How to Buy HSBC Shares

We cover the British bank plus how to buy HSBC shares.

Updated: May 21, 2024
Matt Crabtree

Written By

Matt Crabtree

CompareBanks is reader-supported. When you click through some links on our site, we may earn an affiliate commission. Learn more

We are confident of achieving a return on tangible equity of at least 12% from 2023 onwards, which would represent our best returns in a decade. 

HSBC (Source)

Because the bank is “positively-geared” to a re-opening in China, Jefferies raised its price objective for HSBC at the beginning of January 2023, from 574p to 770p.

Jefferies said that China and Hong Kong account for 37% of loans and 36% of pre-tax profit, and it predicted that the re-opened economy will lead to increased demand for loans and general activity, both of which would be to HSBC's advantage.

An increase in loan growth in either Hong Kong or mainland China “should be accretive to the business” because of the somewhat higher net interest margins there.

With an expected 12% return or higher on tangible equity in 2024 compared to 0.8x TBV today, Jefferies sees genuine re-rating potential given the sale of the bank's Canada division, the investment bank said.

In this guide, we give a thorough breakdown of how to buy HSBC shares.

Fast Steps: 🚀 Want to buy HSBC shares? Click for the Sum Up section. 

Current State of HSBC Shares — HSBC News Update

With the ‘Collective West’, Eurozone, and United Kingdom in recessions, the United States showing some resilience but still expanding far below trend, and China offering little hope for a rapid or durable recovery, the global economy continues to decline.

Many are proceeding with caution into 2024, maintaining underweight in stocks while maintaining overweights in bonds and hedge funds. 

However, investors try to see the bright side of things and consider what can help us become more productive in the future. How does our perspective on the world impact the way we allocate capital? This is the question to ask. 

HSBC news update

HSBC released an interim report for last year. Here are the financials for last year compare to the year previous (Q2s). 

  • There was a $1.8 billion deferred tax benefit reported after taxes on the $5.8 billion net profit. There was no change to the $5.0bn in pre-tax profit that was reported. The effect of the net ECL charges compared to the net ECL releases in 2Q21 was mostly mitigated by the reduction in operating expenditures and the increase in revenues. The pre-tax profit on adjustments rose by 13%, to $6.0bn.
  • Interest rate hikes were the primary driver of the 2% increase in reported revenue to $12.8 billion; this gain was somewhat mitigated by unfavourable market movement effects in insurance manufacturing in WPB; the impact of currency translation; and losses on planned business disposals. Revenue was up 12% year over year to $13.1 bn after adjustments.
  • The increase in NIM from 1Q22 to 2Q23 was 9 basis points (bps).
  • Foreign currency translation had a 5% negative effect on reported operating expenditures. Our cost-cutting measures and our sustained discipline with spending helped dampen the effects of rising investment and prices. The cost of operations after adjustments remained at $7.5 billion.
  • The 12% growth in adjusted revenue and the stability in adjusted operating expenditures led to a 12% increase in adjusted jaws.
  • As a result of fluctuations in exchange rates, customer lending was estimated to be $27 billion less. Loans to customers, after adjustments, grew by $14 billion. This improvement was seen in every single area.

See the frequently asked questions down below for more facts on HSBC.

rUi6G5 oFzVmK2s pi4okNzJ1kiHWIhyXAl2TMD4UQ x1Fsd1gCZQru3qPmNNseb5IvQ7AhGBS7YSKueBnmUR0tv6GtQyOd8pzo0clQWqMkCY9U3t8KWUoNH5GqZ2gqYlplt4 aRFR8rSH3KPKYWv9Mj99nnnWEnaQA8pIlkQZBEXIKfcmo6e8Q

About HSBC Shares

In excess of 60 counties are serviced by HSBC's network of 3,900 locations worldwide. Based on data compiled in December 2018, the bank's assets were $2.558 trillion, making it one of the ten biggest in Europe and the seventh-largest in the world.

The company's roots are in Hong Kong and Shanghai Banking Corporation, which established operations in the region. In 1865, the company's first bank branches opened in Hong Kong, and the following year, in 1866, it was formally formed. Since its foundation, HSBC has prioritised employee and customer security as one of its core values. As a result, the market views it as a more diversified and defensive institution, less dependent on high-risk investment banking, than its competitors.

HSBC is one of the few corporations that have main listings on both the London Stock Exchange and the Hong Kong Stock Exchange, giving them access to a global investor base of over 200,000 people.

