How to buy, sell and short Shell shares

How to buy or invest in Shell shares

There are two ways you can buy Shell shares. The first is to invest in shares in the traditional sense. This involves share dealing and gives you direct ownership of the shares, making you a company shareholder. You’ll be eligible to receive dividends if paid and have voting rights in company decisions.

Alternatively, you can ‘buy’ shares by speculating on movements in the share price with financial derivatives like spread bets and CFDs. This enables you to go ‘long’ when the share price is rising – or ‘short’ when it falls – without actually owning the asset. Opening a position in this way makes use of leverage, which gives you full market exposure for an initial deposit.

Follow the steps below to invest in or buy Shell shares:

Not sure about which is best for you? Learn more about the differences between trading and investing.

How much would it cost to invest in Shell?

Take advantage of IG’s best commission rates, available to active clients who have placed three or more trades in the previous calendar month.

If you’d prefer to trade on the price of Shell shares instead, you can use derivatives. With spread bets and CFDs you’ll be able to:

• Get full exposure with a 20%-25% deposit on almost all of our tier-one shares¹
• Spread bet without paying tax on any profits²
• Hedge your positions with CFDs and offset losses against profits for tax purposes²

How to sell or short Shell shares

If you decide to sell your Shell shares, you’ll be closing your position by either taking a profit or cutting a loss. You can transfer your electronic shares to us for free and sell them via our share dealing service.³

You can also short Shell’s shares with spread bets and CFDs if you think the share price is going to drop.

Follow these steps to sell or short Shell shares:

Shell’s live market prices

Shell shares: the basics

Royal Dutch Shell has a primary listing on the London Stock Exchange (LSE) and is a member of the FTSE 100 index. It has secondary listings on Euronext Amsterdam and the New York Stock Exchange (NYSE).

The company has two classes of shares listed on the LSE:

• ‘A’ shares (RDSA) – these shares have a Dutch source for tax purposes, meaning cash dividends are paid out in euros and are subject to a Dutch withholding tax of 15%
• ‘B’ shares (RDSB) – this class of shares has a UK source. Here, cash dividends are paid out in pounds and aren’t subject to any withholding tax

Shell’s share price is closely linked to the price of oil, making it very susceptible to the market forces influencing supply and demand. However, the company is able to mitigate oil price volatility with its oil trading unit.

What is Shell’s business model?

Royal Dutch Shell is a global group of energy and petrochemical companies founded more than a century ago. Headquartered in the Netherlands, Shell operates in more than 70 countries and employs over 80,000 people.

Shell’s activities are split into four segments: integrated gas, upstream, downstream and new energies. The company also has a dedicated ‘projects and technology’ division to provide technical assistance and functional leadership to the various business units.

Shell extracts crude oil (which is refined and sold across a range of products) and natural gas, and manufactures and markets petrochemicals. In recent years the company has started to transform its business model by investing in more eco-friendly technologies, like biofuels and renewable energy, with the aim of becoming a net-zero emissions energy business by 2050.

Shell key personnel: who manages the company?

There are 12 people on the Shell board of directors:

How to analyse Shell’s share price

To analyse Shell’s share price properly, you need to consider both fundamental and technical analysis.

Fundamental analysis is focused on external events and influences, financial statements and industry trends. This is done to determine the factors that could cause a company’s share price to rise or fall, as well as the profitability of a company.

Fundamental metrics you can use to determine the value of Shell include price-to-earnings ratio (P/E ratio), return on equity (ROE) and earnings per share (EPS).

• EPS measures Shell’s profitability. To calculate earnings per share, divide Shell’s profit by the number of outstanding shares
• P/E shows how much you’d have to spend on Shell shares to make £1 in profit. To calculate the price-to-earnings ratio, divide Shell’s share price by its EPS
• ROE compares Shell’s income from its assets against its shareholder equity. To calculate return on equity, you’d divide Shell’s net income by stakeholder equity

Technical analysis is focused on price chart movements, using indicators and price action to detect patterns and trends. This could help determine what a share price might do in the future. Popular technical indicators include the parabolic stop and reverse (SAR), moving averages and relative strength index (RSI).

Shell’s financial information for fundamental analysis is available on the company’s website and in its annual report. The tools needed for technical analysis are available on our trading platforms, and can be overlaid onto a price chart for you to view.

Buying Shell shares summed up

• There are two ways you can buy Shell shares. The first is to invest in shares in the traditional sense, while the other is to ‘buy’ shares using derivatives
• You can buy, sell and short shares in Shell with IG. The processes are simple and cost-effective
• Shares in Shell can be analysed using fundamental and technical analysis techniques
• Fundamental analysis involves assessing external factors, industry trends and financial information
• Technical analysis involves the study of price charts using indicators to spot patterns
• Shell’s share price has fallen in response to the lower demand for oil caused by the Covid-19 pandemic

Footnotes

¹Deposits 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
²Tax laws are subject to change and depend on individual circumstances. Tax law may differ in a jurisdiction other than the UK
³Physical share dematerialisation fee is £100 (inclusive of VAT) per certificate. Electronic shares are transferred free of charge. IG SIPPs are administered by James Hay, who charge a £205 annual fee and may charge for transferring investments not currently held in a SIPP. You may be out of the market for a period while your transfer takes place