An oft-repeated investment rule is to buy what you know, which means you should own stock in companies whose products and services you use. or otherwise familiar with them. If you like fast food, then you may be interested in how to buy McDonald’s stock. With billions of people served in thousands of locations worldwide, the company is an established leader in the food service industry. Adding McDonald’s stock to your portfolio is a relatively simple process. Before adding any stock to your portfolio you may want to work with a financial advisor to get advice specific to your situation.
Is Investing in McDonald’s a Good Idea?
Whether buying stock in McDonald’s or any other fast food company makes sense for you depends largely on your goals. It also helps to know a little about McDonald’s stock and what differentiates it from competitors. There are some key things to consider when evaluating any stock:
How long has the company been in business
Short term and long term growth prospects
Overall position in its respective industry, compared to competitors
Market capitalization and valuation
How it typically reacts to volatility and its ability to cope with downturns
McDonald’s is an established company and part of the Dividend Aristocrats club. Dividend Aristocrats are companies that consistently pay investors higher dividends year after year, for at least 25 consecutive years.
That might appeal to you if you are interested in generating current income while applying a buy and hold strategy. McDonald’s is not a growth stock, per se, nor is it generally considered to be a value stock. However, the company has solid financials and long-term plans for further growth that could lead to even greater benefits in the future.
How to Buy McDonald’s Stock in 3 Steps
If you are interested in buying McDonald’s stock, the first step is to dig into the company’s financials. Just as investment experts recommend buying what you know, it’s also important to know what you own. Once you decide that McDonald’s is a good fit for your investment strategy, the actual buying part is fairly simple. Here’s what you’ll need to do next.
Asset allocation refers to how you divide up assets in your portfolio. Diversification is an important part of that as it allows you to balance the risk. When buying McDonald’s stock, consider how much of your total assets you are comfortable investing. As a general rule, you may want to limit your total asset allocation to any one stock or 5% security. Regular rebalancing can ensure you are not overweight in any one asset.
Also, consider whether you want to make a one-time investment in McDonald’s stock or buy new shares from time to time. For example, you might want to initially invest $1,000 in McDonald’s shares, then invest an additional $100 per month. That can determine where you open a brokerage account to make your investment.
As mentioned, you will need a brokerage account to buy McDonald’s stock and other investments. Several discount brokers now offer online stock trading with $0 commission fees. If you don’t have an account yet, it’s a good idea to shop around and compare the best brokerages online.
When comparing brokerage options, consider:
Range of investments offered (ie, individual stocks, exchange traded funds (ETFs), index funds, options, cryptocurrencies, etc.)
Minimum investment or trade requirements
Investment research and analysis tools offered
It is also important to look at what type of trading is offered. For example, some brokers offer DIY or self-directed trading, and it is up to you to decide which investments to buy or sell. Others offer DIY trading and automated trading.
With automated trading, you tell the brokerage your goals and risk tolerance. The brokerage then uses an algorithm to automatically build a portfolio for you. All you have to do is deposit money every month. That’s how most robo-advisors work.
If you are interested in trading individual shares of McDonald’s stock, then you would probably want the DIY option. However, if you’re leaning toward buying ETFs that include McDonald’s as an underlying holding you may prefer the simplicity of automated trading.
Once your brokerage account is opened, you can make your first trade. The process for how to buy McDonald’s stock is likely to be similar at almost any brokerage. You would need:
Navigate to the trading section of your account menu
Look for McDonald’s ticker symbol (MCD)
Enter the number of shares you wish to buy (or the amount you wish to invest)
Choose your order type (market or limit)
Once your order is fulfilled, you will be the official owner of McDonald’s stock. If you would like to continue buying additional shares, you can set up a recurring transfer from your bank account each month to pay for those trades.
If you own shares of McDonald’s stock that you would like to sell, the process is not that different from buying. You would simply log into your brokerage account and navigate to the trading section. From there, you would enter the stock’s ticker symbol and the number of shares you would like to sell.
Whether it makes sense to sell the McDonald’s stock you own may depend on where you are financially and what’s happening with the market in general. McDonald’s is generally the type of stock you buy and hold for the long term, in the hope that it will increase in value over time. If you are still several years away from retirement, it may not be time to sell your shares just yet. When you decide to sell, it is important to consider market conditions and potential tax implications.
Selling at a price point above what you paid for the stock triggers capital gains tax. The good news is that if you’ve held the stock for more than a year, the more favorable long-term capital gains tax rate applies. If you were to sell when prices are down, you may realize a capital loss rather than a capital gain. Capital losses can be used to offset capital gains through tax loss harvesting. That’s something you can talk to a tax expert or your financial advisor about.
The process for how to buy McDonald’s stock is simple and there is no real difference to buying any other stock. The most important aspect is to consider how McDonald’s stock fits with your investment goals and how much you can afford to invest. Choosing the right brokerage is also important for keeping trading fees to a minimum.
