Revolutionary products created by this company have changed the game undeniably in many different markets (from solar roofs and cars with armed defensive modes to vast AI infrastructure).
And so we’ve seen huge increases in past Tesla share ROIs. Tesla's recent financials reveal an astounding 80% year-over-year gain in revenue, despite the price consequences of Elon's Twitter purchase and the global recession.
So, if you're interested in buying Tesla shares in 2023 to take advantage of the company's reputation, here's your beginner’s guide.
Table of Contents:
How to Buy Tesla Stock the Fastest Way Possible
Short on time to study a new subject? Do you just want Tesla stock as soon as possible for a good rate?
No sweat. We've discovered the quickest way to purchase Tesla stock in the UK. These simple instructions can take under 30 mins and as little as ten:
- 1. Sign up. Visit eToro's website and click the “Join Now” button to sign up. Input your personal data to generate a login name and password.
- 2. Time to verify your identity and the billing address associated with your eToro account before making any Tesla shares purchase.
- 3. Put down some money. Put in at least £7-£8 in your trading account using the method of your choice.
- 🚀 4. Enter “TSLA” into the ticker symbol search and click “Trade” to buy Tesla stock.
We’ve landed 🏝️.
Keep reading for a complete beginner’s explanation. Let’s go.
eToro — Popular Broker for Learning How to Buy Tesla Stock
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When learning how to buy Tesla stock, you need as much understanding about your chosen platform and the services available.
Gaining familiarity with the platform, its features, and trading options is a breeze with the help of a practice account or demo.
A demo account enables you to experiment and test the platform and features before transferring to an actual trading account.
The demo account mirrors the real account setting you’d expect when using real cash… When you go to a live account, you trade with money you may earn actual profits with the typical risk. With a demo account, you may test the waters of trading and the platform without putting your own money at risk.
How you benefit from eToro’s Demo
As we explain in our review of eToro, an eToro Practice Account (or eToro test account) is a free trading account that enables you to test trades, explore features, and work on strategy, without the danger of a real trade but with the exact same capability as a live trading account. (Equivalent to AvaTrade's free practice account.)
Whether you're a seasoned veteran or just starting out, trading on a brand-new platform may be a real headache. This is because the broker platform is unknown even after you have carried out all of your homework. That's why brokers provide practice accounts, so new customers may become acclimated to the platform with no risk.
Practice accounts provide access to a simulation of the real trading setting. This implies that demo and live accounts are the same where the demo mirrors actual price patterns and swings, supplying real and educational trading tools and indicators, and delivering an overall genuine experience. The primary difference is that with a demo account, you will not spend your personal money on trades, which makes trialling a new broker risk-free.
For novice traders, a demo account may be a great way to get their feet wet in the Forex, stock, and commodity markets. Beginner traders may learn the ins and outs of the foreign exchange market, narrow down their preferred trading instruments, and settle on an approach that works best for them all with the help of a trial account.
Even seasoned traders benefit from demo accounts since they provide a safe zone to test out innovative trading software and refine intricate trading techniques. Whenever they want to try out a new trading technique and find out how various spread levels perform for them, a demo account is utilised as a free platform for traders.
Check out our eToro vs IG Review UK for additional details.
Where can you find the eToro’s demo account?
The eToro Practice Account is straightforward to find and use. Get it right after you register with eToro. Creating a demo account and a real money trading account is possible after completing a short and painless registration procedure.
Here we shall take a deeper look at the procedures necessary to finish the eToro registration process. Once this is complete, you will have access to your trader profile, all of your eToro trading information and access to your demo and real trading accounts. If you follow these instructions, you should have no trouble getting started:
- Visit the eToro website and click ‘Sign Up’ and you will be led to an online application form.
- Simply enter your name, your phone number and pick a username and password
- Be sure to read the Acknowledgement, Terms and Conditions, and Privacy Statement page.
- To sign up, just click the “Create Account” button.
You’ve successfully registered and set up your account!
Step 1: How to Buy Tesla Stock: Create a Trading Account
You will need a broker account in order to acquire Tesla shares. Take a look at the brokerages and investment apps we recommend if you don't already have an account with them. Be aware of deposit minimums and costs, even though most brokers now allow you to trade commission-free.
