Kogan.com Ltd (ASX: KGN) is an Australian online retail and services business that is traded on the Australian Stock Exchange (ASX). The company was founded in 2006 by Ruslan Kogan and went public in 2016. It is headquartered in Melbourne.
If you want to buy shares in Kogan, this is your step-by-step guide.
About the company
Kogan’s diversified portfolio includes Kogan Retail, Kogan Marketplace, Kogan Mobile (credit cards, super, and home loans), Kogan Internet, Kogan Insurance, Kogan Health, Kogan Pet Insurance, Kogan Life Insurance, Kogan Travel, Kogan Money, Kogan Cars, Kogan Energy, Dick Smith, Matt Blatt, and Mighty Ape.
There were over 3.9 million active Kogan customers as of mid-2021. The company emerged from the COVID-19 pandemic with strong revenue and profit growth.
Kogan subsidiaries include Mighty Ape Limited (New Zealand), Mighty Ape Australia, Kogan US Trading Inc (United States), Kogan HK Limited (Hong Kong), Dick Smith IP Holdings Pty Ltd, Matt Blatt Pty Ltd, and Kogan Operations Holdings Pty Ltd, among others.
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Step 1: Choose a broker
A broker is an intermediary that helps you buy shares online. There are many online brokers providing various options. Make sure the broker has access to the Australian stock exchange in order to buy any shares in Kogan.
Here are some things to consider when choosing an online broker.
Brokerage costs have plummeted since online share trading became popular. It's possible to find very competitive brokerage rates on online platforms if you shop around. Be sure to compare brokerage costs with other services the online trader may or may not offer.
Easy-to-use trading platform
Share trading doesn't have to be difficult, so look for a platform that’s simple to use.
Research and reporting
Look for platforms with a strong research and reporting section that can provide you with important information on Kogan, including company overviews, price histories, recommendations, and price forecasts from analysts.
Step 2: Funding your account
You'll need to add money to your account to start trading. Minimum investments vary between brokers. The funds will have to be transferred from your bank account, and it may take around three days for them to clear.
Step 3: Decide how much you want to invest
The first, and very important, step in investing is to decide how much you are willing to risk. Make a budget for buying shares and only spend what you can afford to lose since share prices are volatile.
Step 4: Choose between buying shares or an ETF
If you are a more cautious investor, another option is an ETF (Exchange Traded Fund), which lets you invest in a market sector or in a specific commodity, as opposed to an individual company like Kogan. Because the product tracks a whole market, there's less chance it will experience sudden falls or rises, but you'll also have a harder time making the big gains that occasionally come with shares.
ETFs with exposure to Kogan include BetaShares S&P/ASX Australian Technology ETF (ATEC) and Amplify International Online Retail ETF (XBUY).
Step 5: Decide your order type
If you’ve decided to buy Kogan shares, these are some of the main order types available to execute your trade.
These are orders to buy shares at the current market price. These prices can change while you're trading in fast-moving markets. Let's say you place an order to buy Kogan shares at $9.15 You place an order, but by the time it executes the share price has dropped to $9.12. You will get your shares at a lower price. The same situation applies if the share price goes up while your order is being executed.
With a buy limit order, your trade will only execute when the share price reaches the price, or lower, that you nominate. Let’s say you decide you only want to buy Kogan shares at $9.14 or lower. Once the price drops to $9.14, your limit order will kick in.
A stop-limit order is an order to buy or sell a stock, combining the features of a stop order and a limit order. For example, you might place a stop limit order to buy 100 shares once the price reaches $9.15 (the stop) with a limit of $9.20. Or, you might place a stop limit order to sell 100 shares if the price drops to $9.12 (the stop) but with a limit of $9.05.
This helps you reduce risk. With a stop-loss order, you nominate a price at which you decide to sell your shares. If the share price goes into freefall, for example, the stop loss means you sell out before your shareholding suffers too much damage.
Step 6: Place your order
Once you've made all your choices, it's time to place your order. Open up your trading platform, type in the Kogan share code (ASX: KGN), and execute the order with the features you've chosen.
Whether you are investing in shares to hold them as a long-term investment, or with a speculative motive to benefit from share price fluctuations, you still need to monitor the company’s performance and share price movements.
Track Kogan’s performance
Keep track of Kogan’s business performance and financial fundamentals in addition to watching its share price movements. With dividend stocks such as Kogan, it’s a good idea to watch for the trend in dividend payments. Kogan is a diversified business that grows with acquisitions. It also has fully-owned subsidiaries in a number of countries.
Kogan faces strong competition from local and international operators and brands in most of its product and service businesses.
The ecommerce and shopping marketplaces Kogan competes with include Harvey Norman, eBay (NASDAQ: EBAY), The Good Guys, Catch.com.au, Amazon (NASDAQ: AMZN), MyDeal.com.au, Kmart, Big W, Myer and Target, among others. It also competes with more specialised financial services, electronics and travel companies.
Disclaimer: We put our customer’s needs first. The views expressed in this article are those of the writer’s alone and do not constitute financial advice. Advertisers cannot influence editorial content. However, Finty and/or the writer may have a financial interest in the companies mentioned. Finty is committed to providing factual, honest, and accurate information that is compliant with governing laws and regulations. Do your own due diligence and seek professional advice before deciding to invest in one of the products mentioned. For more information, see Finty’s editorial guidelines and terms and conditions.