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Trading Apple Stocks - How to trade Apple (Guide)

Ben Weiss, Wednesday, 4 September 2019

How to trade Apple

Apple Inc. is one of the most well-known brands on the planet and is a true global giant in the technology industry. Unsurprisingly, it’s listed on multiple indices including the Dow, Nasdaq and the S&P 500. It’s popularity and worldwide recognition make it one of the most sought-after stocks to trade, so here’s a complete guide on how to trade Apple.

How to trade Apple

Trading Apple is simple. You just need an ETX Capital account and then you choose Apple from the array of markets and stocks that are available to trade. Here’s a step-by-step guide of how to trade Apple. 

  1. Sign up for an ETX Capital account
  2. Find Apple from the list of markets
  3. Think about exactly how you want to trade Apple
  4. Consider the stops and limits
  5. Open a position for Apple

Download our free step-by-step guide on exactly how to trade Apple (includes screenshots) - How to trade Apple (PDF Guide)


1. Sign up for an ETX Capital account

Firstly, you must sign up for a trading account, in order for a broker to process a trade for you. At ETX Capital, service is important to us. As a small trading broker based in Liverpool Street, we can offer a highly personable service, valuing every single one of our clients. We may be small, but we still have over 50 years’ experience in the industry, so why not trade Apple with a credible broker which also offers exceptional service to all clients?

Signing up takes a matter of minutes, and you could be all set to trade Apple on an award-winning platform in no time at all. What’s more, our Customer Service Team are available 07:30-21:00 Monday to Friday, so they will happily talk you through the process, help you get started with your account and answer any questions you may have.

2. Find Apple from the list of markets

We offer over 5,000 markets, and not just stocks and equities. Indices, cryptocurrencies, a number of FX pairs and commodities are all available on our TraderPro platform. To trade Apple, simply search ‘Apple’ in our ‘Market Search’ bar or browse our ‘Popular Markets’ watchlist containing all of the most popular markets and choose Apple from the resulting list. Once selected, you’ll be able to see price information and use fully-customisable graphs to view the history of Apple’s share price.

3. Think about how exactly you want to trade Apple

Many new traders often fall into the same trap of thinking that by trading Apple or any market, that market must do well in order to make a profit from the trade. However, the beauty of trading Apple over investing is that you can open a short position and benefit if/when Apple’s price falls.

Before you open a position on Apple, decide whether you want to trade Apple long or short. It’s also worth thinking about ‘an out’ – a time, price or market event that will trigger you to close the trade. Risk is involved with every trade you make, so it’s important to think carefully before you open a position on a market.

Once you’ve chosen whether to trade long or short, you must then decide how long to keep it open for. This decision should be determined by why you want to trade Apple. Has it been in the news recently for negative reasons? Do you think it will be a long-term profit-maker? Do you believe an imminent earnings report will cause its price to move? Depending on your reasoning, you should either day trade, scalp or long-term trade.

4. Consider stops and limits

Stops and limits provide you with that extra little bit of security when it comes to trading. They can ensure that profit is secured when a price moves in your favour, and losses are limit when it’s not gone so well.

Before opening a position on Apple, consider what might affect its price in the future (see below), and how exactly its price might react. For instance, if an earnings report is on the way, you should know that this has the potential to cause short-term volatility. So, a stop that you might have applied at 100 points lower than the current price might have to be put 200 points lower in order for your position to remain open during the period of volatility. If the stop is left, the short-term volatility might close the position as the stop price is reached, even though Apple’s price might return back to its previous level once the volatility ends.

5. Open a position for Apple

After these first four steps, you’re now ready to trade Apple. Simply open a ticket, select any limits and/or stops, choose how much to trade a point and whether to go long or short and then you’re all set.

What is Apple?

Apple, or to use its full operating name, Apple Inc., is a technology firm that was founded in California US. It’s known for releasing a number of products such as its most successful invention, the iPhone, the Mac computer and its own brand of fitness watch.

Since the beginning of the century, Apple has been known for reinventing the boundaries of the phone, computer and other technology sectors by releasing innovative, exciting and unique new models. For instance, the touch-only iPhone was revolutionary when it was released with no typical keypad feature, and has contributed to the company’s illustrious success that saw it reach a market capitalisation value of over $1 trillion.

Apple: Quick factfile

Founded  1 April, 1976 in Cupertino, California, US 
Founders  Steve Jobs, Steve Woznial, Ronald Wayne 
Headquarters   Cupertino, California 
Number of employees   132,00 (end of 2018) 
Number of stores  506 in 24 countries
Revenue  $265 billion (2018)


Apple Park, the new HQ of Apple Inc. in Cupertino, California, US. 