When choosing an investment account, it is important to keep in mind the investor's long-term financial objectives.
Consider creating an ISA if you care about preparing for retirement. It's possible to avoid capital gains taxes by agreeing to restrict its use. Extra fees or taxes might be put on withdrawals made at non-trading-hours times or for unauthorised purposes.
Step 2: How to Buy Tesla Stock: Goal-Setting
Last year, when Tesla CEO Elon Musk stated the company would no longer accept Bitcoin as payment, the value of the cryptocurrency promptly plunged by 15%.
Tesla stock has less volatility than crypto but it is still susceptible to market news and events.
So before buying Tesla stock, consider your risk tolerance and the stability and diversity of your other investments.
Be fearful when others are greedy
That quote above comes from legendary investor Warren Buffett. The difficulty of making an investment plan comes when one tries to base it on realism.
Many investors believe it is best to buy stocks when their prices are plummeting and the news is covering nothing but terrible reports about the company. With Tesla in its current form, it could seem like a good time to buy shares and hold them for the foreseeable future if you use that quote above, whereas other investors believe Tesla is overvalued.
In any case, before putting your money down, you should do your homework and trust your own judgement. Exactly how do you feel about Tesla? In your opinion, is it a good idea to invest in this firm?
A blank cheque from you is very unlikely to be accepted by Elon Musk. So, before deciding how much to put into Tesla initially, there are certain things you should ask yourself:
Do I know my financial situation…? You should not invest in Tesla until you have thoroughly considered the company and its potential outcomes. Retirement savings, monthly expenses, and an emergency fund all need to be possible within your means. Once you've paid for them, you're free to use that money toward anything you choose, including purchasing Tesla shares.
Do I have a grasp of the price of TSLA shares...? The potential to invest in Tesla shares has become much more realistic as of late. A share in Tesla was valued at approximately £250 until very recently. Because of this, some people may think about adding it to their portfolios alongside gold or other forms of diversification.
How will I be putting my money to work…? It's usual practice to invest in either a big amount or a series of smaller instalments over time. Second, dollar cost averaging may help you spread out your stock purchases over a longer period of time and, theoretically, pay less overall on shares. Your money is invested in the stock market immediately rather than waiting for you to achieve some arbitrary amount.
What other holdings do you have to balance against…? Tesla shares are probably not the best investment for your emergency fund cash. Given this, it's important to think about how it will affect your other financial obligations and your long-term goals.
Head to the Buying Guide section for a 2023 and 2024 news update on Tesla shares. But here is the process of reviewing as a beginner.
First, you need to do your research on Tesla's finances, performance, and projections before you acquire their shares or any stock. There are many ways to do this. You’ll learn a lot about a firm by reading its annual report (10-K) and quarterly reports (10-Q). Companies like TSLA that are publicly listed are compelled to publish significant financial details in these.
Either do a search of the various financial regulatory databases or go to Tesla's investor relations and press release website to find these documents and learn more.
Using financial data and expert opinion, you can decide how much of your savings to put toward a Tesla purchase.
Step 3: How to Buy Tesla Stock: Share Volume
You have a lot of options here. But let’s begin with deciding the basics of balancing expenses against your budget.
If you're trying to decide how many shares of a certain stock to purchase, there are a few things to keep in mind.
It's important to think about things like diversification and whether or not you can acquire fractional shares of stock in addition to your available funds.
So, to assist you in how many shares are best for you to invest in, we've compiled this handy section.
Calculating your spend
Do you know how many shares you can purchase for the amount of money you have? Let's start with the share cost and see what volume you can afford. The number of shares you may purchase with a given amount of money is a simple calculation, provided your broker does not charge fees for stock transactions (which is the case with most big online brokers).
What follows are 3 steps:
- Locate the current Tesla price per share. A quotation can also be obtained from either your broker. Verify that the quotation is up-to-the-minute and not laggy.
- Take the total amount you can afford to invest and divide it by the stock's per-share price.
- Shares available for purchase are the consequence if your broker enables fractional purchases. If you can only purchase entire shares (which is the norm), then round down to that amount.
To illustrate, suppose you had £1,000 to invest and would want to purchase shares of Tesla (NASDAQ:AAPL). Let’s say one share of Tesla (Guide: How to Buy Apple Shares) is valued at £100. When you divide those two figures together, you get 10 shares.
