How to Buy Snowflake Stock [2024] | Invest in SNOW

As we stand on the precipice of a global data avalanche, the importance of data management has become undeniable, thrusting the potential role of cloud data platforms like Snowflake into the spotlight. In this guide, we give you an overview of the warehouser, explain how to buy Snowflake stock and present our suggestions for the most reliable brokers to use. 

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What is Snowflake?

Snowflake IPO

Snowflake went public via an initial public offering (IPO) on September 16, 2020, raising $3.4 billion, one of the largest software IPOs as well as the largest to double on its first day of trading. It is listed on the New York Stock Exchange (NYSE) under the ticker SNOW and is a constituent of the Russell 1000 Index.

Where to buy Snowflake stock?

The easiest way to buy Snowflake stock is to register with an online broker – such as eToro – that offers access to the New York Stock Exchange and SNOW. 

Remember to conduct your due diligence before you engage in stock trading, including understanding the company’s business model, financial stability, profitability, overall market trends, and the risks associated with investing in the stock market.

With that being said, let’s delve into the step-by-step process.

How to buy Snowflake stock? Step-by-step process

As a publicly-traded company, Snowflake stock can be bought through a regular retail broker or investment platform. 

In the following segment, we present a comprehensive step-by-step guide to buying Snowflake stock and provide suggestions for particular platforms you may want to consider.

Step 1: Choose a broker

When assessing brokers, consider these factors:

• Understand your needs: First, identify your investment goals and strategies. Are you a day trader, swing trader, or long-term investor? Different brokers cater to different types of investors;
• Cost: Trading costs can eat into your returns, so it’s essential to understand a broker’s fee structure, including commission fees, account maintenance fees, and any other charges. Luckily, you can expect commission-free stock and exchange-traded fund (ETF) trading from most online brokers; 
• Range of offerings: Verify that the broker provides access to the particular asset classes that interest you, such as stocks, bonds, commodities, cryptocurrencies, or forex, as well as more complex derivative financial instruments like options and futures;
• Platform usability: The trading platform should be user-friendly and match your proficiency level;
• Regulation and security: Ensure the broker is regulated by the Securities and Exchange Commission (SEC) and that they have implemented appropriate measures to protect your data and funds;
• Account minimums: Some brokers require a minimum amount to open an account. Make sure this aligns with your budget;
• Fractional stock trading: Fractional shares allow investors to purchase stocks or ETFs by the dollar amount. This is particularly useful for investors with limited capital or those intending to implement a dollar-cost averaging (DCA) strategy. 

To securely invest in Snowflake and buy SNOW stock, consider these brokers:

1. eToro

• Commission-free stock trading; 
• 2,000+ stocks from 17 exchanges;
• Fractional shares available;
• User-friendly platform.

Highly Rated Stock Trading & Investing Platform

• Invest in 2,800+ stocks and other assets including 70+ cryptocurrencies and commodities.

• 0% commission on buying stocks - buy in bulk or just a fraction from as little as $10. Other fees apply. For more information, visit etoro.com/trading/fees.

• Copy top-performing traders in real time, automatically.

• eToro USA is registered with FINRA for securities trading.

30+ million Users

Get Started

eToro is a multi-asset investment platform. The value of your investments may go up or down. Your capital is at risk. eToro USA LLC does not offer CFDs, only real Crypto assets available. Don’t invest unless you’re prepared to lose all the money you invest.

2. Interactive Brokers (IBKR)

• Commission-free stock trading;
• Global stock-trading on 90+ market centres;
• Fractional shares available;
• Extra income on fully paid shares;
• Lowest financing rates for margin accounts in the industry;
• No account minimum. 

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Step 2: Fund your account

After choosing a broker and registering, the next step is funding your account. You’ll usually have several options for making deposits, such as connecting a bank account directly, utilizing a debit, credit, or prepaid card, or choosing a third-party payment provider like PayPal (PYPL).

Note that it can sometimes take up to three days for the money to reach your account.

Step 3: Research the company

You can start your research by exploring Snowflake’s official website, specifically the “Investor Relations” section. Here you’ll find access to numerous resources such as quarterly results, SEC filings, shareholder presentations, latest company updates, as well as Environmental, Social, and Governance (ESG) strategies. 

These resources will offer invaluable insights into Snowflake’s financial well-being, future strategies, and potential hurdles that the company or industry may encounter, including changes in data protection laws or intensifying competition in the data storage space.

Step 4: Decide how much you want to invest

Before deciding on the amount, ask yourself these questions: 

• Can I afford to lose this money without affecting my standard of living?
• Have I taken care of my daily living expenses, emergency savings, or financial commitments such as debt repayments?

Of course, your risk tolerance will also significantly shape this decision, as the amount you’re willing to invest can vary depending on your comfort level with potential losses.

Step 5: Place your order and buy SNOW shares

Once you’ve determined how much you want to invest, you’re ready to place your order. You can do this by logging into your brokerage account, searching for the ticker SNOW, and clicking on ‘Open Trade’ or ‘Buy’. 

You’ll have two execution options:

• Market Order: An order filled immediately at the prevailing market rate at the time (or at the opening of the market);
• Limit order: This order lets you set a predetermined price at which your trade needs to be executed. Limit orders are triggered only when the price reaches a certain predetermined level, transforming into a market order as soon as the market price aligns with the price specified in your order.

