are called trading platforms.

How do you get on Trading Platforms?

Trading platforms are usually managed by brokers. A broker is a company that gives you access to a stock market. It can be the London Stock Exchange, the New York Stock Exchange, or basically any other major stock exchange. Amazon will be listed basically everywhere, so you will not have trouble finding it.

Technically speaking, there is a review and auditing process that is required to get on these platforms. Calling it “a review and auditing process” makes it sound incredibly serious, but it is not. Mostly, it is a robot doing a background check to make sure you did not commit any securities fraud.

After you create your account, you will have to verify and fund it. This means connecting your bank account, as you cannot just buy shares with a credit card. And besides, you need to be able to send funds to your bank account once you accrue them. This requires an account and routing number.

Once you are on a platform, verified, and funded, you can start buying shares. But then you run into the next problem: They are so expensive! How are you supposed to buy a £3,000 share of anything?

The answer is: You don’t.


How do you Buy Amazon Shares? 💰️

There are a few different ways you can buy Amazon shares, but we will start with the standard method: Buying the share itself. Or rather, buying a percentage of a share since the whole share is too expensive.

You see, you do not have to buy into a whole share. You can just buy as much of a share as you can afford. This is especially helpful with big shares like Amazons. The amount the share increases in value is proportional to the percentage of the share you bought. This is called a “fractional share.”

How Do Fractional Shares Work?

Let’s slow down and talk about this: Imagine that Amazon’s shares cost £3,000 each exactly. You buy £30 of a share. That is 1% of a share. So, if Amazon’s share price goes up by £500, then your £30 share will go up by £5 in value. Obviously, that is a very big “if”, as a share going up by £500 isn’t happening.

But the idea is the same whether the share increases by £500 or £5: The amount your share increases is the same as the amount of a share you own. If you own 5% of a share, then it will increase at 5% the rate that the full share increases. This means it will never increase by much without a big percentage.

Why Buy Fractional Shares?

But the thing is, you do not need an Amazon share to increase in value by much in order to make money off of it. 5% of an Amazon share’s value is greater than 100% of many other company’s shares.

Of course, it does beg the question as to what the best amount to put into Amazon is. Truthfully, it is all about what your investment strategy is. For instance, if you are focused on short term income gain and day trading, then you are going to want to aim low on the size of your fractional shares.

This is because many day trading strategies are built on making small investments that are low risk and pay out equally small amounts. So, you buy a fractional share that is less than 5% the total value of Amazon’s share price, then sell as soon as it increases by anything more than 2%.

If you are looking to do something more long term, then you will want to have at least 10% of a share. This does not mean you need to buy all 10% at once, however. You can buy the share 1% at a time.


Alternative Ways of Buying Shares 📊️

But buying shares wholesale is only one possibility. There are alternative tools for getting value out of shares. Keep in mind though, these are riskier ways of trading. That means they have a higher buy-in, but also a higher maximum output. So, trade at your own risk.

Contracts for Differences (CFDs)

The first alternative method of buying shares is called a “contract for differences”. This is probably the highest risk and highest reward security you can trade while still actually trading a stock.

Not all platforms are going to carry this due to how risky it is. But here is basically how it works: First, a buyer and seller meet. Sometimes the buyer approaches the seller, sometimes it is the other way around. They agree on a stock, and a date. Then, the buyer offers a price for the future date.

So, imagine there is a share, even a fractional share. The buyer offers to buy that share at the appointed date for the appointed price. The seller either accepts or rejects it. 

The goal for each party is to make more money than they normally would on that date. The seller wants to sell the stock for more than it would be worth on that date, while the buyer wants to buy it for less than it will be worth on that date. As you can probably see, this often pits them against each other.

It is not strictly zero-sum, however. It is possible for a CFD to benefit both buyer and seller. 

It just will not happen most times.

Stock Options

One of the more popular ways of trading without actually buying the share is by selling the “option” of buying the share. This is a weird one, but it is a good way of trading after the markets have closed.

Trading stock options means that rather than trading the share itself, you are trading the option to buy the share. This means that the share cannot go anywhere, but you can still choose not to buy it.

This appeals to people, as the option of a share can follow very different trends than the share itself. Since the option’s value is determined by where people think the price of a share will go, rather than the market value of the share itself, its price is more negotiable.

This cuts both ways, however: You might get an option for an unusually low price and sell it for an unusually high price just by having a silver tongue. But you have to be careful to avoid buying something at a high price and selling it for less than it is actually worth.


Conclusion ➡️

If you want to buy Amazon shares, then there are lots of places that will sell them to you.

Even better, you can get fractional shares if you cannot invest in a whole share and sell them the moment they produce the yields that you need. Or you can hold onto them and wait for them to grow more.


Shares

And if you are looking to get a lot of value out of your trades, you can take even riskier trades. Whatever you want to do, there is a pathway to do it. Just know your strategy, and know when to get out.