Consider talking to your financial advisor about the pros and cons of owning McDonald’s stock and whether it’s right for you. If you don’t have a financial advisor yet, finding one doesn’t have to be difficult. SmartAsset’s free tool matches you with up to three financial advisors serving your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, start now.
If you only have a small amount of money to invest in McDonald’s stock or other stocks, then a platform that offers fractional share trading could be a good place to start. Fractional share trading allows you to buy shares of stock incrementally, allowing you to invest small amounts at a time. Given that the average price of McDonald’s stock routinely hovers above $200 per share, that could be an attractive option if you’re a startup investor.
Photo credit: ©iStock.com/sturti, ©iStock.com/xijian, ©iStock.com/Yaroslav Olieinikov
The post How to Buy McDonald’s Stock (MCD) appeared first on SmartAsset Blog.
What is the best stock for beginners?
Here are the 15 best stocks for beginners to buy in 2022:
- Amazon (NASDAQ: AMZN)
- Alphabet (NASDAQ: GOOG)
- Apple (NASDAQ: AAPL)
- Costco (NASDAQ: COST)
- Disney (NYSE: DIS)
- Meta (NASDAQ: META)
- Mastercard (NYSE: MA)
- Microsoft (NASDAQ: MSFT)
Can I make money in stocks as a beginner? The key to this strategy is to make a long-term investment plan and stick to it, rather than trying to buy and sell for short-term profit. Are stocks a good investment for beginners? Yes, as long as you are comfortable leaving your money invested for at least five years.
Can I invest in McDonalds?
Buying McDonald’s Stock This is a convenient way to invest in shares of McDonald’s Corporation common stock and to reinvest the cash dividends. To participate, visit www.computershare.com/mcdonalds for a plan brochure, enroll and make investments online.
How much money do I need to invest in McDonald’s? McDonald’s franchise applicants must have a minimum of $500,000 available in liquid assets and pay a $45,000 franchise fee. Those looking to launch a new McDonald’s franchise can expect to shell out between $1,314,500 and $2,306,500. Current franchise prices can cost up to $1 million or more.
Is McDonald’s a good stock to invest in? McDonald’s Corporation – Hold Valuation metrics indicate that McDonald’s Corporation may be overvalued. Its D Value Score indicates that it would be a poor choice for value investors. MCD’s financial health and growth prospects, demonstrate its potential to underperform the market.
Can McDonald’s employees buy stock?
McDirect Shares is a McDonald’s stock purchase scheme where you are eligible to build your share ownership and reinvest dividends. You can buy stock through convenient payroll deductions and a very small initiation fee.
How much does it cost to buy stock in McDonalds? It also supports a number of payment processing companies including e-wallets such as Paypal and Skrill, debit/credit cards, or bank wire. The minimum deposit required is $50, although you are not required to spend this much when investing in McDonald’s shares.
Is McDonalds stock worth buying? MCD’s financial health and growth prospects, demonstrate its potential to underperform the market. It currently has a Growth Score of C. Recent price changes and earnings estimate revisions indicate that this would be a good stock for momentum investors with a Momentum Score of A.
Who owns the most stock in McDonald’s?
McDonald’s is not owned by hedge funds. The Vanguard Group, Inc. is currently the largest shareholder, with 9.1% of the shares outstanding. For context, the second largest shareholder holds approximately 6.8% of the outstanding shares, followed by a 4.7% ownership by the third largest shareholder.
How many shares does McDonald’s have?
Who is the current owner of McDonald’s?
Does McDonald’s sell stock?
Publicly traded on the New York Stock Exchange (NYSE: MCD ), McDonald’s stock has a long history of steady growth and stability.
Is McDonald’s stock a good investment? Consistent Dividend Growth McDonald’s increased the dividend every year for the past 20 years. The average dividend growth rate was 7% per year over the last 10 years. That’s a great record. Dividend growth can continue as MCD increases cash flow going forward.
Is McDonalds public? McDonald’s Corporate’s initial public offering was on April 21, 1965. Since going public in 1965, McDonald’s has completed 12 stock splits.
What stock exchange is McDonald’s sold on?
McDonald’s Corp. MCD: NYSE.
Is McDonalds on the Nasdaq? McDonald’s Corporation Common Stock (MCD) Stock Price, Quote, News and History | Nasdaq.
Is McDonalds listed on the London Stock Exchange? McCdonald’s Corp Mcdonald’s Ord (Cdi) is listed on the London Stock Exchange, trading with ticker code 0R16.
What is the 52 week high of McDonald’s stock?
McDonald’s all-time high stock closing price was 274.62 on November 04, 2022. McDonald’s 52-week high stock price is 276.67, which is 0.7% above the current share price.
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