Summary: Despite the recent blackouts, Reddit (NYSE: RDDT) keeps defying all odds as one of the most visited sites of all time. And with its transition to a public company, investors now have the opportunity to directly invest in Reddit’s success with online brokers, such as eToro.
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What is Reddit?
Reddit was founded and launched in 2005 by two roommates, Steve Huffman and Alexis Ohanian, and since its humble origins, it has become one of the most visited and culturally relevant online communities. The platform now boasts over 52 million users and 2,000 employees engaged in daily discussions on countless subforums called subreddits, all dedicated to a specific topic and micromanaged by a team of moderators.
On March 21, 2024, Reddit made its debut on the NYSE, trading under the ticker symbol RDDT.
Reddit IPO
Reddit’s highly anticipated IPO took place on March 21, 2024, with shares debuting on the NYSE under the ticker RDDT. The company’s initial offering was priced at the upper limit of the proposed $31 to $34 per share, achieving a valuation of $6.4 billion.
How to buy Reddit stock?
Once Reddit stock becomes available to the retail investing public, you can purchase it through any regular brokerage account.
Reddit valuation
The IPO price valued Reddit at around $6.4 billion.
How to buy Reddit stock: Step-by-step process
To invest in a Reddit, simply take the following steps:
Step 1: Set up a brokerage account
To invest in Reddit, you’ll need a reliable broker that will give you access toReddit stock. Before settling for a broker, consider its:
- Reputation: A stamp of approval by bodies such Financial Conduct Authority (FCA) or Financial Industry Regulatory Authority (FINRA), as well as a good number of positive user reviews, are mandatory;
- Fees and commissions: Look for a broker that will not charge a lot for commissions, account maintenance, transfers, etc;
- Range of offerings: If you plan on investing more often and employing various trading strategies, make sure your broker offers mutual funds, ETFs, options, and other financial instruments;
- Withdrawal and deposit options: You’ll have to fund your account and withdraw money from it, so be sure the broker supports your payment method of choice;
- Account minimums: Some brokers may impose account minimums before you can register, so be sure you can afford that.
Where to buy stocks
Our recommended broker is eToro, a well-regulated platform with over 2 million users in more than 200 countries, licenses issued by bodies such as The U.S. Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC), as well as low commission rates. Moreover, it offers features such as:
- Commission-free stock trading;
- Access to over 2,000 stocks from 17 different exchanges;
- Charting tools;
- The option to purchase fractional shares;
- A user-friendly platform that simplifies the trading experience.
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.
If you want to avoid the volatility that comes with investing in a fresh IPO, consider these social media stocks instead:
- Meta Platforms (META): With Facebook and Instagram under its wing, investing in Meta is still a no-brainer;
- Snap Inc. (SNAP): With 406 million daily users in 2023, Snapchat is one of the reigning messaging apps worldwide;
- Pinterest (PINS): Pinterest is one of the largest image-sharing and social media platforms, with some 463 million global monthly users as of 2023.
Step 2: Deposit funds into your account
Once you have set up an account, you can add some funds. eToro offers a good number of payment methods for funding your account. You can link it to your bank account, scan a check, transfer funds from Wise, etc.
Step 3: Place a trade
Finally, once you have got funds in your account, you can start buying stocks. This is done by:
- Log in on the website;
- Look up Reddit by its ticker symbol RDDT in the search bar;
- Click on the Trade button on the dashboard;
- Specify the number of shares or monetary value you want to invest;
- Submit the trade.
Bonus step: Monitor and manage your investment
You’ve got the stock in your portfolio, but that does not mean the investing process is over. For your investment to be fruitful and for you to sell the stock when the time is ripe, you’ll have to monitor the performance of the company you invested in and track the changes in the industry as a whole. Staying in the loop will help you make better-informed decisions in the future and ensure you can adjust your investment strategy should the need for it arise.
To calculate the average stock price of your investments, you can use Finbold’s stock average calculator.
In an unusual strategy for its IPO, Reddit offered its most dedicated users and moderators the chance to purchase its stock, a privilege usually reserved for institutional or affluent investors. What’s more, these shares won’t be subject to a lockup period, removing the usual post-IPO selling restrictions and potentially adding to price volatility.
As highlighted by Reddit’s S-1 form:
Given the broad awareness and brand recognition of Reddit, including as a result of the popularity of r/ wallstreetbets among retail investors, and the direct access by retail investors to broadly available trading platforms, the market price and trading volume of our Class A common stock could experience extreme volatility for reasons unrelated to our underlying business or macroeconomic or industry fundamentals.
Pros and cons of investing in Reddit
Pros
- Engaged user base: High community engagement and unique platform structure;
- Revenue growth: 21% increase in 2023, indicating potential for future profitability;
- AI and advertising potential: Innovative use of AI and targeted advertising strategies;
- User IPO participation: Empowering community members with early investment opportunities.
Cons
- Financial sustainability: Ongoing losses and negative cash flows raise long-term viability concerns;
- Market volatility: Potential stock price fluctuations influenced by subreddit activities;
- User backlash: Efforts to monetize the platform, such as the new API charging model, have led to backlash from the user community, which could impact Reddit’s reputation and user engagement;
- Regulatory and legal challenges: The FTC’s inquiry into Reddit’s Google deal and potential legal challenges regarding content licensing and moderation practices could result in significant costs and operational changes.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
FAQs about how to buy Reddit stock
Is Reddit publicly traded?
Reddit is a publicly traded company. It trades on the NYSE under the ticker RDDT.
Does Reddit have stock?
Reddit’s stock is listed on the NYSE under the symbol RDDT.
How to buy Reddit stock?
As soon as Reddit stock becomes available to retail investors, you can buy it from your regular stock broker.
What is the projected Reddit stock price?
Reddit’s initial offering was priced at $34 per share.
For when is the Reddit stock IPO date set?
Reddit IPO was on the 21. March, 2024.
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.