Consider investing in SNOW with index funds: Diversify your assets to ensure your portfolio maintains a healthy balance of risk and reward. One of the easiest ways to achieve this is by investing in ETFs: 

• Since Snowflake is a constituent of the Russell 1000 Index, it’s included in any ETF following the index. For example, as of December 2023, Snowflake forms 0.14% of the iShares Russell 1000 ETF (NYSE: IWB);
• Alternatively, if you want more concentrated exposure to cloud technology, you may want to consider Fidelity Cloud Computing ETF (CBOE: FCLD), where SNOW makes up 3.28%, or WisdomTree Cloud Computing Fund (NASDAQ: WCLD), where it forms 1.40%. 

Step 6: Monitor your investment

Review your investment in Snowflake regularly to ensure you’re on track to reach your financial goals but avoid making impulsive decisions based on short-term market movements.

Bonus step: Track the performance of market competitors

Keeping an eye on the performance of other players in the data warehouse space, such as Amazon Redshift (NASDAQ: AMZN), Google BigQuery (NASDAQ: GOOGL/GOOG), Microsoft SQL Server (NASDAQ: MSFT), and IBM Db2 Warehouse (NASDAQ: IBM), can provide crucial comparative insights. 

Snowflake stock price 

Should I buy Snowflake stock?

Whether you should buy Snowflake stock depends on your risk tolerance and investment goals, as well as the current state of your investment portfolio.

While thoroughly analyzing the company’s fundamentals is crucial, you may also want to leverage technical analysis to assess price trends and patterns on stock charts to spot potential trading possibilities.

The gauge displayed here represents the real-time technical analysis overview of Snowflake stock for your specified timeframe (in this case, one day). It can simplify trading decisions (subject to your proficiency in technical analysis) by demonstrating the real-time recommendations of popular technical indicators such as moving averages and oscillators.  

Disclaimer: TradingView does not recommend trading financial instruments based exclusively on the advice of the Technical Rating indicator. These recommendations cannot predict future movements and are meant as assistance for spotting potentially favorable buy/sell conditions if this is consistent with their strategy.

Common mistakes to avoid when investing in the stock market

Some of the most common mistakes to avoid when investing in the stock market include: 

• Lack of research: Don’t invest in a company without thoroughly researching its financial health, management, and market position;
• Chasing hot tips: Be wary of investing based on rumors or “hot tips” without doing your own due diligence;
• Emotional decision-making: Avoid making investment decisions based on fear or greed; instead, rely on sound financial analysis and strategy;
• Putting all your eggs in one basket: Don’t put all your money into one stock or sector. Diversify your portfolio to spread risk;
• Impatience: Don’t expect quick returns. Investing is a long-term game, and it often takes time for investments to pay off;
• Neglecting to monitor your portfolio: It’s essential to review your portfolio regularly and make adjustments as necessary;
• Overcomplicating strategy: Don’t unnecessarily complicate your investment strategy with exotic financial products or complicated trading techniques, particularly if you’re new to stock trading.

Pros and cons of buying Snowflake stock

Investing in Snowflake, like any company, comes with its own set of advantages and disadvantages. Here are a few to consider:

Pros

• Growing demand for cloud computing services: As businesses continue to digitize their operations and data, the demand for cloud-based services is expected to grow and may benefit Snowflake, which operates in the space;
• Market position: Snowflake is highly recognized in its industry. In fact, before going public in 2020, it secured the top spot on Forbes Cloud 100 in 2019, which ranks the world’s leading 100 private cloud firms;
• Strong partnerships: By partnering with leading cloud providers like AWS, Google Cloud, and Azure, Snowflake can enhance its range of services, which not only delivers a more comprehensive solution to its customers but also expands its opportunities for growth.

Cons

• Intense competition: Snowflake is not the undisputed leader in its industry and faces considerable competition. If rival options become more attractive, Snowflake’s future market share prospects may be jeopardized;
• Sensitivity to macroeconomic conditions: Given that Snowflake operates on a consumption-based model rather than a subscription-based one, bearish investors have expressed concern that a potential US recession could dampen demand;
• Frenemy relationship: Approximately 85% of the company’s revenues come from data analytics tasks implemented on Amazon Web Services, which is also Snowflake’s biggest competitor through AWS Redshift. This creates a potentially risky relationship that may result in complications down the line;
• No dividends: Snowflake does not pay dividends (as of December 2023). 

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk. 

In conclusion

Snowflake finds itself at the heart of the rapidly expanding cloud data warehousing sector; its unique pricing and business strategy, impressive customer base, and robust partnerships highlight its solid footing for potential growth. That said, investors should consider Snowflake’s potential for continued growth alongside the risks inherent in its high valuation and the competitive market it operates in.

Ultimately, regardless of Snowflake’s promising prospects, the key to successful investing lies in a balanced and diversified portfolio. As always, perform due diligence or consult a financial advisor before committing to any stock. 

FAQs about buying Snowflake shares

Highly Rated Stock Trading & Investing Platform

• Invest in 2,800+ stocks and other assets including 70+ cryptocurrencies and commodities.

• 0% commission on buying stocks - buy in bulk or just a fraction from as little as $10. Other fees apply. For more information, visit etoro.com/trading/fees.

• Copy top-performing traders in real time, automatically.

• eToro USA is registered with FINRA for securities trading.

30+ million Users

Get Started

eToro is a multi-asset investment platform. The value of your investments may go up or down. Your capital is at risk. eToro USA LLC does not offer CFDs, only real Crypto assets available. Don’t invest unless you’re prepared to lose all the money you invest.