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How to Buy Microsoft Stock (MSFT)

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Microsoft was founded in 1975 by Bill Gates and Paul Allen, who helped transform the personal computer from a hobbyist’s toy to an indispensable tool with many applications and uses.

Nowadays, Microsoft Corporation is a leading technology company that develops and supports software, services, tools and solutions.

The company is headquartered in Richmond, Washington, USA. It generates revenue by developing, licensing and supporting a wide range of software products and services, designing and selling hardware, and online advertising to a global customer audience.

In addition to selling individual products and services, Microsoft also offers suites of products and services.

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Products include operating systems for personal computers, servers, phones and other intelligent devices; server applications for distributed computing environments; productivity applications; business solution applications; desktop and server management tools; software development tools; Video game; and online advertising.

Microsoft designs and sells hardware, including the Xbox 360 gaming and entertainment console, Kinect for Xbox 360, Xbox 360 accessories, and Microsoft PC hardware products.

The company provides consulting as well as product and solution support services and provides cloud-based solutions that provide customers with software, services and content over the Internet through shared computing resources located in centralized data centers. Cloud revenue is earned primarily from usage fees and advertising.

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Segments within the organization include productivity and business processes, intelligent cloud, and more personal computing.

What’s the latest from Microsoft?

These are Microsoft’s performance figures from last year’s final quarter, published on January 24, 2023: Revenue for Q4 2022 was $52.7 billion, up 2% year-over-year.

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Net income was $16.4 billion in the last quarter of last year, down 12% from the same period in 2021.

Estimated revenue for the first quarter of 2023 is estimated to be between $50.5 billion and $51.5 billion.

The company recently announced that it would cut 10,000 jobs, which is around 5% of its workforce.

Microsoft recently revealed a multi-year, multi-billion dollar investment in Open AI, the company behind the artificial intelligence program ChatGPT. This is the third phase of the partnership between the two companies that began in 2019. Here’s everything you need to know about buying and selling Microsoft shares.

Note: There is no guarantee of investing in company shares. While buying shares, it is also possible to lose some or all of your money.

how to buy microsoft shares

Before deciding to open an account, you should determine your investment goals, which include the amount you want to invest, the amount of time you plan to invest, whether you are comfortable with the risks involved And can you afford to lose money?

If you are looking to buy shares of Microsoft, the following steps will guide you through the process:

1) Open a trading account

Whether you are an experienced stock trader, or a beginner, you will need to open an account with a trading platform.

It is worth taking the time to review the costs involved – most, but not all, platforms charge share trading fees and some may even charge an annual platform fee for holding shares.

There are a variety of trading platforms available, from online DIY platforms such as Hargreaves Lansdowne, AJ Bell and Interactive Investor to app-based platforms such as eToro and Trading212.

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2) Where does Microsoft do business?

The ticker symbol for Microsoft is MSFT. Microsoft is traded in the US on the Nasdaq, which is open for trading Monday through Friday from 9:30 a.m. to 4:00 p.m. (Eastern Time).

Most trading platforms allow you to buy US shares. You will be charged a foreign exchange fee (usually around 1%, but can range from 0.15% to 1.5% depending on your platform). Many platforms also charge slightly higher trading fees for buying US shares.

If you’re planning to trade US stocks regularly, it’s worth looking at the different platforms as their fees can vary greatly. Some trading platforms, such as IG, allow you to hold your account in US dollars which can reduce the amount of foreign currency you pay.

You will be requested to fill out a W-8BEN form, which allows you to reduce withholding tax from 30% to 15% for qualified US dividends and interest.

If you own US stocks you will also have a foreign exchange risk. If the pound weakens against the dollar, your shares will be worth more in pounds sterling (and vice versa).

Like UK shares, any gains on US shares will be subject to Capital gains tax, subject to your annual allowance (currently £12,300). If you hold shares in Individual Savings Account or Self-Invested Individual Pension, you will not have to pay capital gains tax.

3) Do your research

To learn more about Microsoft, visit the company’s website Investor Relations Page,

It’s also worth comparing Microsoft’s valuation to that of other comparable global software companies. One way to look at the relative price-earnings ratio is that stocks trading at a higher price-earnings ratio tend to have higher expectations of significant future growth.

Another useful research tool is the broker’s 12-month stock price forecasts, which are available on financial websites. Nearly 40 brokers are currently following Microsoft shares, and their price forecasts indicate both upside and downside risks to the Microsoft share price over the next year.

4) Should you invest on a monthly basis or as a lump sum amount?

People buy stocks either as a one-time purchase, or drip-feed their investments on a monthly basis over time.

Monthly investments are often referred to as a means of ‘pound cost averaging’, making regular contributions to help weather the ups and downs of the stock market. This provides some protection if the share price drops after you buy the shares, as you will effectively be investing at the average share price over the entire period.

However, if the share price is rising and you can afford to pay more in share trading fees, drip-feeding your investments may sacrifice capital growth.

5) Place Your Order

Once you are ready to buy shares in Microsoft, log in to your trading account. Type in the ticker symbol MSFT and the number of shares you want to buy, or the amount of money you want to invest.

Many platforms also allow you to add a ‘stop loss’ after buying a share, which allows you to limit your losses if the share price falls. For example, if you buy shares at £100, and set a stop loss of £90, your shares will be sold if the share price falls below £90, reducing your potential loss to 10%. will be limited.

6) Monitor Microsoft’s performance

Whether you hold shares in just a few companies or many, you should review how your shares are performing on a regular basis.

Monitoring your portfolio allows you to make necessary adjustments, whether buying additional shares, or selling part of your holdings.

How to sell your Microsoft shares

When you want to sell your Microsoft shares, log in to your trading platform, type in the ticker symbol (MSFT) and select the number of shares you want to sell.

If you have made a profit, you may have to pay capital gains tax (CGT) on the sale of your shares. However, as mentioned earlier, this is not the case with tax-exempt wrappers such as individual savings accounts.

How to invest indirectly in Microsoft

You can make a profit if you invest in Microsoft shares, however, holding shares in an individual company carries more risk than investing in a broad range of stocks. A diversified portfolio should also reduce volatility.

One option is to invest in Microsoft indirectly by investing in a fund, investment trust, or exchange-traded fund (ETF) that holds Microsoft shares. These products provide a ready-made portfolio of stocks in many different companies.

There is a wide range of options, including global, US and technology funds and investment trusts with ETFs that track Nasdaq indexes. However, you will pay an annual management fee to hold these products.

Invest in global and local stocks with zero commission

Explore over 2,500 stocks. Buy in bulk, or invest in fractional shares

start investing

Your capital is at risk. Other fees apply. Visit etoro.com/trading/fees for more information.

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