How to use options to buy Amazon.com stock?

Amazon.com shares are one of the largest technology and e-commerce companies in the world. Owning Amazon stock can be a great way to invest for the long term and build a diversified portfolio. Investors today have several options when it comes to buying Amazon.com stock.

Direct purchase of securities

One of the easiest ways for investors to buy Amazon stock is to buy Amazon stock directly from an online exchange, such as Nasdaq. Investors can buy Amazon shares using funds from their bank account or brokerage account. Online brokers generally offer very competitive transaction rates and offer a wide variety of financial products, such as stocks, ETFs and mutual funds. Online brokers also offer support and investment services, which is a plus for novice investors.

Purchase options

Options are contracts that give investors the right, but not the obligation, to buy or sell securities at a fixed price. Options are derivatives and can be bought or sold from a trading platform. Call options give investors the ability to buy Amazon stock at a pre-determined price. Investors who buy call options may experience an upside benefit if the price of Amazon stock rises. However, investors should understand that options are leveraged products and may involve high risk.

Put Options

Put options are similar to call options, except investors have the right, but not the obligation, to sell Amazon stock at a pre-determined price. Put options can be used by investors to profit from a fall in the price of Amazon shares. However, investors should understand that options are leveraged and may involve high risk. Investors should familiarize themselves with their risks before they start trading options.

Futures options

Futures options are contracts that give investors the right, but not the obligation, to buy or sell Amazon stock at a pre-determined price. Futures options are leveraged products and may involve high risk. Futures options offer investors the ability to buy or sell Amazon stock at a pre-set price and can be bought or sold from a trading platform.

Conclusion

Investors have several options when it comes to buying Amazon.com stock. Investors can buy Amazon stock directly from an online stock exchange or by using call options, put options or futures options. It is important to understand the risks associated with each product and to be familiar with their risks before you start trading. Overall, Amazon stocks are a great long-term investment option and can be a profitable way to diversify your portfolio.

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