How to trade Telstra Shares

1. Telstra shares: what you need to know
2. How to trade Telstra shares
3. How to analyse Telstra shares

Understanding Telstra: a brief history

Telstra considers itself Australia’s leading telecommunications and communications company, with a commercial lineage that extends all the way back to the 1850s. The company and its antecedence were a fixture in most of the major developments in Australia’s technological and communications history, and remains a major corporate presence in the nation today.

The privately listed company known today by most investors came to life in the early 1990s, as a result of a merger between Australia’s Overseas Telecommunications Commission and Australian Telecommunications Corporation. After several years of operation, the new company was renamed ‘Telstra Corporation.'

In the late 1990s, the Federal Government began the slow process of privatising the telecommunications giant, only completing the process in full in 2011. Telstra is now a fully independent commercial institution; and is seeking to define itself, with the roll out of the NBN, as Australia’s major communication technology firm, with international growth ambitions.

Telstra shares: the basics

Telstra shares are traded on the ASX, and under the stock ticker 'TLS' and it’s also a constituent of the ASX 200. The company is Australia’s largest listed telecommunications company, and has been historically considered one of the country’s ‘blue-chip, large-cap stocks.'

As of June 2019, there was almost 12,000,000,000 shares floated on the market. Finding this exact figure at any point in time can be used by shareholders to calculate the size of their total share in the company.

Telstra’s key personnel: who manages the company?

Trading Telstra shares

An individual can benefit from fluctuations in the price of Telstra shares utilising derivatives such as CFDs. When you trade, you can profit from the rising or fallings of the price of the shares as you don’t take ownership of the underlying assets – rather you speculate on the share price. In the event you think the Telstra share price will rise, you buy (go long) and if you believe that the Telstra share price will fall, then you sell (go short). Moreover, because trading includes the use of leverage, a trader can gain greater exposure to changes in the Telstra share price than what they would by purchasing the physical share. This means that greater profits can be achieved with a smaller financial outlay; but, of course, at a much higher risk.

What is Telstra’s strategy?

Telstra is currently undertaking a significant restructure, in order to reposition the business to tackle the changes in digital communications, especially beyond the roll out of the National Broadband Network. This has meant major job cuts, and changes to the corporations operating model. The so called 'Telstra2022' strategy rests on 'four pillars':

1. The simplification of product offerings, elimination of customer 'pain points' and the creation of 'all digital experiences.'
2. The establishment of a standalone infrastructure business to drive performance and support the company after the NBN roll out.
3. The simplification of the business’ structure and ways of working, in order to empower the company’s people, and better serve customers
4. The implementation of a cost reduction program and portfolio management

Telstra fundamental analysis: how to analyse Telstra