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South Korea-based e-commerce company Coupang (CPNG) could experience rapid growth in this hot market. Based in Seoul, South Korea, Coupang filed for its IPO on February 12, 2021, and will trade under the ticker symbol CPNG.
Interested in investing in a new player in the e-commerce space? We’ll walk you through the steps so you can buy CPNG or learn how to buy stocks in general.
How to Buy CPNG IPO Stock Summary:
Now that Coupang has filed for its initial public offering (IPO), you can trade its shares the same way you would any other stock. Buying shares in CPNG requires 3 simple steps, but each step will require you to make some important personal decisions:
- Choose a brokerage service. Before you can buy a publicly traded company like CPNG, you need to open a brokerage account. Define your individual investing goals before selecting a brokerage.
- Deposit funds. Once you open a brokerage account, deposit money you want to trade. Some brokers offer instant trading before your funds settle, so if you want to buy CPNG today, choose a broker that allows this.
- Search for CPNG shares and hit “buy.” Only risk a small portion of your account so you minimize risk to your portfolio.
How to Buy CPNG Stock
The e-commerce space has been one of the hottest sectors since the COVID-19 pandemic expanded worldwide last March. Nearly 37,000 employees and a $2 billion investment from SoftBank means Coupang could become the Amazon (NASDAQ: AMZN) of Asia.
Buying a Stock like Coupang (CPNG) right after its IPO date carries additional risks. With any company that has recently gone public, extreme market fluctuations could occur as investors determine its fair market value. Keep this in mind as you think about buying shares of CPNG.
- Pick a brokerage.
Before you buy shares of CPNG, you first need to pick a brokerage to invest with. Most brokerage firms have switched to a commission-free model, so you can buy shares of CPNG free of charge.
Pay attention to any promotional offers that these brokers offer. Doing so could net you some free stocks. Furthermore, if you want to practice trading before you act on the real thing, select a brokerage that offers paper trading.
- Decide how many shares you want.
Next, you need to decide how many shares of CPNG you want to purchase. Keep your investing time horizon, your account balance and your risk tolerance in the back of your mind.
You don’t want to invest any more than a small percentage of your overall account balance in one stock, especially when that stock is a recent IPO. Define the price point you want to sell your shares at in the future.
Now that you have taken these considerations into account, look for a good price to enter into your position.
- Choose your order type.
Now that you know how many shares of CPNG you want to buy, you must select the appropriate order type. A limit order allows you to define the exact price you want to buy and a market order gets you into CPNG as fast as possible at the current market price.
A recent IPO such as Coupang (CPNG) shows extreme volatility, so it may be wise to use a limit order so you can better control your risk.
- Execute your trade.
After choosing an order type, all you need to do is hit “buy” and your broker does the rest. Once your broker processes and fills your order, your shares of CPNG will show up in your account.
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Coupang Stock History
Coupang (CPNG) does not have a very extensive stock history, as the company just filed paperwork for its IPO on February 12. However, it was founded in 2010 by Bom Kim. Since then, CPNG has experienced explosive growth including the SoftBank Vision Fund’s $2 billion investment in 2018. By 2020, total revenue for CPNG reached nearly $12 billion, more than a 90% increase from the year before. All in all, the largest e-commerce play in South Korea could be poised to make a big splash on U.S. markets.
Pros to Buying Coupang Stock
You can find several risks to investing in an e-commerce company like Coupang, but you can also reap rewards from:
- Continuing COVID-19 restrictions: While some of the more restrictive lockdown measures have been relaxed since last spring, the majority of people still spend much of their time hunkered down at home. As a result, e-commerce companies will likely continue to see massive upside potential in 2021.
- Major investing partners: In November of 2018, Japan-based SoftBank invested $2 billion into Coupang. SoftBank invested in Uber, Lemonade and Slack Technologies as well. Other major institutional investors in the company include Fidelity and BlackRock. If these major players maintain their investment in CPNG, the stock could jump up for a major run in 2021.
Cons to Buying Coupang Stock
Check out the reasons you may want to hit the pause button on buying Coupang:
- Lockdown measures wind down: As more and more people around the world continue to get vaccinated for COVID-19, the pandemic will die down. While many people have likely permanently converted to shopping online, some consumers may prefer a return to brick-and-mortar stores in the latter half of 2021. If the COVID-19 pandemic doesn’t stay a concern in late 2021, e-commerce plays like CPNG could decline in value.
- Market risks: Investing in any recent IPO presents added risks compared to long-standing stocks, especially when the stock market shows all-time highs. If the stock market corrects in 2021, the share price of CPNG could experience declines as well.
Jump on the IPO Bandwagon Carefully
All in all, buying shares of Coupang (CPNG) after its IPO could remain an appealing investment. Over the last year, Amazon (AMZN) has experienced massive increases in share value, as have JMIA (the Amazon of Africa) and OZON (the Amazon of Russia). If market conditions remain right, Coupang (CPNG) could become the next big e-commerce play.