How to Buy Tesla Shares UK
At the start of 2020, investors were still fiercely arguing about whether the bulls or bears had the upper hand. Over the past year, the question has been very definitively settled: Tesla stock rose over 740% in 2020 and the company joined the S&P 500 index at the beginning of December.
Now, Tesla is larger than the 9 largest traditional automakers combined. That’s despite the fact that Elon Musk’s company only delivered around half a million cars last year.
In this guide, we’ll show you how to buy Tesla shares UK with no commission.
Find a UK Broker Buy Tesla Shares UK
Before we show you how to buy shares in Tesla, first you need to choose a regulated UK stock broker. Tesla trades on the NASDAQ stock exchange in the US. So in order to buy shares of this company, you’ll need a UK stock broker that offers trading on US shares.
The good news is that Tesla is a big enough company that most UK brokers that support international markets offer the company’s shares for trading. So, you can choose a broker based on other factors like the cost of trading, the types of trading tools available, and how trustworthy the broker is.
So, let’s take a look at two popular UK brokers you can use to buy shares in Tesla.
eToro is a broker and a popular automated trading app in the UK, offering more than 800 shares from markets in the UK, US, and around the globe. You get to choose between trading Tesla CFDs with 0% commission or buying shares outright. If you choose CFDs, you can apply leverage to your trades up to 5:1.
eToro’s trading platform includes a wide variety of tools for short term stock trading and long-term investing. The charting interface, available for desktop and mobile, includes more than 100 technical studies and drawing tools built in. On top of that, the platform includes a news feed, economic calendar, price alerts, and price forecasts from professional stock analysts.
Another key feature to eToro is the platform’s social trading network. You can connect with millions of traders to share trade ideas, find new strategies, and gather information. The social network enables eToro to offer a market sentiment gauge with every stock, so you know whether eToro traders are buying or selling a company’s shares. You can also copy other traders’ positions to build a strategy or investing portfolio in minutes, which makes it even easier to learn how to buy Tesla stock UK.
eToro doesn’t charge any fees for share CFD trading or for forex trading, cryptocurrency trading, or commodity trading. There is also no monthly fee to worry about with this broker, although you will pay a £4 withdrawal fee and a £15 inactivity fee if you don’t place a trade for a full year.
eToro is regulated by the UK’s Financial Conduct Authority and all accounts are protected by the FInancial Services Compensation Scheme. Another plus to this broker is that it offers customer service 24/5 by phone or email.
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Libertex is a forex broker that also offers stock trading, commodity trading, and cryptocurrency trading. The selection of stocks isn’t huge – Libertex only offers CFDs for around 60 different shares, primarily from the US – but Tesla shares are available. Plus, you can trade with leverage up to 5:1.
One of the things that makes Libertex unique is its approach to trading fees. Libertex charges a low commission of around 0.1% to 0.2% per trade, with no additional spread. That ends up being cheaper and more predictable for many traders than spread-based fees, which is a major plus for this brokerage. In addition, Libertex doesn’t charge any account fees other than an inactivity fee after 180 days without trading.
We also like Libertex’s trading platform, which is available over the web and as a mobile trading app. You get access to dozens of built-in technical indicators and drawing tools, plus a news feed and economic calendar. Libertex doesn’t have a ton of fundamental data or analyst reports, however, so this broker’s tools are more suitable for technical trading.
Libertex is regulated by the Cyprus Securities and Exchange Commission (CySEC), which is one of Europe’s highly regarded financial watchdogs. You can fund your account with a variety of common payment methods, including credit cards and e-wallets like Neteller and Skrill. Libertex offers support 24/5 by email in case you need help setting up your account.
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Analyze Tesla Shares
It’s important to do your research on this company and come to your own conclusion about what it’s worth. Let’s take a closer look at Tesla’s past.
Tesla Share Price UK
Tesla, the electric vehicle manufacturer run by Elon Musk, was founded in 2003. The company went public in 2010 at a price of $17 per share, raising $226 million in the process.
For many years, the stock traded relatively flat. By 2014, however, it grew to encompass half the market cap of Ford, the largest American car maker at the time. Since Tesla produced only tens of thousands of cars a year at the time and had a luxury price point, the company was famously shorted by many renowned hedge funds and investors. In fact, short bets on Tesla made up a huge portion of trading on the company’s stock until earlier this year.
By the start of 2020, Tesla stock had reached an – at the time – eye-watering price of nearly $500 per share. Then the Tesla share price went exponential. Tesla gained more than 740% in 2020. After accounting for a 5-to-1 stock split in September, Tesla ended the year at over $750 per share ($3,750 before the split).
Tesla’s growth was fueled by several factors, all of which grew on themselves. First, it was a stock market darling at a time when a massive number of new traders piled into the market thanks to the coronavirus pandemic.
Second, Tesla announced significant advances in its self-driving car technology and announced plans for a consumer vehicle in the $25,000 price range.
Third, Tesla finally approached its long-held goal of producing 500,000 vehicles in a single year – in a year when manufacturing was severely impacted by the COVID-19 pandemic.
Finally, Tesla was added to the S&P 500 index, which meant that billions of dollars’ worth of funds started investing in Tesla at the start of December.
Tesla Stock Fundamentals
At the current Tesla share price of $816, Tesla now has a market capitalization of $773 billion. That makes it the 4th largest company in the US and larger than the 9 largest car makers in the world combined.
From a fundamental perspective, Tesla’s valuation is extreme. The company has a price-to-earnings (PE) ratio of 1,617. For reference, the PE ratio of the S&P 500 is around 38 and Amazon’s PE ratio is 92. There are almost no companies in the world that are more overvalued than Tesla based on earnings.
Of course, current earnings are less important to Tesla investors than future earnings. Tesla saw earnings growth of 73% year over year, which is unheard of for most companies. Revenue grew nearly 40% in 2020 as well.
Tesla Dividend Information
Tesla does not pay a dividend and is not expected to for many years to come. The company is still heavily invested in growth and is likely to plow any excess income into research and development or expanded manufacturing capabilities.
In 2020 alone, Tesla stock gained 740% and Tesla became one of the largest companies in the world by market cap.
Tesla stock is risky, especially since the company is extremely overvalued based on traditional earnings metrics.
What is Tesla’s stock ticker symbol?Tesla trades on the NASDAQ stock exchange under the ticker symbol ‘TSLA.’
Can I buy fractional shares of Tesla?Yes, if you use some brokers you only need to invest a minimum of $50 in Tesla shares.
How many cars did Tesla produce in 2020?Tesla delivered 499,550 cars in 2020, just shy of the company’s goal of 500,000. This was despite Tesla’s California factory shutting down in April due to COVID-19.
How much of the electric vehicle market does Tesla control?Tesla has a 17% market share in the electric vehicle market globally. In China, one of the fastest growing auto markets, Tesla controls 21% of the electric vehicle market.
Does Tesla own Elon Musk’s other companies?Tesla owns Solar City, a solar energy company founded by Elon Musk. However, Tesla is a completely separate entity from SpaceX, The Boring Company, and PayPal.