New York Stock Exchange, Euronext Paris Exchange, and Bermuda Stock Exchange are the four stock exchanges where the bank is listed. With a market valuation of £125 billion and a massive 7% stake in the UK's flagship index, HSBC shares are the most valuable corporation in the UK by a wide margin.

HSBC serves its roughly 38 million clients throughout the globe in four distinct divisions: Commercial Banking, Global Private Banking, Retail Banking and Wealth Development, and Global Banking and Markets. Its commercial banking division is responsible for extending credit to a wide variety of businesses, including subsidiaries and affiliates, as well as partnerships.

Investment banking, together with services in areas like foreign currency, money markets, and credit rates, falls within the purview of the global banking and market division. 

Private banking for high-net-worth individuals throughout the globe is what HSBC does best, and one of its four divisions is called “global private banking.” The company's retail banking and wealth management division is in charge of servicing customers who maintain checking, savings, and mortgage loans, among other retail banking products.

People who know what they are talking about don't need power Point.

Steve Jobs (Source)

How to Buy HSBC Shares — 1. Open Account

In case you’re a newbie to buying shares, we’ll start with the basics… 

A brokerage account is required in order to purchase shares of a company. Thankfully, there is a plethora of options available nowadays.

Selecting the best account is, ultimately, up to the individual. There is a wide range of services and costs associated with brokerage accounts, and brokers provide a variety of options. This implies that the least expensive broker for one person may not be the same for another. Your portfolio size, desired investments, trading frequency, and need for optional services all go into determining the best option.

Buying British shares will incur a fixed cost of about £8, and sometimes as much as £12. Many of them also provide rebates for monthly volume trading.

In most cases, investments made in other countries are encouraged. Knowing the additional expense and potential danger of varying currency conversion rates is essential.

In most cases, traders with bigger portfolios may save money by opening a trading account with a set charge, while traders with smaller balances are better off with a percentage-based fee structure.

Stamp duty is another expense to think about. There is a 0.5 per cent tax due upon purchase of shares but none upon sale. Notably, UK stamp duty is not required to be paid when purchasing smaller AIM-listed shares.

An investor may choose from many distinct trading accounts kinds:

  • Standard Trading Account: Enables customers to trade shares of any public business listed on exchanges serviced by the broker.
  • Individual Savings Account (ISA): When you create an ISA account for stocks & shares, it has the same capabilities as the other Trading Accounts. However, there are no taxes on interest, dividends, or capital gains. Annual contributions to a Stocks and Shares ISA are capped at £20,000.
  • Self-Invested Contribution Pension Plan (SIPP): For SIPPs, all dividends and capital gains are tax-free, much as a Stocks and Shares ISA. Further, annual contributions are deductible up to a maximum of £40,000. But you have to wait until you're 55 before you can start taking withdrawals. Once withdrawals begin, they are subject to the same tax treatment as a traditional pension.

Don't freak out if it seems like a minefield at first. It shouldn't be too difficult to come up with a shortlist if you make some basic assumptions about how much money you have in your portfolio now (and that you could have in a few years) and how frequently you would wish to purchase shares.

To get you started, here is a list of the best stock trading accounts on our site.

How to Buy HSBC Shares — 2. Prepare

We buy things we don't need with money we don't have to impress people we don't like.

Dave Ramsey (Source)

Having a monthly budget will offer you a clear picture of where your money is going and a plan of action to get you there. Whether your financial objective is to pay off debt, save for retirement, or just avoid your grocery cost from spiralling out of control, a budget can help you get there.

Understanding budgeting as a deliberate expenditure might free up cash for other purposes. Once you've allocated funds for a certain purpose, you may go ahead and spend them without second thoughts. After establishing a reasonable budget and sticking to it, many individuals report finding “extra” cash. Wow, that's incredible.

How much spare money do you have available?

What's the monthly surplus like once bills are paid? You should save up that much money. That sum should be allocated toward retirement savings and an emergency fund if you don't already have one. All remaining money is, however, at your complete discretion.

Verify the cost of HSBC shares

You can finally go shopping now that you have a brokerage account set up. It might be difficult for novice investors to decide which stocks to purchase. You're in luck, as we've compiled a guide on where to look for the top investment opportunities.

