The pandemic hit everyone hard. Except that it didn’t. For some companies, the pandemic was nothing but a business opportunity.
Many businesses saw their revenue dry up and die completely.
Market insecurity, whether caused by quarantine rules or mass death, resulted in many people losing money.
But at the same time, many of the most valuable companies on the planet saw their stock prices do nothing but climb. Tesla is one such business. And the question abounds: How do you buy Tesla shares?
That is a highly simplistic view of things, however.
Buying Tesla shares now is not as valuable as buying Tesla shares two years ago. But just because Tesla shares are not lottery tickets anymore, that does not mean they are without value. So, let’s take a look at what makes them valuable, and when to buy them, as well as where to actually buy the shares.
Table of Contents:
Where Do You Buy Tesla Shares? 🛒️
In order to buy Tesla shares, you have to be able to access the stock market in the first place. The stock market is where publicly traded companies offer up their shares for you to buy, and then sell once they appreciate in value. You can also buy part of a share, and even sell part of a share for partial value of it.
The main way that people buy shares is through trading platforms. These are applications provided by brokers that grant you access to the stock market. To make use of them you have to apply to use them (this process is simple, as long as you have not been convicted of securities fraud in the last few years).
You then have to connect your bank account to them, as shares in a company cannot be bought using a credit card. You have to make direct transfers to the organisations and people you’re buying from.
Once you have an account and get it funded, you can start buying Tesla shares!
Good Examples of Trading Platforms
The best trading platforms are the ones that are the most accessible. Here are some examples.
One of the most accessible due to being on your phone, with an easy interface and crypto access. Just remember that you can only make so many trades per day unless you have enough liquidity.
A platform with a worse interface, but better learning tools and unlimited trades per day.
If you prefer cryptocurrency or European markets, then this is the platform for you. It is also designed with the user experience in mind.
What is Tesla and Why is it Valuable? ➡️
Tesla is, essentially, a technology company. It is a very popular technology company because its brand is focused on being futuristic. The market would expect nothing less—it is named after Nikola Tesla.
Tesla seeks to confront a few fundamental truths about human life on earth. Namely: Eventually, oil will run out. Eventually, every business and human living space will need internet connectivity. Eventually, the demands of human society will outpace humans’ ability to keep up with it. These are facts.
None of these problems are problems for today. The soonest of them are problems for tomorrow. But tomorrow always comes. Which means that Tesla’s future-minded business model will be valuable.
To these ends, Tesla engages in the production of electric cars, internet services, and highly speculative technologies. This means that they are not just researching advancements in the technologies that currently have a place in human society. They are also researching things that may have a place later.
These technologies include artificial intelligence, cybernetics, augmented reality, and even holograms.
When Should You Buy Tesla? 💷️
There are two ways to evaluate when Tesla should be bought: Macro analysis and micro analysis.
Macro Analysis 📊️
Macro analysis is the analysis of market trends through world events. For instance, consider crude oil. There is only so much crude oil in the world. In fact, it has been calculated that at current rates of consumption, there is only about 53 years of crude oil before humans exhaust all oil in the world.
This means that in 53 years, there will be an event that will pretty drastically affect the stock prices of a lot of energies: The extinction of oil. In fact, that event will probably start sooner than 53 years from now. One could argue that it is already starting, though its impact will only get larger over time.
But the specifics are not important. The point is that you can see certain events coming ahead of time and make a reasonable guess as to whether they will make the price of a related company’s shares either rise or fall. You can use this same logic to predict what might happen to Tesla’s stock.
In January of 2020, Tesla’s stock was £88 per share. By the same time the next year, it was £700 per share. What happened in the intervening 12 months? That’s right: The pandemic.
Knowledge of the coronavirus was available before 2020. If you had bought Tesla shares before the lockdowns, then you would have multiplied your investment by ten times within a year.
This is because Tesla is a stock that responds to uncertainty within other markets. When people aren’t driving cars, businesses are closing, and other tumultuous things are happening, that is when Tesla’s stock prices rise the most. They also saw a rise at the beginning of Russian hostilities in Ukraine.
That is macro analysis: Using world events to predict the rise and fall of stock prices.
Micro Analysis 🔎️
All that talk of world events makes buying and selling shares seem like it takes a lot of worldly knowledge. But the truth of the matter is that it is not that complicated. Or rather, it is that complicated, but no one sees the whole picture of what makes a stock rise or fall. All you need to know is that it does.
Micro analysis is the process of looking at the limits of how high stock prices tend to rise, as well as how low stock prices tend to fall. It also includes looking at the amounts that they increase moment to moment to determine what is about to happen in the coming minutes.
After all, you can predict a lot about a stock in the grand scheme of things. But what about predicting where it moves within the space of a day? Or an hour? There is a science to it that can’t be ignored.
To begin with, start by looking at the three-month history of a given stock. In this case, you are looking at Tesla’s share price. There will always be points that are lower than others. Look at the lowest share price of Tesla in the months of January, February, and March of 2022 as an example.
January 27th, February 24th, and March 14th were the lowest points of the share cost for each month. The individual share prices do not matter. The dates do not matter. In a way, the world events around these points do not matter. What matters is that whatever else happened, they did not go lower than this.
From that, you can safely assume that it would take a strong, external force to make Tesla’s share price go lower than the values on those dates. That means if you see Tesla’s stock falling, and it falls to any of the amounts represented in those points, then that is a good time to buy a share. It won’t go much lower.
This is called the “demand line”. This is the base amount of demand that exists for the services Tesla provides. But what about the highest points of their share price? The same analysis applies there too.
The highest points per month were January 3rd, February 9th, and March 18th. There is more variance in the exact values, with the price on January 3rd being an outlier in how high it is. But regardless, the same principle can be employed: It is unlikely to exceed the price represented in those dates.
That means you can sell your shares in Tesla on those dates to make a profit. You can also wait until those kinds of dates roll around to sell the profits from your shares to make dividends off of it.
This is called the “supply line”. This line represents the most supply Tesla is able to provide to meet the demand for their services. As they satisfy supply, their share price rises. Then, once they reach their limit, their share price drops. Sometimes it drops back down to the demand line, but not always.
That is the where, why, and when to buy Tesla shares.
All of that basically amounts to “how” to buy Tesla shares. Just remember to trade responsibly.
Because of its runaway success on the stock market, it is easy to view companies like Tesla as lottery tickets. And indeed, some people will get extremely lucky. But you are better off trading safely than trying to win big.