Buy JPMorgan stock
JPMorgan Chase isn’t just an old name with an impressive story in banking, it’s also one of the largest publicly traded financial stocks. Although it may not have the same level of influence it once had over the US financial system, when its founder bailed out the US Treasury in 1895, it is still a very large financial services company with a very wide range of sophisticated operations. There is no part of the US economy that JPMorgan does not touch in one way or another, which makes it a compelling investment for many investors. This financial company has managed to gain over 70% in the past five years. If you’re wondering how to buy JPMorgan stock and take advantage of the company’s growth, here’s how to buy JPMorgan stock.
How do I buy JPMorgan stock?
Get a brokerage account
If you already have a broker that you use to buy and sell stocks, this step is fairly easy and you’ll probably want to use your existing platform and move on to step two or three.
If you do not have a broker, search for some reliable brokerage firms and digital platforms and then choose one of them. Check them out to see what types of accounts each platform offers, such as Registered Accounts, Tax Free Savings Account (TFSA), and Registered Education Savings Plan (RESP). They can even offer registered retirement savings plan (RRSP) accounts and taxable public investment accounts.
Whatever company you decide to work with, you should check the fees and costs associated with trading JPM and other stocks. Ideally, you want a broker that charges no trading fees with low or zero minimum balance requirements.
Evaluate the company’s financial affairs
Before you buy JPMorgan stock, take the time to examine the company’s finances. This will help you determine if you are comfortable with the way they are managed and the risks involved in their operations.
You can find information about the company’s finances from several trusted sources, including the US Securities and Exchange Commission (SEC) and other bodies, or on the company’s investor relations pages. You can supplement this with the kind of insights and research you would find on your own brokerage platform or with trusted Canadian third parties such as Globe Investor or Financial Post.
Determine the amount of investment you want to make
Once you are sure that you want to invest in JPMorgan stock, the next question you have to answer is how much should you buy. To make this decision, think about your overall financial assets and the role you want your stocks to play in your overall portfolio.
Do you have enough to cover your living expenses? What about an emergency fund? Are you saving enough for retirement?
If the answer is not yes to these questions, you may want to hold off on buying a JP Morgan stock until you have shored up some of your finances. But if the answer is yes, then you are free to invest in stocks like JPM stock and others.
Moving forward, you’ll also need to keep in mind the JPM stock price. Since it recently traded at $206 (US$160) per share, you may want to buy what are called fractional shares so you can divide your money among more companies. If you plan to do so, be aware that only WealthSimple and Interactive Broker offer investors the opportunity to do so.
Determine the type of order you want
To buy a JPMorgan stock, you will need to log into your investment account and place an order. So you need to decide what kind of command you want.
For novice investors, there are two main types of orders to consider: market orders and limit orders.
With a market order, you can buy shares whatever the current market price was when you entered your order.
A limit order, on the other hand, allows you to set the price you are willing to pay for the shares, and your order is only executed if the shares can be purchased at the price you enter. This can be particularly useful for stocks that you expect to experience sharp price swings, possibly even at the time you place your order and when it is executed.
Currency conversion fees
If you buy a stock in the US from Canada, you will be subject to a currency conversion fee of 1% to 4% in addition to the normal exchange rate.
Fortunately, these fees can be bypassed with the following strategies:
Get a US dollar bank account: Simply keep the money used to buy US stocks in a US dollar bank account at a local bank. This way, you will never have to do a currency conversion ever.
Doing the Norbert Maneuver: You apply it when you buy a stock or ETF listed on a US or local stock exchange. You buy the local shares of that stock, then you ask your brokerage firm to “override” your local shares and convert them into US shares of the same stock, then you sell your US shares and you can use the resulting US dollars to buy any US stocks or ETF you want without converting the currency .
View the amount of tax withheld
If US stocks pay a dividend, you will be subject to a 15% withholding tax on the proceeds from the IRS. But this varies from country to country.
stock performance evaluation
After purchasing JPM stock, be sure to monitor the stock’s performance as well as keep track of any news about the company. Stock prices change nearly every second of the working day – and often even late at night and early in the morning too. But you’ll want to avoid constantly monitoring it for peaks and troughs. Instead, check its percentage return over regular periods, say every six months or a year, to see how it stacks up against other similar stocks as well as broad market indices, such as the S&P 500.
You should also remember to watch how its financials, like the reports you looked at when buying JPM in the first place, change and grow over time.
How do I sell JPMorgan stock?
As with all other investments, there will come a time when you will want to sell. To do this, you simply need to log into your investment account again, enter the number of shares or dollar amount you want and select the type of sell order.
While this process is quite easy, you should keep one key thing in mind: taxes. If you buy shares in a regular investment account, you may owe taxes if you made a profit.
If you’re looking for a big windfall, be sure to talk to a tax professional about how you can reduce the so-called capital gains taxes you might owe. In the case of Canadians, you will only owe 50% of the capital gains value to the CRA, even on US investments, unless you have more than a 5% stake in a US company and that company’s underlying assets are in the US.
You will also owe IRS estate tax if you had $5 million or more in US investments at death.
Other ways to invest in JPMorgan stock
Trading individual stocks is not for everyone. Since you focus your money on the performance of a few companies, it can take a lot of research and a high tolerance for risk to manage it successfully.
This is why financial experts recommend most people focus on exchange-traded funds (ETFs). These investment vehicles allow you to buy exposure to hundreds or thousands of companies with a single share.
Fortunately, JPMorgan stock is very easy to find in index funds. It is the 11th largest component of the S&P 500 fund by weight. This means that in most S&P 500 index funds and ETFs, you will have just over 1% of each share allocated to JPM. If you’d prefer to deal with more JPMorgan stock in a more diversified investment, you can consider sector index funds as well.
Disclaimer: The content of this article is for informational purposes only. The information provided should absolutely not be considered as investment advice or a recommendation. No warranty is made, express or implied, as to the accuracy of the information or data contained herein. Users of this article agree that Money Secrets does not accept responsibility for any of their investment decisions. Not every investment or trading strategy is suitable for anyone. See the risk warning statement.