When you choose a firm, your broker will give you two different quotes:

  • Bid — refers to the increased offer price at which stock is being purchased.
  • Offer — Stocks may be sold at a lower offer price. You may think of this as the “ask” price.
  • “Bid-offer spread” — refers to the disparity between these two prices. It's a fundamental idea for anybody hoping to become an effective leader in the stock market.

Market makers are businesses that facilitate trades and earn a commission on the difference between the highest and lowest prices offered (the “bid-offer spread” or “bid-ask spread”). When you're ready to acquire shares, they're there to provide them. When you wish to sell your shares, they will also buy them from you. To trade with a market maker, you must go via your broker or investing platform first.

Bid-offer spreads for major firms, those with a valuation of several billion pounds or more, are normally quite modest, amounting to a fraction of one per cent at most.

Bid-offer spreads might be relatively minor for firms with a valuation of £500m or more, but they can reach 10% or more for those with a valuation of £100m or less. Overall, you'll need the share price to increase by more than the sum of the bid-offer spread and any trading fees you pay in order to turn a profit.

How do you want to invest your cash?

Investments may be made in a variety of methods, such as all at once, in lump amounts, or by spreading out smaller payments over a longer period of time (known as “dollar-cost averaging”). Regular investments are those made in a security at a set frequency, usually once a month, regardless of the asset's market price. The risk of loss is reduced, and the long-term per-share expenses could even go down.

If so, do you have any other investments?

Rebalancing may come into it if you do. 

How to Buy HSBC Shares — 3. Calculations

Pain + Reflection = Progress 

Ray Dalio (Source)

First, determine the number of shares you want to invest in… 

If you're satisfied with your broker's offered pricing, you may go to step three, deciding how many HSBC shares to purchase. Brokers often enable you to input a pound value and determine how many shares you can afford. If you do not know how many shares you can afford to purchase, just divide your available money by the share price of the firm you want to acquire.

However, how can you decide how much to put into each company? This is a complex issue, and even experts disagree on how to answer it. Every person has their own unique risk profile and set of financial objectives, therefore there is no one right solution.

To get the full diversity advantages, we at The Motley Fool suggest having a portfolio of 15-25 different companies. As a corollary, it is wise to set aside some money in case an attractive investment opportunity arises.

Accordingly, in our premium services like Share Advisor and Hidden Winners, we often recommend allocating between two and four per cent of your portfolio's value to a new company's shares as a beginning position.

Look into HSBC’s Financial Situation

Putting all your money into one company, especially one as well-known as HSBC, might be exciting, but it's crucial to do your homework beforehand.

A good place to start is with HSBC’s annual report (10-K) and quarterly reports (10-Q), which can be considered required reading for publicly traded companies. Earnings reports and quarterly results are common names used by the fintech media to describe these papers because of the data they include about a stock's financial performance and health.

You may find these documents on HSBC’s investor relations website or in the SEC's database. Financial websites like Morningstar and Forbes, as well as business publications like Forbes, sometimes include expert commentary that may be instructive. After gathering information and expert advice, you may determine whether Apple is a company in which you are willing to invest.

Keep in mind that you always have the option of seeking out expert assistance. Independent analysts like Morningstar provide in-depth analysis of the markets and sectors that brokerage firms represent.

To accurately determine how much of your money you should put toward an HSBC purchase, consider the advice of financial experts.

How to Buy HSBC Shares — 4. Choose Order 

The next stage in learning how to buy and sell HSBC shares is to choose the sort of buy order to make after deciding on the number of shares to purchase.

The moment has come to make advantage of the various order types provided by your broker app in order to either immediately purchase HSBC stock or to wait until the stock price reaches a certain level before purchasing (limit or stop orders).

HSBC stock is traded on the Nasdaq exchange every day of the week between the hours of 9:30 am and 4:00 pm Eastern Standard Time (ET). In contrast, you may take part in pre-hours and after-hours trading on the Nasdaq if you have an online brokerage account.

Nasdaq begins trading at 9:30 a.m. ET, and it continues until the market shuts at 8 p.m. ET. For orders placed outside of your broker's normal trading hours, they will be processed as soon as the markets reopen.

When purchasing shares, you have the same order options as when selling. Order types should be carefully considered in order to maximise stock-buying efficiency. As the vendor, cutting expenses while boosting income should be your first priority.