Apple stock price dates of interest

12 December 1980
Apple goes public
Apple goes public, selling 4.6 million shares at $22 each.

 9 June 2014
Stock split

Apple dilutes its stocks by seven, meaning those owning one share now have seven, but the price falls from $647.50 to $92.44.

2 August 2018
$1 trillion market value

Apple becomes the first ever company to have a market value of $1 trillion.

3 October 2018
Apple high

Apple hits an all-time high (with price adjusted from stock split) of $233.47.

  30 June 2019
Recent stock situation

There are a total of 4.601 billion outstanding Apple shares; its price is $198.06. 

Apple trading information

UK trading hours for Apple Inc.

Mon-Thu 09:30-23:00
Fri 09:30 – 21:58

Spread: 40

Although Apple is tradable from these hours, it’s important to note that the market does not officially open until 14:30 (due to US market open), so until that time we offer a pre-market service.

Tier  Size (shares) Margin 
1 0 - 2,500  20%
2 2,500 - 10,000  20%
3 10,000 - 19,000  20%
4 19,000 + 40% 

 

Why trade Apple with ETX Capital?

  • Personalised service
  • Multi-award winning
  • Exceptional trading platform
  • Comprehensive risk management
  • Competitive spreads

As one of the most popular equities on the market, the sheer volume of trades of Apple drives its price in differing directions. At times of high volatility, it’s particularly important to trade using the right platform with the best trading tools to equip yourself with the best possible chance of being profitable. At ETX Capital, we offer a great service and all the tools you’re ever going to need to trade Apple.

Personalised service

As a relatively small broker in the industry, we can offer a far more personalised service than most others. Our Customer Support Team is on hand throughout the week to offer one-to-one assistance on any trading queries you may have. What’s more, if your first deposit is £1,000 or more, you will qualify for your own personal account manager who will provide regular market updates, exclusive insights to the platform and also place trades pursuant to your instructions.

Multi-award winning

From our education to our TraderPro platform, we’ve won awards for nearly everything in our industry. Why trade with anyone else when you can trade with a multi-award-winning broker?

Exceptional trading platform

As mentioned, our TraderPro platform has won not just one, but numerous awards. We listened to feedback from our clients and designed a truly outstanding platform that offers instant execution, seamless transitioning between desktop and mobile and over 80 technical indicators. TraderPro provides a comprehensive and reliable platform to make trades from and gives you all the tools to analyse over 5,000 markets, Apple included.

Comprehensive risk management

A number of those tools fall under the risk-management category. Stops are vital when trading equities such as Apple, as they can ensure that even when the stock experiences sharp changes in price, your positions won’t be susceptible to the losses equating to the full exposure of the position.

Stops are great, but a stop loss order is not always executed at the correct price as it often falls victim to slippage and gapping. With guaranteed stops, the order is executed and the position closed regardless of these two factors, so your trade will be closed at the exact price you’re expecting. At ETX, we offer these for free* - where other brokers charge a fee for this privilege.

It's not just stops though, we offer dynamic limits and hedge markets, so you can effectively mitigate your losses. If you’re knowledge on managing risk isn’t quite up to scratch, we have got you covered for that as well. Check out our education section where we have complete guides on how to manage risk in trading.  

Competitive spreads

When it all comes down to it, perhaps the most important thing about trading is the money. Spread is the commission taken by all brokers to cover the costs of placing the trade on your behalf, operating the service, running the platform etc. We ensure that all our spreads at ETX Capital are competitive, so you won’t be losing large sums before a position has even been opened longer than five minutes.  

Find out more about what spread is.

What impacts the price of Apple?

It’s crucial to know what drives, or what could drive, Apple’s price once your trade has been made. This way, you will not only know what price catalysts to look out for, but you will also be able to predict how Apple’s price might change.

  • Technology industry
  • Competitors
  • Internal factors
  • Legal

Technology industry

Being such a key player in the technology industry, Apple is obviously susceptible to any wider changes in the sector. If, for instance, a new form of tech is invented and all of the major companies release their own forms of the new device, it is likely to be another revenue-generator for Apple – given the premium consumers are willing to pay for the Apple brand. Equally, if new regulation that hinders the entire industry is released, Apple’s sales will undoubtedly fall and so too could its share price.

Keeping an eye on the tech industry, what’s new in it, what’s changing and why could be vital in being able to trade Apple profitably.

