If you have long been interested in the subject of investment, but this business seemed inaccessible to you due to lack of funds, knowledge and qualified education, now there are all opportunities to realise your dreams. Thanks to modern Internet technologies, investment is available in every household where there is a laptop (or other device) and access to the "World Wide Web". Online investment platforms help start the stock market for almost everyone on the planet, even in the remotest corners of the smallest provinces.

In this short article, we will look at the options for investing in Netflix stock in Pakistan.

Netflix, Inc. - is already a common name among companies that provide video streaming services. Founded in 1997 by Reed Hastings (current Chairman and CEO) and Mark Randolph, Netflix has become a global leader in its field (operating in over 190 countries) and one of the most successful US public companies. 

As of 1 November 2019, Netflix's market capitalisation is $125.69 billion. Netflix's streaming service has the world's largest database of video content, consisting of online streams of movies, series and television shows, including those produced in-house. At the end of the third quarter of fiscal 2019, the number of Netflix paid subscribers in the US reached 517,000, and the number of international paid subscribers was 6.26 million. In fiscal year 2018, Netflix earned $ 15.79 billion and a net profit of $ 1. 21 billion However, the company spends a lot of money on creating its own unique content, filming movies, series and shows. In addition to a huge content base and international presence, Netflix's competitive advantage over other video streaming services is the lack of advertising.

According to Netflix, in 2020, a total of 37 million people subscribed to the paid streaming service, up from 28 million the previous year. This was facilitated by pandemic and quarantine restrictions.

A total of 203.7 million people worldwide watched Netflix subscription streaming at the end of last year.

Today, Netflix is the world leader in online entertainment content, and Netflix shares in the period from June 2016 to April 2020 showed a 373% increase.

This data greatly appeals to investors.

Information about the Netflix shares on the platform
Information about the Netflix shares on the platform

How to invest in Netflix shares in Pakistan?  

Due to the fact that Netflix once attracted many investment funds, today the issuer has a large amount of liabilities on its balance sheet. The high debt burden, which requires interest and principal payments on loans, prevents Netflix from paying dividends to shareholders in cash. However, following the company's successful year, Netflix believes that financial income will now exceed the company's needs and it will not have to borrow money to support the strategy.

Netflix shares on the NASDAQ aftermarket soared 12.6 per cent to $565.05 a share.

How to buy Netflix shares?
How to buy Netflix shares?

Many analysts predict that the company will resume dividend payments to investors in cash. Thus, in the summer of 2015, investors, as dividends, instead of profits in monetary terms received new securities, which were issued at the cost of an additional issue. For this purpose, the company was divided into shares in a ratio of 7 to 1. This means that for one Netflix share, the investor received 6 new shares. In the future, it is likely that after reducing the debt burden, the issuer's management will decide to pay cash dividends to all owners of the company's securities.

Alternatively, you can trade the contract for difference (CFD) for a particular stock and speculate on the difference in the price of the underlying asset without actually owning the asset. A CFD is a financial instrument, usually a contract between a broker and an investor, where one party agrees to pay the other party the difference in the value of the security between the opening and closing of the transaction. You can hold a long position (assuming the price will go up) or a short position (assuming the price will go down).

This is considered a short-term investment or trade because CFDs are generally used in a shorter time frame.

The main difference between trading a long position with a CFD and buying securities is the leverage used. CFDs are traded on margin, which means that a trader can open larger positions with his initial capital.

You can work with the securities of this US issuer through a broker, which allows you to trade the assets listed on the NASDAQ trading platform.

Find information on the Internet about all brokers who work in Pakistan online and work with Netflix stocks. To choose the best broker, you should gather information about the brokerage firm's activities. First, find out if the brokerage firm operates legally, i.e. if it has all the necessary documents, permits and license to perform brokerage activities on the stock exchange. Next, you should make sure that the trading platform offered by this broker, where you will work online, is convenient for you. See how to register, how to top up and withdraw cash, what trading tools the platform provides and how the feedback works. Find out how much commission the broker charges for the services provided to you. It is not superfluous to ask experienced stock market players how they evaluate the work of this broker from their own experience.

Once you have chosen a broker, you should register in the online trading system and start, in fact, trading Netflix shares.

Netflix Equity Trading Platform
Netflix Equity Trading Platform

How to buy Netflix shares in Pakistan?

To start working with the investment platform, you need to register. To do this, go to the website of the brokerage firm whose services you have decided to use and look for the "register" button. When you click on this button, you will see the standard registration form that you need to fill in. Enter all the information (usually just a username and a valid email address), click on the "register" button and wait for the email that the system will automatically send to the email address you specified earlier. Open the email and click on the link to confirm the email. After that, your account will be ready for use.

Registrating on the investing platform
Registrating on the investing platform

Immediately after authorisation in the system, you will automatically open a free demo account. This account is a test and training version of this account and is intended for training and testing operations. On the demo account you will see a certain amount of money. These funds are fictitious, i.e. you can use them to make certain trades to see how the platform works, but you will certainly not be able to withdraw these funds.

Don't neglect the demo account. This is an excellent and, most importantly, free opportunity to try your luck without losing your own money due to lack of experience. You can use the demo account for as long as you want, until you feel ready to try real trading.

How to open an account?
How to open an account?

To activate a real account, you must top up your account with a minimum amount of $10. To top up your account use your bank debit or credit card or any of the payment systems that the online platform works with. You can see a list of these payment systems by clicking on the "additional deposit" button. With the same systems, you can withdraw funds. Funds are almost always transferred instantly, but in some cases it can take up to five business days. When the funds arrive, the real account will be activated and you will see this amount in the real account balance.

Deposit replenishment
Deposit replenishment

Is it advisable to invest in Netflix shares in Pakistan? 

So, as we can see, investment is a science that requires a potential investor to understand certain patterns and processes, as well as constant training and deepening of knowledge. If you persistently study such processes, follow market trends, the behaviour of certain companies, you will eventually learn to analyse and forecast possible growth or decline in the value of the company's assets. This will enable you to make successful investments in the investment market and grow professionally as an investor.

So, to start investing, you need to:

  • find a decent online broker;
  • register on the platform for online investing;
  • open a demo account;
  • get acquainted with the platform and all the tools it offers;
  • get acquainted with educational materials online;
  • try to trade using a free online account;
  • follow the news about the company in which you intend to invest;
  • follow economic and political news in New Zealand, as well as in the country where the company is located;
  • follow the news on a global scale to understand global trends.

Netflix is one of the most interesting companies in the world to invest in. The price of its assets is constantly growing, as is the active audience. Convenient and affordable subscriptions, which provide access to a wide list of popular movies, TV series and shows, have provided the company with more than 80 million regular customers, in fact, they have created a full Internet alternative to cable TV, the cost of which is much lower than most traditional counterparts.

Therefore, we recommend you try investing in Netflix in Pakistan and experience all the benefits of successfully investing in a successful company.

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