You can pick from a few options:

  • Best — A broker will quickly place the deal at the most favourable available pricing. While these deals may be completed quickly, the actual cost at which they are made is unclear in advance.
  • Buy-Limit — If the price of the stock drops below a certain threshold, the broker will initiate a purchase order. A trade will be done at the specified price in such a deal. These orders, however, usually incur a higher trading charge and have a time limit in which they must be executed. The deal won't go through if the share price isn't high enough.
  • Sell-Limit — If the share price goes up to a certain threshold, the broker will only make the sell deal. It functions and has the same benefits and drawbacks as a Buy-Limit order.
  • Stop-Loss — If the price of the stock drops below a certain threshold, the broker will carry out a sell order. The goal of this deal is to stop losses from snowballing. However, this may result in significant lost opportunities. Let's say market uncertainty causes a stock's price to drop below the target level. If the stock price rises after the sell order is placed, the order to sell will still be carried out.

★ Further reading: When Stock Markets Close…

How to Buy HSBC Shares — 5. Get HSBC Shares!

Take a look at your shares before submitting it… 

After you have submitted your order, your broker will go over the specifics with you. As a rule, this entails:

  • The stock that was chosen for investment
  • Commissions 
  • Stamp duty 
  • Currency conversion costs (if trading internationally)
  • Extra costs associated with trading (if you’re not doing an At Best transaction)

Examine these specifics to make sure you are not in for any unpleasant surprises and to confirm you are investing in the proper business with the appropriate quantity of shares. You definitely don't want to commit a ‘fat finger mistake' and enter incorrect information.

Next, make your purchase… 

This concludes our tutorial on the stock market. After reviewing and confirming the information, your purchase can be submitted.

Your broker will now provide you with a final quotation, which will be good for just 15 seconds. This At Best transaction will cost you this per-share quotation. The stock market is volatile, thus the actual result may vary significantly from the preview.

When you first start investing, seeing a clock going down might be a little unsettling. But you shouldn't freak out. The transaction will not be processed if the timer expires. Be sure you're okay with the pricing before proceeding.

Simply click the “Accept” button if you're satisfied with the results.

In most cases, the funds will be taken directly from your account. However, this is not always the case when dealing with overseas stock. You may verify that a trade has been made at any time by visiting the part of your broker's site that displays completed and pending trades.

Congratulations, you've made your first investment!

So long. You have gained an understanding of the fundamentals of investing in stocks. And you may start building a sturdy portfolio that generates money in accordance with a plan that you find most suitable.

Maintain accurate and detailed records of your business transactions. Unless you have a tax-efficient account like an ISA or SIPP, you'll need them when completing your yearly tax return or self-assessment.

It is far more common for people to allow ego to stand in the way of learning.

Ray Dalio, Principles (Source)

Track the ROI of HSBC

Every so often, you should take a look at your financial portfolio and see how things are going.

If you want to know how successful HSBC and other firms are, you should first look at their annualised % return. This gives you a hard number to use as a benchmark to see how your investment did in comparison to others. It is also beneficial to revisit the preliminary data you analysed in order to track its development over time.

This information might be compared to the S&P 500 or the Nasdaq Composite Index. A benchmark is a useful tool for comparing the performance of your investment to that of comparable assets or the market as a whole. HSBC stock, like any other investment, has to be monitored often.

The annualised rate of return serves as a good reference point. You can see where HSBC sits by comparing its performance over the last year to that of other, similar companies and investments. You may check HSBC’s financials to make sure the firm is still on track.

You may evaluate HSBC compared to other equities as well as the S&P 500 and the Nasdaq Composite Index. Analyze how HSBC compares to its rivals by reading this data.

By purchasing and selling assets as needed, rebalancing helps bring a portfolio back to a state of balance among its holdings. Portfolio rebalancing is the process of redistributing a portfolio's holdings among its securities and asset classes in response to a change in investment objective or risk tolerance.

When Is It Time to Rebalance?

Several considerations, including transaction costs, personal preferences, and tax ramifications, influence how frequently a portfolio should be rebalanced (for example, the kind of account transactions are coming from and if capital gains come into effect at what rate).

The age of the individual is also taken into account. Rebalancing your portfolio may not be a high priority if you are under the age of 40, but it is crucial if you are nearing retirement and want to maximise your savings. You may want to wait longer than a year before performing your evaluation if the worth of any of your assets hasn't improved in the last year.

Furthermore, it may be important to reassess an investment portfolio if there has been a change in personal circumstances. Your own investment choices may differ, but you may use the following guidelines as a framework.

