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www.etoro.com *
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How to buy
For those who live in Philippines, a great way to invest in McDonald's shares is, definitely, this popular broker.
eToro*, one of the main brokers around the world, is registered and licensed, among others, by the Cyprus Securities and Exchange Commission, and therefore complies with all the regulations of the European Union, the most demanding in the world.
We recommend eToro because you can create an account for free with this broker, and its fees for trading online are very low. Besides, eToro is available in our language, accepts users from Philippines, it is really easy to manage, and its friendly interface is ideal for those who are starting to trade with cryptocurrencies and stocks.
How to sign up, step by step
The first thing you need to do is click here and fill in the fields on the right: enter your name, email, and set a password.
Now check your email inbox: you should have received an email from eToro, click on the button and your account will be verified.
Once on eToro, you just have to click on “Deposit funds”, in the page menu.
There, you can choose how much money you want to add to your account (the minimum is $ 200) and the payment method:
As you can see in the image, the first deposit can be made by credit card, PayPal, or bank transfer.
If you have a choice, we do not recommend bank transfer because it takes longer, and it can be very frustrating to see the price of McDonald's rising while you wait for your transfer to be done.
How to make your first trade
As soon as eToro has confirmed the receipt of your credit, you just have to search for “McDonald's” in the search bar, click on “Invest” and choose the amount in dollars you want to invest.
*67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money
Cryptoassets are highly volatile unregulated investment products. No EU investor protection. Your capital is at risk.
Contents
About the company
McDonald's Corporation is an American company known for its hamburger restaurants around the world. It was founded by brothers Richard and Maurice McDonald in 1940, who first implemented the fast food concept inspired by Henry Ford.
Initially, the McDonald brothers did not have as broad a business vision as the company has today. It was Ray Kroc who would take the company to success, becoming the first successful McDonald's franchisee in 1955.
By 1960, Kroc would buy the company from the McDonald brothers for 2.7 million dollars, thus becoming the owner of the company. Since then, the company has grown to more than 36,000 restaurants in 118 countries. Ray Kroc turned the company into one of the most successful companies worldwide, although its real business is not hamburgers.
McDonald's business model: hamburgers or real estate?
Although McDonald ‘s is a fast food restaurant chain that primarily sells hamburgers, most of its revenue does not come from selling food, but rather from renting its properties, i.e., real estate.
Only 5% of the restaurants are wholly owned by the company, the rest are franchises that operate almost like any other well-known franchise. That is, the franchisee pays the brand (McDonald's) to have the rights to use the brand to make a profit.
Thus, McDonald's gets paid for the franchise, is the supplier of the restaurant and also gets a share of the monthly profits of each restaurant. But in addition to this, McDonald's gets paid rent for the space where the franchise is located since the company owns all the locations.
Each time a new McDonald's opened, the company would first buy the land and fit out the location and give the franchisee the finished restaurant. Thus, the franchisee is only responsible for the management and operation of the restaurant.
This is how McDonald's came to own more than 36 locations that it rents to its franchisees as part of the franchise agreement. And that is why, although the company only fully manages 5% of the restaurants, it generates annual profits in excess of 20 billion dollars.
And this allows it to offer attractive dividends to holders of company stock (dividends are the portion of profits distributed to investors) that have historically increased year after year. As a result, McDonald's is a company that every investor tends to include in his or her portfolio.
About Contracts for Difference
You probably have found the term CFD more than once if you already accessed eToro. We will come back to it, but first, you should know that cryptocurrency operations on eToro are only CFDs when you short sell or choose leverage over x2 (and this is not even available on the platform).
In case you want to know about day trading cryptocurrency and other advanced practices, next you will also meet concepts like short-selling and leverage.
eToro lets you bet both “in the black” and “in red”. For instance, you believe that the McDonald's will go down, so perhaps you think that it is better to wait until it does and then go in. However, if it actually falls, you can make some profits out of that.
You can do this through what is known known as “going short”. Its operation, roughly, works like this:
- You ask someone to lend you, for instance, 100 units of McDonald's, which total price at that moment is $ 5,000 (these numbers are made up)
- You make $ 5,000 by selling them at the market price
- The price is reduced, as you calculated, and the unit of McDonald's goes from $ 50 to $ 30
- You obtain the 100 units again, but at their current price, $ 3,000
- You return the 100 units
- You will have made $ 2000, since you keep the difference
It all seems more tricky than it really is. Just bear in mind that by trading in McDonald's on eToro, with CFDs you can earn money when you anticipate the price will fall.
How to deposit funds into your eToro account
When it comes to depositing funds on eToro, there isn't really much to say, since it is really straightforward. You only need to select “Deposit funds”, set an amount, and choose the payment option you prefer. You can pay with PayPal, bank transfer, credit card (Visa, MasterCard, Diners, Visa Electron and Maestro), Skrill, or Neteller.
(Keep into consideration that you should be the account or credit card owner, for security policies).
You can start from $ 200, and if you are not verified you will have a maximum amount allowed. Thus, if you intend to operate with much more, you should contact Support to verify your account first.
eToro accepts transfers in any currency, but you will have to pay a fee for the conversion to USD. That is why we suggest, if possible, using USD from the beginning.
