How To Buy Nike (NKE) Stock

Perhaps best known for its iconic sneakers, Nike is a manufacturing powerhouse that produces almost every kind of athletic equipment and apparel you can dream of. That’s led to impressive financials: For fiscal year 2021, Nike’s revenues increased 19% to a whopping $44.5 billion.

Shareholders have also been on the receiving end of its financial success. In the 20-year period spanning January 2001 and January 2021, Nike’s stock price rose about 2,000%—from $6.77 to over $140 per share. Even short-term investors have gotten to hitch a ride on the swoosh’s ascent, though. From the beginning of January 2019 to January 2022, Nike’s price has increased by over 80%.

If all of that inspires you to apply Nike’s “just do it” slogan to your investing, here’s how to buy Nike stock.

How to Buy Nike (NKE) Stock

1. Select a Brokerage

To buy Nike stock, you need a brokerage account. If you don’t already have one, you’ll have to open one—ideally at a firm with no trading fees and low investment minimums. To expedite your search process, check out our list of the best online brokers and best investment apps.

You’ll also want to consider your financial goals. If you’re aiming to invest for retirement, choose an individual retirement account (IRA). These types of accounts can provide upfront tax deductions or tax-free withdrawals in retirement. IRAs come with a big catch: You typically cannot withdraw money without paying penalties before you’re 59 ½ years old.

If you’re investing for more near-term goals or want flexibility when it comes to withdrawing your proceeds, you should probably opt for a taxable account. You won’t receive the tax benefits of an IRA, but can take out profits whenever you wish. You can also engage in tax-loss harvesting, which allows you to sell investments at a loss to offset other taxable gains you make in a year.

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2. Determine How Much You Can Invest

When deciding how much to invest in Nike, ask yourself these four questions:

  • What’s your budget? You don’t want to invest money you’ll need for your regular expenses or emergency fund. You’ll also want to make sure you’re setting aside at least something for retirement before you start into other types of investing. Once you’ve got those accounted for, any extra can go into any other investments that you choose, including Nike.
  • What’s NKE’s current price? The price of a single share of Nike can be even higher than a pair of Jordans. If you don’t have that much to sink into NKE all at once, you may want to seek out brokerages that allow for fractional share investing so you can buy portions of shares, instead of pricey full ones outright. This feature is common on investing apps but relatively rare among traditional brokerages. Mainstays like Charles Schwab and Fidelity, as well as startups like Stash and Robinhood, let you trade fractional shares.
  • What’s your investing strategy? There are two main ways people invest: with large one-off investments and with regular, smaller investments. The latter method, called dollar-cost averaging, can lower the average price you pay per share long term. By buying a fixed dollar amount of an investment, no matter how the market is performing, you avoid buying a lot when a stock’s price is extremely high. Because it has a low financial barrier to entry, it also helps you get your money in the market as soon as possible, instead of forcing you to wait until you build up a large lump sum.
  • How will Nike fit into your overall portfolio? “I would consider NKE to be a ‘core holding,’” says Nathaniel Hoskin, a certified financial planner (CFP) and founder of Hoskin Capital. “A portfolio’s core holdings are very large capitalization, well-known companies.” This means they’ll likely experience fewer wild price swings and are less risky than smaller, less established companies. You’ll still want a diversified mix of companies of many different types to help your money grow while minimizing your risk over time, though. That means NKE shouldn’t be the beginning and end of your portfolio.
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4. Research NKE’s Financials

Before you buy any stock, you should do your own research on its financials and historical performance. This way you’re fully aware of its business operations, plans for growth and financial stability.

As a publicly traded company, the U.S. Securities and Exchange Commission (SEC) requires Nike to file annual and quarterly statements. You can view these on Nike’s investor relations page or SEC.gov. You may also complement these reports with analyst reports and insights that you find using your brokerage’s research resources.

An important note: As you research Nike, you may discover it has two share classes, Class A and B. You only need to worry about Class B as A doesn’t trade on the public market and is held primarily by Nike’s founding family.

The main distinguishing factor between Class A and B is that Class A shares can be converted at a one-to-one ratio into Class B shares (the reverse is not true) and Class A shares are entitled to elect nine of the 12 members of Nike’s board. Class B shares elect the other three, meaning Class A shareholders effectively control the company.

5. Place an Order for NKE Stock

When you’re ready to buy Nike Stock, you’ll simply need to log into your brokerage account, enter Nike’s ticker symbol (NKE) and input the amount of shares (or dollar value of shares) you want.

Depending on your preference and brokerage interface, you may have to choose between order types. Market orders are completed right away at the current trading price and are generally the default if no alternative is selected. Limit orders, meanwhile, hold off on executing your purchase until a certain price is met. This can be a helpful feature for people who expect a share to fall in value soon.

Because it trades on the New York Stock Exchange (NYSE), you can buy and sell Nike shares Monday through Friday from 9:30 a.m. until 4:00 p.m. ET, though your brokerage may offer extended hours before or after the market closes.

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6. Sell Your Nike Stock

Even the longest of long-term investors eventually will need to sell their investments. When you’ve decided to part ways with NKE, the process is as simple as your original purchase order.

Log into your investment platform, enter Nike’s ticker symbol and the dollar or share amount you want to sell. You may also pick a particular order type if you prefer not to sell at the current market price.

If you’ll be receiving substantial profits, it may be worthwhile to meet with a tax professional to evaluate the best way to minimize the amount of capital gains taxes you may owe.

How To Invest in Nike With Mutual Funds and ETFs

Nike is a major company with decades of proven revenue and stock growth. But investing in any one company can be risky.

To decrease that risk, experts recommend you invest in many companies—or avoid picking and choosing yourself altogether and buy shares of index funds or exchange-traded funds (ETFs). Because they hold hundreds of companies’ stocks, you’re basically buying shares of an already-diversified investment portfolio.

“My advice is to start with the index,” says Hoskin. “This way, you don’t feel like you need to immediately fill your portfolio with lots of stocks and you don’t start with a portfolio of only one or two stocks. Once your portfolio is invested in an index fund, you can begin the process of slowly researching a couple of holdings.”

Many leading index funds and ETFs provide exposure to Nike. S&P 500 funds, for instance, invest about 0.5% of their holdings in NKE.

But if you want to invest in an index fund with even heavier Nike representation, you might consider a consumer discretionary sector index fund, like the Fidelity Select Consumer Discretionary Portfolio (FSCPX) or Consumer Discretionary Select Sector SPDR® Fund (XLY), where NKE is a top holding.