Keep a careful eye on the overall cost of your portfolio as well as the cost of individual securities once you and your partner have determined a superb asset allocation plan and made acquisitions across all asset classes in line with that strategy (such as HSBC shares). You can gauge your portfolio's performance in relation to the market by keeping track of this data over time.

Buying HSBC via ETFs and Index Funds 

The London Stock Exchange (LSE) is the biggest stock exchange in the United Kingdom and the eighth largest in the world by market capitalization. There is a total market valuation of almost £3 trillion for all listed equities.

Any British citizen who has never invested in stocks or exchange-traded funds should probably begin with the LSE.

Shares of stock, commodities, and bonds with a set interest rate are only some of the financial products that may be exchanged on the London Stock Exchange.

Shares of the LSE are not publicly traded, hence direct investment in the exchange is impossible (although you can buy shares in the company which operates the LSE). Instead, you may put your money into exchange-traded funds (ETFs), index funds, or the individual stocks of specific firms traded on the exchange.

Buying HSBC Using ETFs… 

Exchange-traded funds are pools of capital that invest in a diversified portfolio of assets, such as stocks, bonds, or commodities. Every exchange-traded fund is designed to mirror the performance of a certain stock market index, economic sector, commodity, or investing approach.

ETF units are traded on the stock market just like any other firm share. Unit values fluctuate regularly during the trading day, albeit often less so than the prices of individual stocks. So, they are a method of distributing danger.

Investments in ETFs are less likely to experience large losses or profits in the near term compared to those in individual shares. Exchange-traded funds ETFs are best used by those with a long-term investment horizon.

Many ETFs registered on the LSE will passively follow an index fund (see below), but there are also actively managed ETFs that invest in LSE-listed firms without precisely mirroring an index.

Some LSE ETFs that don't follow the major indexes nevertheless put money into stocks, however, the vast majority invest in fixed-income items like government bonds.

Buying HSBC Using the LSE Index… 

Index funds are a specific kind of ETF that seeks to replicate the performance of a market index by investing in the same number and value of shares in the index as the index itself. Among the several LSE market indexes, the FTSE 100 and FTSE 250 are the most well-known (e.g. FTSE 350, FTSE All-Share).

Index ETFs are passive funds since they automatically follow an index, in contrast to actively managed ETFs. Compared to actively managed ETFs, passive funds often have lower management costs. 

You’ll want to track the London Stock Exchange (LSE). But here are examples of other typical index funds:

Fast Sum Up

How to Buy HSBC Shares

Buying HSBC shares in the UK has never been easier.

  • 🌐 Simply visit eToro.com and choose “Join” to create an account. Enter your details here to register for an account. Your capital is at risk.
  • 📰 If you want to buy stocks with your eToro account, you need first verify your identity and your billing address.
  • 💳 Third, add a minimum of $50 to your trading account.
  • 🛒 Last but not least, this is the opportune moment to buy. If you do a search for “HSBC” and then click the “Trade” option, you may purchase Apple shares.

That’s it.

Related Guides:

FAQs

HSBC Means What Exactly?

Is HSBC British or Chinese?

HSBC and SABB: What's the Difference?

When is the Best Time to Buy or Sell HSBC Stock?

What Would Buying HSBC Shares Be in ROI?

Is HSBC a Solid Dividend Stock?

Is HSBC a Public or Private Institution?

Was HSBC Ever a Victim of a Data Breach?

Do HSBC Bank Transfers Cost Anything?

Related Articles

What Is a Visa Credit Card?
Are you looking for an extra cash boost but are not sure where to start? A Visa...
Should you Rent or Buy a Home?
Private rental prices have shot up over the last year but following several interest...
How Does Credit Scoring Work?
Your credit score is a record of how you manage your money and every time you apply...
Can You Transfer Money From Credit Card to Bank Account?
You may consider making a money transfer if you have a credit card and need cash...

Mentioned Banks

About Havin Bank Havin Bank, formerly known as Havana International Bank, or HIB, was founded in the United Kingdom in 1972. It received its banking authorisation the following...
Learn More
About HSBC Bank HSBC is a British banking and financial services company. It is the largest bank in Europe and the seventh largest bank in the world. The bank originated in Hong Kong...
Learn More
About Lloyds Bank Lloyds Bank is a British retail and commercial bank. One of the ‘Big Four’ clearing banks, it was founded in Birmingham in 1765. It is the largest retail bank...
Learn More