buy gamestop shares on our trading platform comparison

How to buy Gamestop shares?

The retail video game supplier Gamestop hit the headlines at the start of 2021 with an exponential rise in its share price. 

How can we explain this never-before-seen enthusiasm for the GME action? Is it still a good time to buy Gamestop stock? What predictions are made by stock market analyses? Should we really invest in this stock?

We will try to answer all these questions by providing as complete an overview as possible of the company that caused a sensation in the midst of the coronavirus pandemic.

67% of retail investor accounts lose money when trading CFDs with this provider. You have to ask yourself if you can afford to take the high risk of losing your money.

In order to better understand the phenomenon of the Gamestop share, we begin our journey with a history of the share price in a few key dates.

Gamestop is not a recent player in the video game world. Its creation dates back to 1984 with a specialisation in the distribution of video games and sale of electronic equipment. The 2 founders are Gary M. Kusin and James McCurry. It is a prosperous company which has established itself all over the world with 7117 points of sale through numerous subsidiaries.

Gamestop shares have been listed on the New York Stock Exchange (NYSE) since March 1, 2002. Its initial price is around $10.

Until 2005, the Gamestop course did not take off. It is stagnating around its starting price. It's a long time to consolidate market capitalisation and cash flow. This is the first bullish phase of the GME title with a first historical peak at 63.68 dollars on December 24, 2007. Over a period of 2 years, the unit price has been multiplied by 6, ie an increase of 530%.

Unfortunately, the global financial crisis of 2008 did not spare Gamestop Corp. The collapse of the Gamestop course takes place in two stages. A first downward phase with a low around 46 dollars in the first quarter of 2008. A slight recovery until mid 2008 with a price around 55 dollars. Then the real fall with a price per share of around 23 USD in November 2008. For nearly 5 years, the stock did not reach the threshold of 30 dollars.

The following bullish phase had already started in 2012 with the payment of the first dividends in the history of the company. Proof that the financial results were positive. During the last quarter of 2013, the price of Gamestop shares climbed back to $ 55 apiece with stabilisation around $45 until October 2015.

Unfortunately this improvement does not last forever. Long bearish phase hits Gamestop Corp. The GME share price is falling endlessly. A new all-time low was hit on August 19, 2019 with an opening price on the NYSE at $3.37. A bullish phenomenon is starting to set in during the COVID 19 crisis. The action is climbing back to around $20. In the space of 6 months, the stock has risen by + 650%.

January 2021 is a turning point in the history of the company's listing on the stock exchange. For several weeks, the share gains in value following the combined action of individual investors wanting to undermine financiers.

💰 To buy Gamestop shares costs 325 dollars on January 25, 2021. Since this short squeeze, the share price has fluctuated but seems to have stabilised around 160 USD.

How to invest in a Gamestop share?

Now that we have an overview of the evolution of the quoted share price on Wall Street, we will detail step by step how to buy GME shares. 4 main steps that can be found in all regulated brokers on the market. We highlight 3 of them - eToroXTB - because they are in our opinion the best options for doing online stock trading.

The steps to invest in a Gamestop share

🔎    Step 1: Choose a stock broker

✅    Step 2 : Open a trading account

💰    Step 3 : Deposit funds

🛒    Step 4: Buy Gamestop shares

67% of retail investor accounts lose money when trading CFDs with this provider. You have to ask yourself if you can afford to take the high risk of losing your money.

Step 1: Choose a stock broker

trading shares on etoro

The choice of your broker is surely the essential step not to be neglected to be assured of trading online with the best security and investment conditions. Buying on the Gamestop stock exchange must balance a complex equation between brokerage fees, the level of risk tolerated, the real money capital available and the established investment strategy. The 3 brokers presented below have undeniable advantages for buying Gamestop shares with complete peace of mind.

 

The broker eToro is the leading online trading platform for CFD-type derivatives.

