How to buy and short Ocado shares
Ocado is an online supermarket and technology-licensing company. Here, we tell you how to buy and short Ocado shares, and we show you how to analyse the Ocado share price.
How to buy Ocado shares
‘Investing’ in Ocado shares means that you would be taking direct ownership of them. ‘Buying’ Ocado shares means that you’ll be trading on the Ocado share price with financial derivatives like CFDs, without taking ownership of the underlying shares. You can speculate on the Ocado share price rising by going long, or falling by going short. You’ll also be able to open a position with leverage, which will grant you full market exposure for an initial deposit. With us, you cannot invest in Ocado shares, you can only trade them.
Trading Ocado shares
- Create or log in to your trading account and go to our trading platform
- Search for ‘Ocado’
- Choose your position size
- Open your position and monitor your trade
Trading Ocado shares
- Create or log in to your trading account and go to our trading platform
- Search for ‘Ocado’
- Choose your position size
- Open your position and monitor your trade
You can speculate on the Ocado share price with CFDs. Since these are financial derivatives, you’ll be able to:
- Get full exposure with a 20%-25% deposit on almost all of our tier-one shares1
- Hedge your positions with CFDs and offset losses against profits for tax purposes2
How to short Ocado shares
‘Selling’ Ocado shares means that you would be reducing your investment position. ‘Shorting’ Ocado shares means that you’ll be profiting from a decrease in their value. You can go short with financial derivatives like CFDs because these products enable you to take a position without owning the underlying shares.
Shorting Ocado shares
- Create or log in to your trading account and go to our trading platform
- Search for ‘Ocado’
- Choose your position size
- Choose ‘sell’ in the deal ticket to go short and speculate on the price falling
- Confirm and monitor your short position
Shorting Ocado shares
- Create or log in to your trading account and go to our trading platform
- Search for ‘Ocado’
- Choose your position size
- Choose ‘sell’ in the deal ticket to go short and speculate on the price falling
- Confirm and monitor your short position
Ocado’s live market prices
Ocado shares: the basics
Ocado is listed on the London Stock Exchange (LSE) under the OCDO ticker. The company is a constituent of the FTSE 100, and its chief executive officer (CEO) – Tim Steiner – is the highest paid FTSE 100 CEO, receiving over £58 million in financial year 2019.3
The company has performed well in 2020 as more people have turned to online grocery delivery instead of visiting supermarkets themselves during the coronavirus pandemic. You can see a screengrab from our trading platform below, showing Ocado’s share price movements from 1 January 2020 to 1 July 2020. As it shows, the Ocado share price has gained 59.27% during this timeframe.
For the second half (H2) of 2020, Ocado is looking to expand its technology business. The company is ending a 20-year relationship with Waitrose, and it will sell half of its current grocery business to Marks & Spencer in a deal that will take effect in September 2020.
It’s not unfair to say that the company’s technology business has been overshadowed by its wider-known reputation as an online supermarket. But, Ocado licenses its technology – including its automated warehouse space – out to some of its largest competitors around the globe including Morrisons, Groupe Casino, Coles and Kroger.
The shift towards technology that is expected in the coming years will likely impact the company’s share price. As a result, you should keep track of the Ocado share price up to and after this shift to capitalise on any market volatility.
What is Ocado’s business model?
Ocado’s business model is based on the delivery of groceries to customers’ front doors. Despite being considered by many to be a ‘supermarket’, Ocado has no physical shops in which customers can buy goods.
Instead, the company operates out of a number of warehouses where they store and sort groceries for home delivery. The company’s stated aim is to ‘change the way the world shops [by] continually creating a shopping experience that is easier and more efficient at every stage’ of the company’s development.
Looking ahead to the next steps of the Ocado business model, the company has sold half of its grocery business to Marks and Spencer in a deal that is set to take effect in September 2020.
After this, Ocado will attempt to shift more towards being a technology company – leasing out warehouse space and assisting other supermarkets with their online services, storage and distribution.
This means that there is dramatic space for growth in the Ocado business model, and time will tell just how successful the shift toward technology and away from groceries is.
Ocado key personnel: who manages the company?
There are 12 people on the board of directors at Ocado:
| Lord Rose | Chairman |
| Tim Steiner | CEO |
| Luke Jensen | CEO Ocado Solutions |
| Duncan Tatton-Brown | Chief financial officer (CFO) |
| Neill Abrams | Group general counsel and company secretary |
| Mark Richardson | Chief operations officer (COO) |
| Andrew Harrison | Senior independent director |
| Jõrn Rausing | Non-executive director |
| Emma Lloyd | Non-executive director |
| Julie Southern | Non-executive director |
| John Martin | Non-executive director |
| Claudia Arnery | Non-executive director |
How to analyse Ocado’s share price
You’ll need to use both fundamental and technical analysis to analyse the Ocado share price.
Fundamental analysis is focused on the macroeconomic factors that could cause a company’s share price to rise or fall, such as company earnings, senior leadership changes or product changes.
Technical analysis is focused on price chart movements, using indicators and price action to attempt to determine what a share price might do in the future.
Popular fundamental metrics include a company’s price-to-earnings ratio (P/E ratio), its return on equity (ROE), and the relative dividend yield. Popular technical indicators include the parabolic SAR, moving averages, and the relative strength index.
Buying Ocado shares summed up
- Buying Ocado shares means that you’ll be speculating on the share price with derivatives like CFDs
- Shorting Ocado shares means that you’re speculating on the price of Ocado shares falling
- To buy or short Ocado shares, you’ll need to open a trading account with us
1 Deposits on leveraged trades are 20-25% for 99.14% of tier-one shares (correct as of 1 June 2020). For more information, view our share trading margin rates.
2 Tax laws are subject to change and depend on individual circumstances. Tax law may differ in a jurisdiction other than the UK.
3 Pay Check, 2020
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Explore the markets with our free course
Discover the range of markets you can trade on - and learn how they work - with IG Academy's online course.
Ready to trade shares?
Put the lessons in this article to use in a live account. Upgrading is quick and simple.
- Trade over 13,000 popular global stocks
- Protect your capital with risk management tools
- Trade on 70 key US stocks out-of-hours, so you can react to news
Share IG and get rewarded
Share us, be rewarded
Earn up to $51,000 for introducing your friends to us.
Terms and conditions apply.