How to use eToro
We mentioned previously that eToro is very easy to manage. Anyone can start using it without having to read endless explanations.
Everyone who has previously used Twitter, Facebook or any of the most common social networks, has enough knowledge to operate with the eToro interface.
We will explain the registration steps and the different tabs that you will see.
You will have to fill in some information requested when registering.
Before you end up with the sign-up process, you will also have to answer some questions about your previous experience as an investor.
But don't feel like you are taking an exam. The objective is to know more about you and determine which financial instruments they should suggest according to your knowledge and experience.
Let's review the different functions of the page.
In “Set Price Alerts” you can set alerts on the price of certain securities. You just have to click on the three points at the end of the line and you will be able to program a price alarm. This is very useful when you want to buy a security that is falling, but perhaps you think that it has not finished falling yet.
In the “News Feed” tab is the most social part of eToro: where users are interacting all day and sharing valuable information.
“Instruments”, “People” and “CopyPortfolios” are within “Discover”. As we mentioned in this guide, the different financial assets that eToro offers are:
- Cryptocurrencies
- ETFs
- Shares
- Raw materials
- Forex trading
- Index funds
The term “social trading” makes sense within “People”: that is where you can duplicate the movements of any user you choose with just one click. You'll be able to see all their profiles and historical performances.
You can search and find users according to your interests. When you select an investor and indicate how much money you want to invest, eToro will automatically replicate their movements, in proportion. For example, if you have $ 1000 and the trader puts 20% of their funds in an asset, eToro will also invest 20% of your money in the same asset, in this case, $ 200.
You will also find the CopyPortfolios divided into three main categories: “Top Trader”, “Market” and “Partner”.
Sometimes it might be better to copy from CopyPortfolios than to other traders, since you avoid putting all your eggs in one basket, or in other words, risk is more diversified. Besides, the different portfolios are easily identifiable: one about gaming, another about large drone companies, another about pharmacy … Do you suspect that a certain industry is going to have success in the future? Then look, because surely there is a CopyPortfolio about it.
What is social trading?
eToro was the first platform that proposed social trading, and this new concept turned out to be brilliant. Many other brokers copied this idea, but eToro beats them all.
But it wasn't just about creating yet another social network to talk about investment. The main achievement was in allowing users to replicate the moves of experienced traders, who were in turn paid for their ideas.
You will find in the left menu of the site the options “Copy People” and “Invest in CopyPortfolios”.
CopyPortfolios
“CopyPortfolios” contain a collection of financial assets of a certain sector. For instance, if you consider that a particular sector will have significant profits but you don't know which stocks to invest in, you just have to select a portfolio that includes a variety of related companies in that industry.
You should know that in the past year, CopyPortfolio has generated returns of 100%. And you can benefit from it just by choosing a portfolio, enter your selected amount, place the stop-loss and click on the “Invest” button.
Copy People
But you can also copy other users of the platform who are successful investors. It is really simple: you can find them with “Copy People” and just duplicate their strategies.
You will find in the profile of users: the kind of financial instruments they operate, their risk profile, as well as their performance history.
Besides copying other investor's moves, which is really interesting and helpful, we also recommend that you benefit from the community by reading other users. You can learn a lot from their experiences, particularly if your goal is to make a living from trading.
Trading strategies
You can trade cryptocurrencies using several different methods: for example, you can buy and hold, or you can day trade (taking advantage of market volatility).
If you are just beginning in the world of trading, our recommendation is a middle point: when you open your McDonald's position, set a dynamic stop loss 15-20% under the highest price, and let the magic happen.
For example, if you buy a cryptocurrency when its price is $ 15, then it rises up to $ 25 and decreases back to $17, the stop-loss will close your position at $ 21 or $ 22. Thus, you will obtain a fine profit.
Perhaps you are wondering: why not selling back when the cost is at its peak? But unless you are a psychic, that is just impossible. The mentioned strategy can work perfectly and give good results.
Later on, you will be able to apply more sophisticated techniques, like using leverage or going short.
How does a virtual portfolio work?
Are you beginning in trading? Using a demo account can be useful. You just need to set the virtual mode and you can start practicing with a “fictional” balance.
A virtual account can help you to practice and gain experience before starting to trade with real funds. When you create your demo account, you will begin with a virtual balance of $ 100.000, to operate with a variety of assets available on eToro, besides McDonald's.
Don't worry, since if you lose all your virtual funds, you can contact support so they can add them back to your portfolio and you can make a second attempt.
However, remember that investing is mainly about being cautious, and using a demo account can have an adverse effect. It is completely different to risk your own money than to operate with virtual funds that you don't mind losing. Also, using fake money can prevent you from learning to control your emotions, something you should be able to do when trading.
And of course, the demo mode is kind of absurd if you intend to invest in the medium or long-term, since you would be wasting years. Demo accounts may be helpful for practicing before trading in the short or medium-term.
Common questions
* Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Disclaimer: 67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.