How To Buy Disney Stock
Welcome to Trading Brokers step by step guide to buying Disney stock. Here you will find an easy to understand explanation of trading Disney stock. This includes how to buy Disney shares online, what you need to trade Disney stock and how to open a trading account with a stock broker so that you can buy Disney stock online today.
The global entertainment company, Walt Disney Corporation, has been in operation for almost a hundred years. Its business activities include media networks and parks and consumer products, etc. Before you invest in Disney stock, here are some of the key things that you need to know.
Overview of Disney
The Walt Disney Corporation is a global diversified entertainment conglomerate with product offerings covering theme park resorts, broadcasting, sports, TV shows, movies, amongst others. Although founded almost a hundred years ago, by a combination of innovation and a strong focus on the consumer, Disney has remained an industry leader in virtually all its business segments.
The entirety of Walt Disney Co’s products and services are categorised into four (4) major divisions, namely: Media Networks; Studio Entertainment; Direct-to-Customer & International; and the Parks, Experiences and Consumer Products.
These are explained below:
This segment includes Disney’s TV business and many others. Specific products in this segment include Disney, ESPN, Freeform, FX, National Geographic and its magazine, ABC Broadcast Television and some other domestic television stations.
Parks, experiences & consumer products
This mostly covers Disney’s outdoor business which includes theme parks and resorts, cruise lines and vacation clubs in several locations all over the world.
Direct-to-customer & international
Disney’s Direct-to-Consumer and International business segment spans the company’s burgeoning streaming services – Disney+, Hulu, ESPN+ and HotStar. It also includes the international version of its TV channels such as Fox and ESPN.
This is responsible for the production and distribution of the famous Disney movies and includes popular brands such as Marvel, Twentieth Century Fox, Walt Disney Pictures, Pixar, and Lucasfilm, among others. This segment is responsible for blockbusters such as The Avengers, Star Wars, and the Lion King series.
The relative importance of each of these segments in Disney’s financial statements continually evolves. For instance, the Parks, Experience and Consumer Products segment used to be the highest earner until COVID-19 happened.
Investing in Disney
Investing in Disney stock is when you buy Disney shares to own them outright, usually with a view to holding them for the long term. Investors would usually look to buy Disney stock in order to try and make a profit when the Disney stock price increases in value.
Trading Disney stock
Trading Disney stock is when a trader speculates on the movement in the Disney stock price without actually owning the shares in Disney. Traders tend to buy and sell Disney stock on a more frequent basis, usually speculating on daily, weekly or monthly price fluctuations.
You can buy and sell Disney stock online through various methods including spot markets, futures contracts, options contracts, spread bets, CFDs (contracts for differences) and ETFs (exchange-traded funds).
One of the most popular ways to trade Disney stock is via CFDs (contracts for differences). When trading Disney CFDs, you do not actually invest in Disney shares, meaning you are not tied to them. You are only speculating on the rise or fall of the Disney stock price. A CFD is a financial contract, typically between a broker and a trader, where one party agrees to pay the other the difference in the value of a security, between the opening and closing of the trade.
A CFD trader can go short or long, set stop and limit losses and apply trading scenarios that align with their own personal objectives. Traders would open long (buy) positions, if they think the stock price of Disney will rise or short (sell) positions if they thought that the Disney stock price will fall. The difference in price between the entry and exit price is the traders realised profit or loss, excluding any broker commission and fees.
For example, if you think Disney shares are going to increase in price, you could buy a share CFD on the company. You will exchange the difference in price between when your position is opened and when it is closed, earning a profit if the shares increase in price and making a loss if they decrease in price.
On the contrary, if you think Disney shares are going to decrease in price, you could sell a share CFD on the company. You will still exchange the difference in price between when your position is opened and when it is closed, earning a profit if the shares decrease in price and making a loss if they increase in price.
Futures contracts are an agreement to buy or sell a specified asset at a certain date and price. Disney investors can use futures trading to speculate on the price movement of Disney stock in order to try and make a profit. Traders would look to go long (buy) a futures contract if they believe the price will rise or short (sell) a futures contract if they believe the price will fall. The difference in price between the price at the start and expiry date of the futures contract is the profit or loss from the contract.
