Trading Amazon on Anthropic AI Cloud Investment News
The world's largest cloud operator and retailing giant Amazon announced a $4 billion investment into San Francisco AI startup Anthropic. Learn more about Amazon's minority stake in the ChatGPT rival and what analysts are forecasting for the stock below.
|Symbol for Invest.MT5 Account:||AMZN|
|Date of Idea:||25 September 2023|
|Time Line:||1 - 6 months|
|Position Size for Invest.MT5 Account:||Max 5%|
- The Invest.MT5 account allows you to buy real stocks and shares from 15 of the largest stock exchanges in the world.
All trading is high risk and you can lose more than you risk on a trade. Never invest more than you can afford to lose, as some trades will lose and some trades will win. Start small to understand your own risk tolerance levels or practice on a demo account first to build your knowledge before investing.
Amazon's $4 Billion Anthropic AI Cloud Investment
While Amazon operates the world's largest cloud network (AWS), it has been slower than its rivals to gain a foothold in developing and deploying artificial intelligence technologies. That has now changed with Amazon's plan to invest $4 billion into San Francisco-based AI startup Anthropic.
Anthropic was founded by former executives from OpenAI. The startup will initially receive $1.25 billion with a further option of $2.75 billion as part of the deal. The focus is to train Amazon's language models on chips that have been purchased by Amazon.
Amazon CEO Andy Jassy explained that Amazon will get access to Anthropic's AI technologies and plan to build them into its cloud offering. This includes Amazon Bedrock which is AWS's new product which enables companies to build generative AI applications and AWS Trainium which is its AI training chip.
Amazon Business is one of the company's fastest-growing services, but it remains to be seen how Amazon will monetize the use of AI through its services. While it may add to the experience of existing products, investors will want to see if it can have an effect on Amazon's bottom line.
Investors may be more concerned with Amazon's plans to include limited ads in its Amazon Prime Video. As these users already pay a subscription to the service, some fear introducing ads to this tier could send streamers to other rivals such as Netflix, Apple TV+, Disney+, etc. which may a negative impact on Amazon's user base and, therefore, streaming revenue.
Amazon Stock Forecast - What do the Analysts Say?
According to analysts polled by TipRanks for an Amazon stock forecast in the past 3 months, there are currently 39 buy, 1 hold and 0 sell ratings on the stock. The highest price level for an Amazon stock forecast is $230.00 with the lowest price target at $140.00.
The average price target for an Amazon stock forecast is $176.18.
An Example Trading Idea for the Amazon Stock Price
An example trading idea for the Amazon share price could be as follows:
- Buy the stock on a break above $133.00 to allow for volatility.
- Target just below the highest analyst price target of $230.00.
- Keep your risk small at a maximum of 5% of your total account.
- Time Line = 1 – 6 months
- If you buy 10 Amazon shares:
- If target is reached = $970.00 potential profit [($230.00 - $133.00) * 10 shares].
Remember that markets go up and down and it is unlikely the share price will move up in a straight line. In fact, it may even go much further down before it rises, especially considering how volatile AI-related stocks can be.
Be sure to exercise good risk management and always know how much you could potentially lose on a trade, the risks involved, as well as the costs.
With the Admirals Invest.MT5 account you can buy and sell US stocks with a commission from $0.02 per share. This means buying 10 shares in Amazon stock would result in a commission of $0.20 ($0.02 * 10 shares) for executing a per-side transaction.
There is a low minimum transaction fee of $1. So, the example trading idea above would result in a commission of just $1 overall!
How to Buy Amazon Stock in 4 Steps
With Admirals, you can buy shares in US stocks with a competitive commission from $0.02 per share and a low minimum commission of just $1.
- Open an account with Admirals to access the dashboard.
- Click on Trade on one of your live or demo accounts to open the web platform.
- Search for your stock in the search window at the top right to view the live price chart.
- Click Create New Order from the bottom of the screen to open the trading ticket.
Click on the banner below to trade Amazon stock today! ▼▼▼
Do You See the Amazon Stock Price Moving Differently?
Remember that all analytics and trading ideas are based on the personal view and experience of the author.
If you believe there is a higher chance Amazon share price will move lower, then you can also trade short from a CFD (Contracts for Difference) trading account which Admirals also provide.
This means you can trade long and short to potentially profit from rising and falling stock prices.
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