A complete guide to Facebook: what you should know about Facebook shares

Facebook shares: the basics

Facebook trades on the NASDAQ exchange under the ticker FB. It is a constituent of the NASDAQ 100 composite and famously part of the group of tech stocks known as FAANG – alongside Apple, Amazon, Netflix and Google (now Alphabet). As of February 2021, Facebook had 2.4 billion outstanding shares and a market cap of £760.93 billion.

Facebook share price performance

Although Facebook shares declined in the March 2020 equities sell-off, its price quickly bounced back and even reached an all-time high in August. This was due to the increasing demand for online advertising caused by the global pandemic pushing commerce online. The shares were up 33% in 2020 despite controversy surrounding its regulation of hate speech and misinformation on coronavirus.

On 18 February 2021, it was announced that all Australian news organisations are banned from posting content on Facebook and no Australian Facebook users will be able to link to news articles. This was a pre-emptive move ahead of the planned Australian law that would force Facebook and other internet companies to reach commercial deals with these news outlets.

The news caused Facebook shares to fall by 1% in pre-market trading. However, Facebook’s head in Australia and New Zealand, Will Easton, outlined that the content only accounted for 4% of content, while Facebook accounted for 5.1 billion clicks to the news sites. This underscored the firm’s belief that its services are of higher value to news outlets, than news outlets are to Facebook.

The decision was later reverse, after the Australian government agreed to change its policy - indicating the negotiating power big tech has. 

How to buy and sell Facebook stock

1. Open an account
2. Search ‘Facebook’ in our platform
3. Choose our CFD or spread bet market
4. Decide whether to ‘buy’ or ‘sell’ in the deal ticket
5. Enter your position

When trading Facebook stock, you’ll also be getting exposure to the other brands Facebook owns – such as WhatsApp, Instagram and Oracle.

You can speculate on the price of Facebook shares via CFDs. Unlike traditional investing, you won’t take ownership of the underlying assets, which means you can go long or short – benefiting from rising and falling prices.

Spread bets and CFDs are also leveraged, so you can get full market exposure for just a small initial deposit – known as margin. While leverage can magnify your profits, it can also magnify your losses. This makes it important to have a risk management strategy in place before you enter your position.

What is Facebook’s business model?

Facebook is a website that allows users to create a profile and connect with their friends, colleagues and even strangers from all over the world. The platform facilitates the sharing of images, music, videos and news articles.

As of 2021, Facebook has over 2.8 billion monthly active users. A large portion of Facebook’s revenue comes from its users in the US and Canada - as much as 45% or $38.4 billion.¹ The other 55% of its revenue comes from other regions across the globe.

Facebook’s primary revenue stream is advertising – which makes up 98% of its total revenue according to its FY2020 earnings report. It sells advertising space on its various social media platforms, including Facebook, Instagram, Messenger and other third-party sites and mobile applications. As such, Facebook competes with other advertising platforms such as Apple, Alphabet and Tencent Music Entertainment, as well as social media sites like Twitter and TikTok.

Who owns Facebook?

Facebook was founded by Mark Zuckerberg, who still owns 29.3% of FB shares – making him the largest individual shareholder. Thanks to his ownership of Facebook, Zuckerberg is considered one of the ten richest people in the world.

In fact, in August 2020, his net worth exceeded $100 billion when Facebook stock hit it’s all-time high of £303.91, making Zuckerberg the youngest person in history to reach centibillionaire status.

See our full list of world billionaires and their companies.

Facebook directors

What brands does Facebook own?

Perhaps the two most well-known brands under the Facebook umbrella are Instagram – which FB bought in 2012 for $1 billion – and WhatsApp, which is acquired for $19 billion in 2014. Thanks to these acquisitions, Facebook owned four of the ten most downloaded apps in 2020.²

Since 2005, it’s estimated that Facebook has spent more than £23 billion on acquisitions of tech, apps and software companies. The rough figure is 70, but many went undisclosed to the public so it could be more.

Other than Instagram and WhatsApp, the biggest disclosed acquisitions are Oculus, a virtual reality company, CRTL-labs, a neural interface start-up, and LiveRail, a video supply platform.

¹Securities and Exchange Commission, 2021