Cash App has become a popular way for individual investors to easily buy and sell stocks commission-free. With its user-friendly interface and no account minimums, Cash App makes stock investing accessible to more people. When deciding what stocks to invest in on Cash App, it’s important to consider your personal investment goals, risk tolerance and time horizon. This article provides guidance on factors to evaluate when choosing stocks on Cash App as well as some potential stocks across various sectors for consideration.
Focus on long-term quality companies rather than speculation
Rather than speculation or trading, Cash App lends itself better to a long-term buy-and-hold investing strategy focused on quality companies. Look for established companies with competitive advantages, strong management, solid balance sheets and consistent earnings and dividend growth over time. Some examples across sectors include Apple, Microsoft, JPMorgan Chase, Johnson & Johnson and Home Depot.
Consider index ETFs for broad diversification
For those new to stock investing, index ETFs can provide a low-cost, diversified portfolio core. ETFs like VTI and VOO track the overall U.S. stock market while sector ETFs allow more targeted exposures. Just keep in mind ETFs trade like stocks so can’t be bought in fractional shares.
Take advantage of fractional share investing
One advantage of Cash App is the ability to buy fractional shares, making higher priced stocks more accessible. This allows investors to spread capital across more companies. For example, buying 0.5 shares of Amazon ($100) plus 0.5 shares of Alphabet ($100) provides more diversification than buying 1 full share of either.
Stick to larger, more liquid companies
Focus your stock portfolio on larger companies with higher trading volumes and market capitalizations. More liquid stocks can be more easily bought and sold on apps like Cash App compared to smaller companies. Liquidity is especially important if you need to access your funds quickly in case of an emergency.
Cash App offers an easy, commission-free way for new investors to dip their toes into buying stocks. Concentrate on buying quality companies or broad index ETFs aligning with your goals rather than speculation. Take advantage of fractional share investing to own pieces of great companies previously out of reach for smaller investors.