How to buy Boohoo (BOO) shares

When Carol Kane and Mahmud Kamani co-founded Boohoo (LON: BOO), nobody expected it to grow so fast.

Initially, they targeted the 16 to 30 demographic. By acquiring defunct high-street brands like Burton, Karen Millen, and Dorothy Perkins, they quickly grabbed the attention of older shoppers, who have more spare cash to spend on clothing and accessories.

If you want to invest in this dynamic fashion business, our step-by-step guide has everything you need to know about buying Boohoo shares.

Step 1: Choose an online broker

There are a lot of brokers you can choose from, but whichever broker you decide to use must have access to the London Stock Exchange in order to buy Boohoo shares (because that’s where they are bought and sold).

Features to consider when selecting a broker include the brokerage fee, foreign exchange fee (more relevant if you want to buy international shares), if you can buy fractional shares (giving you easier access to more expensive shares and improved diversification), plus what markets and instruments you can trade (for example, shares, ETFs, options, CFDs, forex, etc.).

Something that should be taken intro consideration — and is often overlooked — is the trading experience. Ideally, a broker should be easy to use, available online and on mobile, and packed with useful information.

Step 2: Deposit funds in your account

Once you've selected a broker, you’ll need to complete registration and deposit funds in your trading account.

You can fund your account with a bank transfer or debit card. Credit cards are accepted by some brokers.

There may be a minimum deposit requirement. If there is one, it is generally quite low.

Step 3: Decide how you'd like to spend

Since shares can fluctuate in price, it’s important not to invest any more than you can afford to lose.

You can build your position in Boohoo over time with regular investments. This strategy, known as pound cost averaging, has the added benefit of reducing the average cost per share.

Step 4: Choose whether to purchase shares of an ETF or shares

ETFs expose you to a specific group of companies that the fund has invested in. There are thematic funds for most interests. While ETFs are regarded as less volatile compared to hedging your bets on the performance of a single company, they are not immune to market volatility either.

ETFs that have exposure to Boohoo shares include iShares MSCI EAFE Small-Cap ETF (SCZ) and iShares Core MSCI EAFE ETF (IEFA).

Step 5: Configure your order

A market order is the most basic form of order. Once submitted, the broker will buy or sell at the next market price.

Most brokers also support a range of more complex orders that can be automatically triggered, typically by a change in price.

If you want to build your investment in Boohoo, you could set up a recurring order to buy more shares on a regular basis.

Step 6: Place your order

To buy shares, submit your order once you’re satisfied with how you’ve configured it.

News stories can negatively or positively impact the value of your shares, especially for a brand like Boohoo and its young and engaged customer base. Also, keep an eye out for company results and announcements to the market, what their competitors are doing, and what employees are saying about the company on websites like Glassdoor.

Given Boohoo’s online presence, changes in its visibility on platforms such as Google and Facebook can have a material impact on Boohoo’s performance.

For a broader understanding of Boohoo’s market and their positioning in it, track the performance of predominantly online fashion retailers like ASOS (NASDAQ: ASOMF) and The Hut Group (LON: THG).