Competitors

Similarly, Apple’s competitors will be key to track as their price will correlate directly with Apple’s. For instance, Microsoft is a direct competitor of Apple. There’s only a finite number of customers Apple and Microsoft can appeal to in, let’s say, the phone industry (as people genuinely only need one phone), so if Microsoft’s sales increase its likely that that could be at the cost of Apple.

Of course, so many other factors are involved, and with multiple players in the industry both could hypothetically be excelling tothe detriment of the other firms in the sector. But genuinely speaking, anything major that a direct competitor of Apple does is going to have some effect on Apple’s price as they’re competing for the same clientele.

Internal factors

Having noted the importance of tracking Apple’s competitors, Apple’s actions itself will have a greater impact on its price. Watch out for new releases and analyse carefully their plans for the future, as they will determine the direction the company is heading in.

Legal

Depending on how you are looking to trade Apple, legal factors may be significant. With Facebook, a number of huge fines have been issued to the firm for breaching data. When these were first announced, Facebook’s price dipped, but fines are usually a short-term price-driver, as it’s the consequence of a past mistake or action as opposed to an indicator in the direction or competence of a company (unless the fine is relatively large enough to completely cripple a firm).

However, on-going legal issues that can severely impact future sales in the long-run, similar to that experienced by Huawei, will be a long-term factor. Something like this can significant effect a price of an equity permanently.

It’s important to not react to just the base news that’s released about Apple, but think about why it’s happened, what the long-term impact could be and how it might affect your open position.

Advantages and Disadvantages of trading Apple

 

Advantages

Disadvantages

As one of the largest global companies, all the major news networks will extensively cover any story about Apple. This means it’s highly unlikely you’ll miss out on any important information that may change its price.

Given its notoriety and size, Apple is susceptible to so many different factors. This means that it can easily be negatively affected by events that aren’t even industry related.

With such large trade volumes and with Apple being susceptible to more external factors than most (given its stature), volatility in Apple’s price is not uncommon. This can make for a more exciting trading experience and the potential for larger losses – but also larger losses, so managing risk effectively is vital.

Its role in the US-China trade war has been somewhat significant, with China using it to retaliate against the additional tariffs that have been imposed. Sales in China have been prohibited for certain models.

Apple as a company is frequently releasing new products and models to the industry. The success of each release can drive its price, so there will always be major releases to trade around.

 

 

Why you should trade Apple instead of investing in it

In terms of trading vs investing in Apple, trading has more benefits. Investing in Apple might seem like a good idea, but trading will give you far more flexibility and choice over how much exposure you wish to risk. 

Here’s why you should trade Apple instead of invest in it: 

  • Greater exposure for less risk
  • Trade long or short
  • More freedom and control of your investment and risk

Firstly, trading will ensure you can have greater exposure for less risk. Apple’s share price is currently over $200.00, meaning that investing $200 in Apple shares will get you one share. If Apple’s price rises to $250.00, you will make $50. However, if you trade Apple, you can open a position with just 20% margin investment upfront. This means your $200 can open a trade on Apple at $5 per point, so you’ll get a profit of $250 if you open a long position and its price rises to $250.

$200 investment in Apple vs $200 trade of Apple (when price of Apple rises from $200 to $250).

$200 initial investment is equal to one share of Apple (at a price of $200). When Apple's price rises to $250, that one share bought for $200 is now worth $250, meaning the investment in Apple has made a profit of $50.

On the other hand, a $200 dollar trade in Apple would earn a $250 profit if its price rises $250. A $200 trade will come with a %20 margin rate, so just $40 would be needed to trade Apple at $1 per point. Therefore, $200 would ensure a position of $5 per point can be opened on Apple ($200 funds / $40 margin requirement = $5 per point). When its price rises to $250, that's an increase of $50 (points). So, at $5 a point, a profit of $250 will be made on the Apple trade. 

It must be noted, though, that risk is higher with trading as you can lose more than your stake but investing consists of only wagering your initial investment.

Secondly, you don’t have to believe Apple will do well to trade it. Where investing is a very one-way process where if Apple does well, your investment does well, trading opens the door for ‘anti-Apple sentiment.’ If you think it’s going to struggle or you want to capitalise on a downward price movement, you can. When opening a position on Apple, you can trade either long or short, meaning whichever way Apple’s price is moving you can take advantage.

Another benefit of trading over investing is that you can implement risk management strategies to limit your losses. This cannot be done with an investment as you can’t always withdraw (or sell off) the money you invested in the stock, and when you are able to this must be done manually. In general, you have much more freedom and control.

*Free Guaranteed Stops are only free at certain times, on some markets for retail clients only - click here for more information

 



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