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Founded in 2004 by Mark Zuckerberg, Meta Platforms Inc. (ticker: META) is an iconic US multinational corporation and the seventh most valuable company in the world by market capitalisation, or ‘market cap’ (US$1.265 trillion).
Formerly known as ‘Facebook’, the company was rebranded as Meta Platforms, demonstrating its strategic goal to build and focus on the Metaverse, a digital, virtual reality platform in which users connect in 3D. Meta is headquartered in Menlo Park, California (US), though the company’s operations span across Europe, the Americas, Africa, the Middle East, and Asia Pacific.
Meta is an umbrella company and includes social media platforms, such as Facebook, Instagram, and WhatsApp, which allow friends, family, and businesses to connect. The company opens the floor for people to have a voice, share interests and ideas, and upload photos and videos from their computers or mobile devices.
With a global workforce of around 70,000 employees, most of the company’s profits are derived from advertising revenue across social media platforms and business solutions. The company sells advertising space for companies that generally target a certain demographic, based on age, gender, and country of residence.
CFDs, or ‘Contracts for Differences’, are leveraged derivative trading instruments traded in the over-the-counter (OTC) market and are one of the most cost-efficient ways to invest in financial instruments, including Forex (currencies), Stock Indexes, Digital Currencies, Commodities, Bonds, ETFs (Exchange-Traded Funds) and, of course, Stocks, such as Meta.
With FP Markets, you can trade more than 10,000 stocks across key stock market indices. Unlike when you trade through a stock exchange and thus take ownership of your stock purchases, trading CFDs allows traders and investors to speculate and hedge on the stock’s price movement without taking direct ownership. All CFD products, regardless of the underlying asset, are cash-settled.
Given that you can trade CFDs across global markets, speculate and hedge in these markets, and that CFDs are leveraged cash-settled derivatives, the question is how do we buy and sell Meta Share CFDs?
1. Open an FP Markets Forex and CFD Trading Account
At FP Markets, the account-opening process is straightforward. Opening a Live account is quick and available through several of our trading platforms, including MetaTrader 4 (MT4), MetaTrader 5 (MT5), and cTrader.
To open a trading account with FP Markets, click on the ‘Open Live’ tab at the upper right-hand corner of the FP Markets webpage, as shown below:
Following this, you must complete the Account Application, which consists of a handful of steps and involves uploading photo identification and proof of residence.
2. Select the Trading Platform
As highlighted above, you can trade Meta on several trading platforms with FP Markets. For this article, we will assume you are trading Meta on MT5.
Once your account is approved, account details will be sent to your registered email, including the account server, the trading account ID and password. You can then visit the FP Markets Client Portal and proceed to download the MT5 platform, as per the images below:
3. Locate the Meta Ticker on MT5
Once the account is up and running and you have downloaded and accessed the MT5 trading platform, you can access real-time prices for Meta.
To select the Meta ticker through your MT5 platform, press Ctrl+M and search META in the ‘click to add’ section. You will notice the stock CFD is listed under FACEBOOK. Once the stock is added to your MT5 Market Watch, proceed to ‘drag and drop’ the security to the chart interface. This will then display the stock’s current price chart and allow for chart modifications to suit personal preferences and trading style (e.g. background colour, candles or bars, timeframes, and the addition of technical indicators and drawing tools).
4. Place the Buy or Sell Order
Once you have researched whether the stock is overvalued or undervalued and want to enter a buy (long) or sell (short) order, you can do this in a few ways on MT5. The most straightforward way to buy or sell a stock CFD is by pressing F9 to open the order window, as shown below. Here, you can modify the order to suit your trading idea. This ranges from the order type (market or pending), the volume (the position size [lot size]), stop-loss order and take-profit order.
Importantly, as you are trading CFD derivatives, you are trading on margin. This means that you are not required to put up the total notional value of the underlying investment; you will only put up a fraction of that value, referred to as ‘initial margin’.
Examples of long and short positions in stock CFDs can be found below:
5. Monitor the Position
Once the position has been placed and is confirmed as live in the market, an investor will monitor their position closely, tracking its performance.
Investing in physical shares (share dealing) involves direct ownership – if you purchase shares of the stock, you will own a slice of Meta. The most frequently traded shares are common and preferred shares, usually held as long-term investments.
However, unlike the ‘old days’ when you would receive a stock certificate, you will find that unless you are registered with the transfer agent under your name, you are the ‘beneficiary shareholder’, and the investment broker you use will be the ‘nominee shareholder’. This means you will not receive a stock certificate; instead, you hold the ‘right’ to the company’s shares you invested in.
For those new to share dealing, investors receive a unit of ownership if they purchase shares in a publicly listed company (which are often freely negotiable and, therefore, transferable). Being a company shareholder (or many companies) translates to partial ownership of a company’s capital. As a shareholder, the shares of the companies you’re invested in can increase or decrease in value (capital gains); you also can receive dividend payments and have the right to vote for things like the approval of members of the board of directors and the distribution of dividends. However, in the event of a company filing for bankruptcy, you could lose your entire investment.
Another common way to trade, invest, and hedge stocks like Meta is through the futures and options market. A futures contract allows you to buy or sell stocks at a specific price on a future date, while an options contract holder has the right, but not the obligation, to buy or sell shares of a stock at a future price on a future date.
Unlike CFDs, futures and options contracts are traded on an exchange, though they are leveraged derivatives like CFDs. One key difference between CFDs and futures and options is that the former is always cash-settled. At the same time, the latter can involve physical delivery of the underlier, be it a stock like Meta or barrels of oil.
Futures and options are also standardised derivative contracts, meaning that specific details are clearly shown, such as the quality and quantity of the underlying asset, the number of shares of a company, the tick size, details about the physical delivery, and the expiration date.
ETFs provide investors with a way of investing in a pooled investment traded on an exchange. They are usually passively managed (different from an actively managed fund in which a portfolio manager takes the reins and decides which investments to make) and track the performance of an index. An ETF can track a collection of bonds, a specific collection of currencies, a pool of commodities, or even a selection of equities.
However, there are several types of equity ETFs; these can range from sector-specific ETFs to international ETFs, dividend ETFs, or even market-cap index ETFs. The point to understand with ETFs is that instead of investing in one stock, like Meta, you can invest in a bundle of stocks that include Meta to help diversify risk exposure. Not only do ETFs benefit from offering access to different markets and sectors, but they are also low-cost, flexible, and tax-efficient.
1. What is Meta?
Meta Platforms Inc. (ticker: META) is a US multinational corporation. Formerly known as ‘Facebook’, Meta is an umbrella company for online social media platforms, such as Facebook, Instagram, and WhatsApp, which allow friends, family, and businesses to connect through their major social media platforms.
2. How can I invest in Meta shares?
You can invest in Meta shares in several ways, including trading CFDs, share dealing, futures and options, and ETFs.
3. Where can I learn more about investing?
Visit the FP Markets Academy, where new and experienced traders can learn about technical and fundamental analysis. You could also start trading Meta through one of the FP Markets demo accounts; the opening procedure takes only a few minutes!
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