It collects many positive opinions from its users for a multitude of reasons: its social trading platform which allows you to copy experienced investors, its ultra competitive rates on the forex market, its user friendly platform or the possibility of trade GME shares directly via an Ordinary Securities Account (CTO), or via CFDs to take maximum advantage of both upward and downward volatility with the application of a leverage effect. Acquiring Gamestop Stock Exchange US shares is an operation carried out in a few clicks and in complete security for the clients of the broker eToro.

We have summarised our review of eToro with its main advantages and disadvantages presented in this table:

Although it may seem obvious to some trading experts, it is essential to carefully choose the online broker who oversees all transactions relating to the purchase and sale of shares. This choice must be made according to several criteria of varying importance. In our opinion, it is crucial to pay close attention to the weight of trading fees and commissions, the quality of customer service and the reliability of the online platform.

To buy an Apple, Gamestop or even EDF share, we have chosen 3 versatile brokers who have proven themselves technically for many years and who collect excellent opinions from their clients: eToro, XTB.

ADVANTAGES

✅     Social trading platform with automatic position copying

​✅     Wide range of assets: forex, stocks (CFDs and live), ETFs, stock indices, commodities and                   crypto currencies (Bitcoin)

✅     Broker regulated in more than 150 countries around the world (FCA, MAF, CySEC)

✅     Popular mobile application in addition to web platforms via MetaTrader

DISADVANTAGES

❌     Not suitable for professionals / Limited technical analysis tools

❌     Sometimes high equity CFD spreads

❌     Customer support sometimes slow

67% of retail investor accounts lose money when trading CFDs with this provider. You have to ask yourself if you can afford to take the high risk of losing your money.

Step 2: Open a trading account

To open a trading account with each of the brokers presented above, a few steps must be followed to buy securities from the video game company:

  1. Click on the registration button and fill out the form with personal data: name, surname, address and country of domicile, telephone, email address;

  2. Complete the KYC (Know Your Customer) questionnaire for a live assessment of the level of stock market knowledge, which allows the broker to give recommendations regarding investment risks;

  3. Send the documents required to verify your account with customer service: identity document (CNI, passport) and proof of address (tax notice, water bill, etc.);

  4. Deposit your investment capital;

  5. Buy GME shares.

Step 3: Deposit funds

Investing money via a stock exchange intermediary requires funding your trader account with a capital of personal funds. Regulated brokers offer different ways to transfer money from your bank account to the available balance.

To do this, go to the financial section of the customer area by clicking on the Deposit section. Then all you have to do is determine the amount to be transferred. The minimum amount of money varies from broker to broker:

  • 200 euros for eToro;

  • No threshold at XTB;
     

Trading methods also vary from platform to platform. The most common are:
 

  • Visa / Mastercard credit card (or even American Express);

  • Transfer from his bank account (2 to 3 days of processing);

  • Skrill / Neteller type electronic wallet;

  • Paypal (eToro);

  • Alternative payment solutions.

Step 4: Buy Gamestop shares

To purchase GameStop shares, we will follow the procedure available from eToro. Namely that it is relatively similar to other regulated brokers.

To do this, the trader goes to the Markets section. Either he carries out a search in the section reserved for actions, or he types directly in the search bar the name of the product: GameStop Corp or GME.

The user only has to select his asset by double clicking on it. A new page opens where you have to enter the amount of money to invest. For a cash purchase, only the Buy function is to be considered. No leverage to define. It is also possible to determine the levels of Stop Loss (minimum price to limit losses) and Take Profit (maximum price to cash in profits). As part of a cash transaction, the line directly integrates the CTO wallet provided by eToro.

In each of the 2 cases, the transaction is validated when the client clicks on Place an order.

💰 If the client wishes to speculate on the trend evolution (up or down), from the same page he defines the amount of investment, the level of leverage (up to 5:1) and the levels of Stop Loss and Take Profit. If the trader foresees an uptrend, he clicks Buy. If, on the contrary, he considers that the price will be down, he chooses the Sell option.

Why choose the Gamestop Share?

