Tesla, led by Elon musk, presently enjoys king status among the top favorite stocks in the world. The company has changed the automotive industry with its offer of electric vehicles that can stand for future generations. Regardless of its price swings as a volatile asset, Tesla’s stock, TSLA, has been impressive since its debut in 2010. In the years following its debut, TSLA averages above 65% in growth.
Whether this pace results from admiration for Elon or the performance and looks of his company’s vehicles, many are hooked. Tesla produces vehicles that come with features like solar roofs and bioweapon defense models.
Given the TSLA stock’s electrifying growth, it is no surprise that you are interested in getting in on the action. If you want to purchase Tesla shares, then you should consider using an online platform or investment brokerage. In today’s guide, you will find out everything you need to know about buying TSLA stocks.
An overview of Tesla
Tesla is a vehicle manufacturing company headquartered in Palo Alto, California. Founded in 2003, the company specializes in designing, building, and marketing energy generation, innovative electric vehicles, and storage products. The company retains a large chunk of the global market, distributing its product across the world to Europe, China, and Australia.
Tesla’s mode of operation is in two ways: automotive operations and energy generation and storage facility. Automotive operations centers around the production of electric vehicles and their powertrain components. Through these operations, Tesla offers vehicle services and benefits such as Tesla Lending and Tesla Leasing to customers.
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Tesla’s energy generation and storage facility produce and sell renewable energy, energy storage products, and solar systems.
The global appeal and success of Tesla make it endearing to many investors. Tesla’s stock, TSLA, is a publicly traded asset available on the Nasdaq exchange. TSLA began trading at $17 when the company put it on initial public offering (IPO), with the price soaring to as high as $2,200 per share in 2020. Tesla split the stock five-for-one the same here bringing the price to $400. It took TSLA less than six months for the price to have double growth.
Fundamentals of TSLA
Tesla Inc. is more than just an electric car manufacturer and clean energy movement company. The company’s stock is one of the most heavily traded stocks available on Wall Street, with millions of investors transacting daily. On the Nasdaq exchange, Tesla’s stock is listed as TSLA.
Tesla made its debut in the S&P 500 on December 2020 as the fifth-largest member of the key stock index. It also belongs in the category of tech-heavy 100 index on Nasdaq. Addtionally, it is grouped in the consumer category with other companies focusing on consumers such as retailers and restaurants, amongst others.
Research Tesla for performance and potential
Never buy any stock including Tesla shares, especially if you have no idea what makes a stock price. Carry out research into Tesla’s financial details, present and future predictions. Since Tesla is a publicly listed company, it is required to publish details of its financial operations and health. You can easily find details of this nature on Tesla’s quarterly report, Form 10-Q, and its annual report form 10-K.
Financial information about Tesla is available to investors on its relations site as well as the Securities and Exchange Commission (SEC) database. Alternatively, brokerage platforms make information on available stocks and their industries. You can turn to third-party evaluation platforms such as Morningstar for an all-around analysis. A combination of expert ideas and financial statistics should help inform your decision of what to invest in the share.
A guide to purchasing Tesla shares online
After you decide to purchase Tesla stocks primarily based on your evaluation of its inventory, here are steps you will want to begin with.
Open a brokerage account
To buy a few Tesla shares to feature in your portfolio, you need to open an account with a brokerage platform. A brokerage is just like a middleman who facilitates trades between an investor and the trading marketplace. It helps in the acquisition and sale of traditional securities like bonds, shares, indices, and a few cryptocurrencies.
You can search for brokers that require low funding rates, access to alternative stocks, and margin rates and provide zero commission costs on buy and sell orders. Your choice of an online brokerage should leverage those with a simple, functional, instructional, and quality support system. This is particularly important in case you are new to investing in stocks. You should also consider if your country is available to trade using the brokerage platform.
If no brokerage platform appeals to you, we recommend some of the best in this manual. You can use eToro, TD Ameritrade, Robinhood, Charles Schwab, and Fidelity to execute your purchase of Tesla shares.
Choose an account type
It is essential to decide which account type suits your investment plan. Often, brokerages allow their users the option of opening different account types. There is the individual retirement account (IRA) which allows users some tax benefits. Investors who are 60 and above can get tax-free withdrawals and tax deductions depending on their choice of IRA plan.
On the flip side, creating an account that is taxable is suitable for users who invest to build wealth. A taxable account type is useful despite tax on every withdrawal on the account.
Monitor your Tesla investment
Although making the purchase of shares is a great idea, it is not advisable to neglect them over a long period of time. The only way you can know how well a stock performs is when you keep track of its growth. Regular checks on your Tesla investment can help you decide if your investment strategy is good enough or in need of some tweaks.
You can use the S&P 500, a benchmark index for growth to measure the performance of your shareholdings. Also, portfolio management tools and applications can come in handy too.