So in this example, you can afford to purchase 1-10 shares of Tesla, keeping in mind that your broker might also offer fractional shares.
Step 4: How to Buy Tesla Stock: Ordering and Rebalancing
Now you've settled on the amount you're prepared to put into Tesla, let’s talk about buying shares. When looking to buy Tesla stock, look for the ticker symbol “TSLA” on your broker's website and enter the appropriate number of shares along with the corresponding dollar amount.
By contrast, to purchase TSLA only below a certain price level, you can use a more sophisticated order type, such as a limit or stop, rather than a default market order (which would buy shares at the current/spot price).
For Tesla, markets are open on the Nasdaq Mon-Fri, 9:30AM-4:00PM ET. If your app facilitates pre/after-market trades, you’ll be able to continue placing orders before/after the market opens. Even if you order when the market closes, it will be processed once it reopens.
New message: You’ve got Tesla shares!
We’re not done yet… The rate of return expressed as an annualised rate is a useful benchmark for tracking your buy. By comparing TSLA's performance in the past to other comparable businesses, you now have a better idea of where it stands. You can check Tesla's financial statements to make sure the firm is still on the correct track.
Examine TSLA's performance relative to the LSE, S&P 500, the Nasdaq Composite, and other stocks, among other metrics. See how Tesla stacks up against the competition with this information.
In order to rebalance a portfolio, trades are made and assets sold until the portfolio's holdings are once again spread out evenly. Should a change in investment strategy or risk tolerance necessitate an adjustment to the portfolio's allocation, rebalancing may be employed for this.
The frequency of rebalancing should be determined by a number of factors including personal preferences, transaction fees, and taxes (for example, if there are capital gains).
A person's age is also a consideration. It's possible that people under 40 don't need to rebalance their portfolios as often, but those who are getting close to retirement and want to maximise their earnings should. If any of your assets haven't risen substantially in a year, you could wait longer than a year before doing an evaluation.
Additionally, it may be necessary to reevaluate an asset portfolio if personal circumstances change. Even if your own investment preferences vary from those outlined here, you may use them as a starting point to rebalance your stocks.
- Tracking: If you’ve recently agreed upon a brilliant asset allocation plan and made purchases across all diverse classes in accordance with that plan, it is important to keep careful tabs on the total expense of your portfolio. As such, this information acts as a benchmark against which to measure your holding’s long-term success.
- Comparing: You should review your portfolio's overall worth and the valuations of its constituent assets at a later date. One way to determine a fund's proportional share is to divide the value of each asset class by the portfolio's overall value at the moment. Compare this sum to your initial estimates and see whether it's close. Can you tell me whether there have been any major shifts? If there is no immediate need for the money in the portfolio and no one with financial experience is available to handle it, leaving the money in the account may be the best option.
- Adjusting: If you believe that adjusting your portfolio's asset allocation has altered the risk profile, you should get a percentage of the current value of your portfolio to the weightings you originally gave by each asset class. If you want to keep your present asset allocation, these numbers will tell you how much to put into each asset class.
Optional Step 5: How to Sell Tesla Stock: Selling
To liquidate your Tesla stock, use your trading app as per norm and enter the number of shares to sell. Double-check the order type and choose whether you want to sell at the present price or wait for a specified one.
Taxes will depend on whether you sell the shares for more than you paid or if you used a tax-deferred account like a ‘Stocks & Shares’ ISA.
How long you hold on to TSLA shares might affect the amount of capital gains tax you pay. If you anticipate making a sizable profit from the sale of your Tesla investment, you should talk to a tax professional about your options.
TSLA stocks: how to sell…
You may place the same kinds of orders when selling shares as when you're purchasing them. The key to cutting down on stock-buying costs is selecting the appropriate order types. As the seller, your primary focus should be on limiting losses while maximising gains.
With market orders, your purchase will be processed instantly at the current market rate. The final cost may vary from what you initially expected based on fluctuations between when you transact and when it is finalised. There is always the chance that something unexpected will happen during the execution period that would leave you unable to cancel selling your Tesla shares.