Now is the time to determine what a great opportunity to buy GameStop titles is. We have summarised several reasons that explain his potential interest in having one in his wallet.

It is worth remembering that Gamestop Corp has experienced difficult years despite an economic model that had many advantages: small business with low overheads with an international scope. Unfortunately, the advent of dematerialised digital products as well as consecutive economic crises have undermined the solidity of the group specialising in the sale of video games and consoles.

However, the coronavirus pandemic leads to projections in its favour since the return to normality could lead to a greater consumption of leisure activities at home, and therefore an increase in sales of video game products.

Partnership with Microsoft

 

The other point lies in the partnership established between GameStop and Microsoft for the launch of the new Xbox. More outlets and a wider consumer audience. So more income.

The releases of new generation consoles (Xbox and Playstation) have a boosting effect on sales as players change machines and acquire new titles. A welcome boost in Gamestop's cash flow.

Finally, the short squeeze launched by the Reddit community in 2021 demonstrated that the solidarity of individuals could make the difference on the steamroller of globalised finance. This put a very positive spotlight on the video game company, which gave the share price a huge boost.

In a nutshell, a short squeeze is an epiphenomenon in the stock market where the fund trend is down with little commitment from investors. Some positive news published leads to renewed optimism, which increases the number of interested buyers. In the case of Gamestop, no specific news, but a dynamic launched on the Reddit site. Millions of individual traders have purchased securities. The sellers at a loss were forced to close their positions, which suddenly created a colossal gap between supply and demand. Via a snowball effect, the share price exploded in a few days.

The main consequence is that there is now very high volatility on the GME share. There are therefore multiple opportunities that present themselves for daring traders, who like to play with leverage on short-term maturities. In the event of a collapse, short sales should be entered. Intermediate rebounds are also an opportunity to position yourself at different times. These 2 scenarios are the assurance of very interesting gains. Day trading and scalping trading should be seriously considered with eToro with strict money management.

Finally, it is fashionable to wait for the stock price to fall again before purchasing it as part of a long-term strategy. Despite everything, in our opinion, it is more a question here of an investment of conviction.

GME company information 

gamestop trading info for public

Dividends from Gamestop shares 

For several years, the Gamestop company has paid significant dividends to its shareholders. During the 2010s, business was booming for the video game retailer. It is therefore natural that the group chooses to reward. Despite the many financial crises, GameStop continued its policy of payment with a rather interesting return year after year. 

Here are some examples to realise the distribution policy of the company listed on Wall Street. The assurance of an annual passive income:

  • As of February 16, 2012: dividend per share €0.15 / Yield: 3.39%;

  • As of March 4, 2016: dividend per share €0.37 / Yield: 5.41%;

  • As of March 14, 2019 (the latest): dividend per €0.38 / Yield: 3.95%.
     

Despite disappointing results, Gamestop strives to support its shareholders through dividends that have been maintained or even consolidated over the years.

67% of retail investor accounts lose money when trading CFDs with this provider. You have to ask yourself if you can afford to take the high risk of losing your money.

CONCLUSION: SHOULD YOU BUY A GAMESTOP SHARE?

We are not going to lie to each other. Buying a Gamestop share remains a risky bet. In any case in the long term. 

We saw clearly with the Reddit investor case that it was possible, over short periods of time, to cash in large profits thanks to the high volatility of the security. Right now, the stock price appears to be stabilising around $160. However, it still seems too early to invest our money in this value. A price correction should take place, which will cause the unit price to fall. A golden opportunity for long-term investors to purchase at a more attractive price, especially less risky for their wallet.

If the company does not evolve in its business model and method of selling (moving from physical products to digital), there is a good chance that the Reddit bubble will explode and that it will leave carefree traders behind. The publication of results at the end of 2021 should give a general direction of the trend to come. 

2 positive elements are, however, already to be taken into consideration: sales of consoles, accessories and video games linked to the release of new generation machines and the partnership with Microsoft for a wider range of customers.