Disney spread betting
Spread betting is a financial derivative that enables traders to speculate on Disney stock falling or rising without taking ownership of the underlying asset. If the trader makes a correct prediction and the asset does move in that direction, they could make a profit, minus any broker fees. On the other hand, if the price moves against their prediction, they would incur a loss.
Financial spread betting is similar in ways to CFD trading except that you are betting a fixed amount per point on the Disney stock price movement (either up or down) and then pay or receive the difference between the opening and closing price of the bet.
Disney options are financial instruments that are derivatives based on the value of Disney’s stock. Traders usually enter into calls when they expect the price of the underlying asset to increase, and puts when they expect the price to decrease. Option contracts come with an expiration date before which the holder needs to exercise their option to buy or sell an underlying asset at an agreed-upon price. The stated price on an option is known as the strike price.
Buyers can choose to exercise their calls and puts or not whereas sellers are obligated according to the buyer decision. Therefore, the sellers (writers) can be exposed to more risk than buyers whose losses can be limited to the premium paid for the contract in the instance they do not exercise the contract. On the other hand, sellers could lose more depending on the Disney market price.
Exchange Traded Funds (ETFs) enable traders to invest in a basket of securities that trade intraday like individual stocks on an exchange, and are typically designed to track the performance of an existing market or group of markets.
Each ETF is usually focused on a specific sector, asset class, or category. ETFs can be commonly used to help diversify an investment portfolio and create a mini-portfolio, or, for the active trader, they can be used to try and take advantage of price movements.
Disney is included in various ETF’s with shares in the U.S. ETF market. Traders who are interested in trading other companies alongside Disney, may consider ETFs.
Where to buy Disney stock?
Stock trades are processed via a stock exchange, where a stock broker represents each investor. The majority of investors will nowadays use an online stock broker to buy and sell stocks through a stock trading platform which will enable them to connect to the stock exchange. You can see a selection of our best stock brokers below with whom you can open an account to trade stocks online.
ASIC, BVI, CBI, FFAJ, FSA, FSCA
Min $100 Deposit
FCA, CFTC, NFA, BaFin, FINMA, ASIC, FMA, MAS, FSA, FSCA, DFSA, JFSA, METI, MAFF
Min $250 Deposit
ASIC, FCA, DFSA, SCB, CySEC, BaFin, CMA
Min $200 Deposit
ASIC, CySEC, IFSC, DFSA
Min $5 Deposit
Why trade Disney stock?
Trading the stock market has become a popular investment activity for many people, especially with the technology that we have these days making it more accessible than ever. There are a vast number of trading brokers, trading platforms and trading apps available for buying and selling Disney stock with relative ease. The cost involved to get started makes trading Disney stock accessible to traders of all experience levels from across the globe.
The availability of leverage has also contributed towards the increase in aspiring traders. Leverage allows traders to hold a position size greater than they would have been able to without it. E.g. An account balance of $1,000, could take a position size of $5,000 with 1:5 leverage. Whilst this can increase potential profits, it also greatly increases risk. It is therefore of the upmost importance that you have a clear understanding of the significant risks involved with online trading, especially when using leveraged positions.
The majority of traders would look to buy and sell Disney stock to try and earn profit from the variation in Disney’s stock price. When trading Disney CFDs you can speculate long and short on prices rising or falling without actually needing to invest in Disney shares. This can make it a more convenient trading method for anyone who has a trading account with an online broker. Alternatively, long term investors may purchase traditional shares in Disney’s stock for a more long-term hold.
Buying Disney stock can also be a way to diversify a trading portfolio and to hedge against shares in other stocks or investments in other asset classes such as forex, commodities, precious metals and cryptocurrencies.
However, before investing in Disney, it is important you understand the dynamics that affect the Disney stock price.
Factors that move the Disney stock price
Whether you are in for the short, mid or long-term, it is vital you know those factors that can affect Disney’s stock price. Walt Disney trades under the ticker DIS on the NYSE. Some factors influence its stock price trajectory over time. We will look at some of the important factors that you need to consider if you are looking to invest in Disney stock.
Just like every other company, Disney operates within the economy. So, definitely, it is affected by different happenings in it, as the COVID-19 pandemic has shown. The ensuing lockdowns have dealt some blow to Disney’s revenue as its Parks, Experiences and Consumer Products reported massive revenue drops for consecutive quarters. This was caused by the fact that most of its theme parks and resorts were closed for months.
