2 of the best stocks to buy now with $ 500


The most important first steps to financial freedom are to pay off high interest debt and set aside an emergency fund worth at least six months of spending. After that, investing capital in long term investments is an attractive option to consider.

Even a relatively small amount of money can make a big difference over time. If you have $ 500, you are ready to invest, then look no further than these two best stocks.

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The online marketplace for unique products

Through growth in e-commerce and consumer support for small businesses, seller of handmade and vintage items Etsy (NASDAQ: ETSY) benefited greatly. In the first six months of 2021, the e-commerce platform saw gross merchandise volume (GMV) increase 53% to $ 6.2 billion, revenue jump 64% to 1, $ 1 billion and net income skyrocket 122% to $ 242 million over the same period. year.

The company now has 5.2 million active sellers and 90.5 million active buyers trading on its platform. Both figures are up significantly from the second quarter of last year.

The potential for the future is still enormous. There is a $ 27 billion online marketplace for Etsy’s types of products, from clothing and crafts to home decor and toys. According to a 2020 survey, 88% of Etsy shoppers say they find items on the site that they can’t find anywhere else. The value proposition is surprisingly clear. Regular shoppers – those who had six days of purchase and spent at least $ 200 in the past 12 months – rose 115% in the last quarter. Increasing the engagement of its most loyal customers is a very positive sign for Etsy.

And for sellers, the Etsy platform offers remarkable flexibility. Many can change their operations and start selling anything in high demand at any time like face masks in 2020. The company also provides valuable services like Etsy Ads and Etsy Payments to help these entrepreneurs run their small businesses.

While Etsy has buyers and sellers from all over the world, management is currently focused on seven main markets: the US, UK, Canada, Germany, Australia, France, and Australia. India, all of which represent a colossal market of 1.7 trillion dollars. And the recent acquisitions of Depop, a second-hand fashion retailer, and Elo7, a Brazilian online marketplace, should only strengthen Etsy’s long-term prospects.

Etsy’s stock has more than sevenfold since its IPO in 2015. But over the past six months, it has remained essentially flat as investors may fear that a calming pandemic could slow the growth of the company. I think these fears are overblown, especially since Etsy offers a truly differentiated shopping experience and has a strong competitive position in the ecommerce space.

Person who checks with contactless payment by phone.

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Disrupting the financial services industry

Digital payments take off and Square (NYSE: SQ) overlaps this trend to new heights. Digital payments processor revenue climbed 143% year-over-year in the last quarter, after soaring 266% in the first quarter. Square processed $ 42.8 billion in gross payment volume (GPV) in the last quarter, up 88% from the same period last year. In the past 12 months, GPV has totaled nearly $ 140 billion, make Square a formidable player by advancing the cashless economy.

This leader fintech operates a growing two-sided ecosystem that includes both retail and business customers. Its popular Cash app, which allows users to send and spend money, set up direct deposit, buy and sell stocks as well as Bitcoin, now has 40 million monthly active users. For sellers, Square offers a wide assortment of financial services software, hardware, and tools to help them accept payments and manage other aspects of their business. Large sellers, or those with an annualized GPV of at least $ 125,000, accounted for 65% of the payment volume in the quarter.

Square’s ability to strengthen the connection between its Cash app and seller ecosystems puts the company in a strong position. Cash App Pay, which launched in September, allows Cash App customers to pay at Square merchants using their balances for in-person and online transactions. And the integration of the leader “buy now, pay later” After paymentThe 16.2 million consumers and nearly 100,000 merchants on the Square platform offer users another payment option.

Management estimates the global revenue opportunity for Cash App to be at least $ 60 billion and for sellers to be over $ 100 billion. With 12-month revenue of $ 15.9 billion, the company clearly has a long way to go. And consider that cash is still the most widely used means of payment in the world.

Like Etsy, Square has been a winning monster since its IPO in 2015, with an incredible 1,720% increase since then. In the past six months, however, the stock has fallen 9%. Investors today have the option of buying shares in a company that Wall Street analysts say will increase profits more than seven times from 2020 to 2023. It seems like an obvious decision.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are motley! Questioning an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.


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