You may prevent this from happening by using order limits, setting it to trigger if the stock price reaches or exceeds a specified limit. If you put in a limit order to purchase £10 worth of shares, it won't be fulfilled until the price of the stock reaches or exceeds tenner during the trade. It's possible that this won't rise to where you think it should, stopping you from making a profit.
If an asset drops below a predetermined threshold, the stop-loss order will be automatically executed to limit losses. The order gets executed as a market order if and only if the share price falls to that level (for example, £5 for a share that is now £6). It's possible that you'll have to sell at levels lower than your stop loss if there is no floor.
Altogether, you'll be responsible for establishing the system's boundaries and stops. If the current offer is £10 and you make a limit of £8, for example, your purchase will go through as long as the new bid is at least £8.01 or higher. If the stock suddenly drops below that price, which can happen in a turbulent market, you run the danger of being prevented from selling altogether.
ETF and Index Funds
Have you considered buying Tesla stock using an ETF or index fund? It's well-known that mutual funds, index funds, and exchange-traded funds (ETFs) are excellent vehicles for achieving portfolio diversification.
These funds invest in a wide variety of equities, bonds, and other assets including real estate and derivatives. Putting your money to work in a number of different markets spreads the risk of a decline in value throughout your portfolio and increases your potential for gain.
The primary mechanism in which exchange-traded funds (ETFs) and mutual funds are acquired by investors is distinctive. They are more liquid than mutual funds since they may be bought and sold on the stock market at any time. Not only is there no required minimum investment, but many brokers will even sell you a single share in fractional increments.
Exchange-traded funds are typically passively managed, with the intention of mimicking the performance of a broader market index. Because they don't need as much human intervention, passive strategies may be less expensive than their actively managed counterparts. However, some ETFs are managed actively in an attempt to outperform a benchmark. Active funds will typically have a higher expense ratio.
Mutual funds and exchange-traded funds both fall under the category of “index funds”, which are designed to passively replicate the performance of a particular market index (such as the S&P 500 or Russell 2000). The index fund may mirror all of the securities in an index, or just a subset, depending on its construction. Passively managed funds, as indicated above, are often less expensive than their active counterparts.
Buying Guide: How to Buy Tesla Stock — News Updates 2023 and 2024 📈
In this section we cover the latest Tesla share price news, Tesla news events, Elon Musk stock news, and more, to give you a sense of what’s happening with Tesla since 2023. Make sure to research elsewhere as this page isn’t always updated up to the minute. 🚀
Are Tesla Shares Overvalued? 💥
Many believe so. Taking into account Tesla's falling market share and comparing the company's stock price to those of other manufacturers reveals a disturbing trend. When compared to competitors, Tesla is very pricey, which is a major concern for Tesla bears.
The price-to-earnings (P/E) ratio for Tesla is approximately 40, whereas that of big manufacturers like Hyundai, Volkswagen Group, and Ford is around 10. You wouldn't buy the most expensive business if it made the same amount of income as three other companies but cost four times as much.
Since Tesla is more than just a car company, the issue is naturally more convoluted. It is necessary to compare Tesla to other automakers since the company still earns the vast bulk of its money from the selling of autos.
Are there Good Reasons to Buy Tesla Shares (in 2023)?
Stock in Tesla (NASDAQ:TSLA) has been overpriced for years, in the view of many. Is the current share price, after falling by 70% in 2022, a fair reflection of the company's value and a good excuse to invest your extra savings?
Many are still unsure in 2023 whether it's the right time to go on the Tesla bandwagon, despite the steep discount. To explain, here's the deal:
Are they an IT firm or in the auto business?
In the previous several years, there have been divergent opinions on Tesla as a business. To start, the electric vehicle manufacturer is a major technology corporation. The second is that when compared to its rivals, Tesla is light-years ahead of the competition in terms of the technology used in its vehicles.
While the difference may be lost on Tesla vehicle customers, this could be a key factor in the company's astronomical market cap.
By 2021, Tesla's market capitalization had risen beyond $1 trillion (£800m), making it more valuable than rival automakers Toyota, Volkswagen, Daimler, BMW, Ford, and General Motors put together. Even if its rivals sold a combined 30 million vehicles in 2020, it was still able to acquire that value with just 500k car sales.
Tesla's stock price has always tracked the movements of technology firms like Apple and Alphabet rather than traditional automakers.