How much is suitable to invest in Tesla shares?
There is no standard to how much is preferable to invest in stocks. How much you need to invest in Tesla shares is dependent on you. However, if this question feels overwhelming for you to find an answer to, we provide some things you might consider before making an investment decision. In no order of importance, consider all the options equally.
- Manage your risk
Despite Tesla being a reputable company with a well-known stock, it is important to take all investments as risk. Don’t put in more than what you can afford to lose in case the market doesn’t go in your expected direction. Doing this is vital to getting a grip on your physical, emotional, and mental health. Your risk management can help you go through both bear and bull markets.
Additionally, you should refrain from investing if you seek short-term gains. The minimum experts recommend is to leave your investments for 5 years
- Investment strategy
Placing trades In the stock markets without an investment strategy is like searching for light in the dark. Experienced traders use two of the most popular strategies t invest in the stock market: dollar cost averaging (DCA) and investing in large lumps. The DCA strategy involves investing in stocks at intervals to mitigate risks. On the other hand, investing in lumps means using a large piece of the trading budget all at once on a particular trade. Although this is a bit risky, usually it is used when investors perceive the price of a stock price is low in comparison to its valuation.
- Set a trading budget
Never take investments as an automatic means to financial breakthrough. The amount you invest in Tesla shares should result from what is left of your budget. Remember, you only invest what you can afford to lose. Before you budget for stock investments, make sure to settle your debts, and pay for bills, retirement, and emergency funds. It is only after these are out of the way you should determine what you invest in Tesla or other stocks.
- How well does Tesla fit into your investment portfolio?
As always, your investment goals and portfolio should come first before any investment is made. Ask yourself if Tesla is a good fit for your portfolio. Diversify your portfolio by getting other assets to reduce the risks of having just one company’s stock alone.
- What is the current price of TSLA?
Although prices of stocks are always changing, in the past year, TSLA’s price has been hovering above $400 per share. Given its high price and your trading budget you might consider buying fractionalized TSLA on supporting brokerages.
You can begin to invest in Tesla or other shares when you are certain you fulfill all requirements above.
Deposit money into your account
Funding your account with money is the next step to purchasing shares. Check for the minimum amount your broker requires users to have in accounts. Many brokers allow investors to deposit money using several payment gateways like Skrill, direct bank transfer, and PayPal amongst others.
Execute a buy order
A decision on which order you want your broker to execute is important when buying Tesla shares. You have a choice of a market and limit order amongst others. A market order triggers a purchase or sale of an asset on your brokerage platform at the current market price. However, the bid-ask spread of the asset might make the order fill as a price slightly above what you see when you placed the order.
Setting a limit order signals you want the brokerage to execute your buy order at a specific price. You should realize that you might miss out on market moves when your target price is not triggered and the price keeps soaring.
Place an order for Tesla shares
After funding your account, you can now place trades on your broker for some Tesla shares. Search for the symbol of the Tesla share, TLSA, on your broker and input in the dollar the amount of the shares you want. If your broker allows you to trade in fractional stocks, you can also execute the trade.
Since Tesla is available for trade on the Nasdaq exchange, you can make a purchase from 9:30 a.m. to 4:00 p.m. ET Monday through Friday. However, you can buy at extended before and after market trading hours from 4.00 p.m. to 8 p.m. ET. These trades would trigger once the market is open again for trading.
Review your investment in Tesla
Regardless of whatever stock you invest in, it is recommended that you check its performance at intervals.
One way to monitor how well your TSLA investment performs is, to begin with, the percentage of the annual return. You can easily use these statistics to compare with other high-performing stocks of other companies. This can also prove useful when you review Tesla’s price movements for positive outcomes.
To measure how well TSLA performs over time, you can consider using industry standards such as Nasdaq Composite Index and the S&P 500. Overall, this comparison would give you a clue of how well Tesla’s stock performs in the market.
Purchasing Tesla on eToro
eToro is one of the leading brokerages in the world and a highly recommended choice for beginners in stock investment. The trading platform allows users to operate virtual accounts with virtual funds to test trading strategies before starting with investments. It also offers social trading features, where users can copy professional investors’ trades.
To purchase Tesla on eToro, users have to create an account with the trading platform. If you already have an account, simply log in and follow the process. Also, you might want to complete your profile before placing a buy order for your preferred shares.
eToro requires users to provide information such as name, email address, phone number, and location. To complete your profile the platform would request more information about the user’s identity, complying with AML and CTF regulations.
The deposit amount on eToro depends on the country an individual resides. And a minimum of $200 is required to start. You can make use of bank transfers, Skrill, UnionPay, PayPal, and other funding methods supported by the platfrom.
Final words
If you intend to purchase TSLA stocks, it is essential you set up an account with a reputable broker. Also, you should consider doing research on Tesla’s performance and financials to see if it aligns with your financial goals.