This business segment used to be its highest earner prior to the pandemic. However, that position has now been overtaken by its Media Networks division. Furthermore, the production of TV shows also had to be cancelled. Ditto theatrical and stage-play performances.
A prolonged recession as a result of the pandemic may also affect consumer spending. Similarly, the pandemic may impact people’s willingness to attend crowded places like Disney Parks.
New products, services & strategy
While the short to mid-term outlook for Disney might not seem to be the best, one factor that may influence stock price moves in months to come is the introduction of new service offerings and/or implementation of new business strategies. We saw clear signs of this in the recently announced shift in strategy where most of its business divisions will focus on producing content for its streaming platforms.
Quite similar to the above, Disney’s stock price may be affected by the quality of its acquisitions as it looks to pivot into other markets. For instance, the acquisition of Hulu has quite been beneficial, primarily due to the increasing popularity of streaming services.
Walt Disney is in not a monopoly in its industry. So, it faces some levels of competition from many other companies that are constantly innovating. Disney’s competitors include those directly in its business segments such as Comcast, Time Warner, ViacomCBS and others – as well as indirect competitors like Apple Inc.
With well-thought strategy shifts, Disney can turn the tide and properly position itself in high-growth sectors, despite the pandemic. Fortunately, it is in a good state to implement these as it boasts a healthy balance sheet of about $23 billion cash-at-hand.
How to trade Disney stock online?
If you have taken the time to read through the above, you should hopefully have an understanding of how to trade Disney stock online. Here is a summary of the key steps:
1. Decide if trading Disney stock is for you
Trading Disney stock online carries an element of risk and can take more time than other forms of investing. You will need to research the company, manage your positions, follow market news and decide how to react to it. It is important to understand the risks and dedication that comes with trading Disney stock online.
2. Educate yourself
Before trading Disney stock, it is imperative to learn as much as possible about investing and trading online. Any mistake could prove to be costly. There is an abundance of free educational materials provided by many online brokers that can help you to improve your trading skills and knowledge.
Most brokerages will also provide a free demo trading account so that you can practice trading Disney stock online with virtual funds in order to familiarise yourself with the trading platforms and practice your trading strategies until you feel confident enough to open a real trading account.
3. Choose a Disney stock broker
In order to trade Disney stock online, you will need a broker account and trading platform to execute your trade positions through to the market. When choosing a broker, there are a few important things to consider such as regulation, commission fees, platforms, tools, education, funding options and customer support.
If you do not have the time to research brokers, you can see a list of our best brokers that we have already prepared to help traders. If you would like to know more, you can also view our detailed guide on how to choose a trading broker.
4. Research Disney
If you have made it this far then you may be ready to start trading Disney stock online! The next step is to research Disney to help increase your knowledge in the company. The best brokers should have this information conveniently displayed for you within their trading platform.
5. Have a trading plan
Some of the most important factors that can help determine Disney stock trading performance can be the trading plan and discipline. It is important to have a solid trading plan personalised to your own needs that includes the money management and trading strategy that you will use. Most experts and professional traders would try to not let negative emotions such as fear, anger and greed affect their trading strategy.
6. Buy and sell Disney stock
Once you feel ready to trade Disney stock online, you can analyse the market to help decide if and when you will place your trades. After placing a trade on Disney, you will need to keep track of how it performs and manage it according to your trading plan. Some investors will keep hold of Disney trades for the long-term, whereas traders may buy and sell Disney stock on a daily basis.
Is trading Disney stock right for me?
Trading Disney stock is a popular choice for long-term investors and active traders. It can be suitable for scalping, day trading and swing trading. Traders who would usually trade forex, trade indices, trade commodities, trade cryptocurrency, may look to diversify their portfolio.
However, it is important to understand the significant risks involved with trading Disney stock online, especially when using leveraged positions. Most experts would suggest trading on a demo account with virtual funds to begin with.
This can be a useful way to familiarise yourself with how to trade Disney stock and using trading platforms whilst allowing you to practice your trading strategies until you feel confident and produce consistent results. Most stock brokers provide unlimited demo accounts free of charge.
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