If you were to see Tesla as a technology business, you might understand the high share price in recent years. When seen only as a vehicle manufacturer, though, its valuation appears excessive.
It seems that the stock price of Tesla was driven more by speculation than by fundamental factors like earnings. The company's P/E ratio reached an all-time high of 359 at one point. The price-to-earnings ratio has dropped to a more acceptable 35 today.
How about growing EV rivals?
If you had offered me £90 for a share of Tesla at a P/E of 34 a year or so ago, many would have bought it without hesitation. To be sure, the auto industry isn't the same as it was even a few years ago.
Electric vehicle (EVs) market share has shifted, and Tesla is no longer on top. The day when it was either the greatest EV on the market or the only viable electric choice is over.
When the major manufacturers were late to join the EV market with anything as attractive as what Tesla had to offer, they handed the market over to Tesla.
There are indicators that demand for Tesla cars is beginning to level down now that the EV industry has matured.
The firm supplied around 6% fewer automobiles than anticipated in the fourth quarter of 2022. It's one of the first indicators that Tesla isn't hitting production limits, but rather, demand is falling.
It seems that Musk's firm has succumbed to the rising tide of competition from established manufacturers.
In order for me to invest in Tesla stock right now, you'd need to see that demand is continuing to rise. That's the only way the company's P/E of 35 makes sense, at least in my book. Demand for Teslas is down, but many don't believe they've hit rock bottom yet.
FAQs 📚 How to Buy Tesla Stock
Exactly what New Developments Have Taken Place With Tesla's Cybertruck?
Originally scheduled for release in Q4 2021, Tesla's Cybertruck was delayed until 2022, the firm said. The truck's development has been hindered due to design problems and supply chain difficulties caused by the epidemic. On April 7th, 2022, Musk revealed that production of the Cybertruck will begin in Tesla’s Texas plant in 2023.
What's the Deal with Bitcoin Payments and Tesla?
In Q2 2021, Musk made a Twitter statement on Twitter that Tesla would stop accepting Bitcoin payments for its autos owing to the “rapidly escalating utilisation of fossil fuels” for Bitcoin mining and blockchain operations.
Once more than 50% of mining is done using renewable energy, Musk said that Tesla will once again accept Bitcoin as payment. Musk elaborated that Tesla will start accepting Bitcoin during a 2021 presentation that “at or above 50%” of the energy needed to manufacture Bitcoins is now coming from renewable sources.
What's Happening with Tesla's Cars Radar?
Tesla announced that Model 3s and Model Ys destined for North America will not have radar sensors. As a consequence, the Model 3 has lost its “Top Safety Pick+” designation. But both Consumer Reports and the IIHS confirmed that Tesla Model 3s continue to meet their strictest safety standards.
Where Do Elon Musk and the SEC Stand Now?
The U.S. Securities and Exchange Commission (SEC) reached a settlement with Tesla and Musk, the company's CEO, on a fraud claim in 2018. The settlement of £33 million, which included fines for both Musk and the business, included Musk's agreement to step down as chair of the board and the firm's commitment to corporate governance changes and other modifications.
Tesla CEO Elon Musk revealed his intentions to take the company private in a Twitter post, but the Securities and Exchange Commission said the statements “lacked an acceptable basis in fact”. And the SEC claimed that Tesla “failed to implement proper disclosure controls and procedures related to Musk's tweets”.
The SolarCity Lawsuit: What's the Deal?
How do things currently stand with Tesla shareholders' SolarCity lawsuit?
In 2021, Musk had to testify in a lawsuit by Tesla shareholders. As chair board for the companies, the plaintiffs say he rescued SolarCity in 2016 by having it acquired by Tesla. Plaintiffs' lawyers argued that Musk needed to give back the $11 billion (£9B) in Tesla shares he received in return for his SolarCity stock during the case, which took place in Q1 2022. Last we checked, there has been no ruling on the matter.
Who is Tesla’s CEO?
Elon Musk oversees the daily operations of Tesla. Musk made a significant investment one year after the company's start. He led the company from a negative cash-flow startup to a massive, successful manufacturer and industry leader in electric vehicles. In 2018, he resigned as the company's chairman of the board after reaching an agreement with the SEC. Musk became the company's CEO in October 2008 and has held that position continuously since then.