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How to buy
For those who live in Australia, a great way to invest in Xiaomi shares is, without any doubt, this popular broker.
eToro*, one of the main brokers around the world, is registered and licensed, among others, by the Australian Securities and Investments Commission (ASIC).
We recommend eToro because you can create an account for free with this broker, and its fees for trading online are very low. Besides, eToro is available in our language, accepts users from Australia, it is really easy to manage, and its friendly interface is ideal for those who are starting to trade with cryptocurrencies and stocks.
How to sign up, step by step
The first thing you need to do is click here and fill in the fields on the right: enter your name, email, and set a password.
Then check your email: you should have received an email from eToro, click on the link and your account will be verified.
Once on eToro, you just have to click on “Deposit funds”, in the page menu.
There, you can choose how much money you want to add to your account (the minimum is $ 200) and the payment method:
As you can see in the image, the first deposit can be made by credit card, PayPal, or bank transfer.
How to make your first trade
When eToro has confirmed the receipt of your credit, you just have to search for “Xiaomi” in the search bar, click on “Invest” and choose the amount in dollars you want to invest.
*67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money
Cryptoassets are highly volatile unregulated investment products. No EU investor protection. Your capital is at risk.
Should I invest in Xiaomi?
Xiaomi Corporation is a company of Chinese origin in the technology sector that manufactures and markets electronic equipment, the best known being its smartphones. But what really makes Xiaomi famous is the “value for money”, being Xiaomi itself that defines itself as “a global company that manufactures quality products at honest prices”.
It was founded in 2010 by Lei Jun and Lin Bin, with 2011 being the year when they launched their first smartphone in the Chinese market. This was the first big step of the company that from that moment on would have a history full of successes. And perhaps the first milestone was in 2013 when it surpassed Samsung and Apple in sales for the first time in China.
And since then, the company's commercial success internationally has been an outright affront to other smartphone manufacturing companies. Especially as Xiaomi's market share grows year after year, snatching space from Samsung and Apple.
The Xiaomi model
On several occasions, one of Xiaomi's founders (Lei Jun) has stated that the company prices smartphones only slightly above the manufacturing cost price. And it does this without sacrificing the quality of the components, offering a high quality product at low prices compared to other brands.
And this translates into a volumetric sales strategy, i.e., offering quality at a low price to sell more and thus make a good profit. This model, although it may seem simple and trite, has worked so well that its market share is growing by 16% annually. In the European market, this growth has reached more than 50%.
Despite this, and the fact that more than 90% of its revenue comes from the sale of mobile devices, the company continues to categorize itself as a software and internet company. This has generated criticism of Xiaomi from Samsung and Apple for “not generating innovation” in any area.
Depending on who looks at it, the latter may or may not be true. But what is absolutely clear is that Xiaomi offers equipment with the same features of high-end equipment from other brands at a price up to more than 3 times lower, which has guaranteed its commercial success.
Finally, Xiaomi does not use traditional advertising media and focuses on social networks. In addition to building customer loyalty so that they are the spokespersons of the brand. Very similar to what other brands do, isn't it?
The fact is that, regardless of the criticism, Xiaomi is an established company with a business model that has given it such strength that it is practically impossible for Xiaomi to disappear in the future.
Some of its advantages are:
- It uses techniques and moves from successful traders so you can emulate them
- Admits “shorting” or short-selling
- It's straightforward and manageable
- You can trade leveraged
- It is possible to make investments in thousands of other goods
Go to the official page: www.etoro.com *
In case you are considering it, eToro is the best option to buy Xiaomi shares from Australia.
This broker is popular for making “social trading” fashionable. Social trading is a revolutionary form of investing in which traders can repeat the moves of other investors who have been making profits for a long time.
eToro has solutions for you, even if you are still a novice user in trading. You can rest assured that you will be doing a smart investment move when replicating those from subjects with a long profit record. Also, in case you are an investor, the platform pays for your knowledge.
It is also very convenient how accessible is the platform, excellent for beginners who are starting in the investment world.
What are the instruments you can trade in eToro?
You already know about stocks, there are a few more financial instruments available.
About Index Funds
In case you want to invest in the long term, and you won't need to take back your money in at least five years, index funds can be the best alternative. This type of investment is also suitable for beginners since the risks are much lower.
You may think differently, but benchmark returns are very difficult to beat and very few fund managers achieve that, apart from some specific cases, like Warren Buffett's.
If someone brags about having beaten the benchmark, they probably did it for a short time or on particular occasions, or perhaps the charges are so high that indexing would be a better decision anyway (with minimal commissions).
Index funds offer these two great advantages: they usually beat active managers in the long term, and the charges are minimal.
Exchange-Traded Funds or ETFs are similar to index funds. They can be described as a combination of stocks and mutual funds, including the best features of both. They are traded in the market like stocks, during the day. However, their main benefit is that they offer more alternatives compared to stocks, and have lower fees.
Most people invest in raw materials because of their stability. While other assets tend to fluctuate more, raw materials prices vary less and offer safety against inflation or market volatility. Nevertheless, prices are subject to supply and demand in the market, so if the fear of possible inflation provokes greater demand for a certain good, its cost will also go up.
Note that the only intended profit from the investment in raw materials will be the hypothetical capital gain after selling them: unlike stocks, these don't distribute dividends or pay interest.
There are two basic kinds of commodities: hard raw materials and soft raw materials. The former are precious metals (such as gold, silver, copper, and platinum), industrial metals (for instance, aluminum, iron, or zinc), and oil; and the latter are agricultural resources, such as sugar, coffee, corn, soy.
Forex or currency trading is the exchange between a pair of currencies.
If you decide to trade the EUR/USD pair, for instance, you speculate how many dollars it will take to buy a euro, with the expectation that after buying the first currency (the euro) it will increase compared to the second (the dollar), to make a profit by selling it. Let's say you entered when a euro is worth 1.10 USD and you exit when the price has gone up to 1.15: that difference is yours once you sell again.
As you may have deduced, trading with currencies usually implies a large capital, since fluctuations are normally low, or using much leverage, which is always a risk. If you are a novice in trading, it is not a good idea to begin with Forex, because it is very risky and intricate.
You can exchange with almost every currency on eToro. Still, consider that in this market sales are always made through CFDs, therefore the underlying asset won't be yours.
Payment methods on eToro
Among the payment methods available on eToro are: bank transfer, PayPal, credit card, Neteller, and Skrill. There is not much to say here: making a deposit with eToro is a very easy process. Just go to “Deposit funds”, choose an amount and the payment method you prefer.
Consider that for security reasons, you must be the owner of the account or the credit card.
The minimum amount you can deposit is $ 200 and there is a limited amount if you are not verified, so if you want to trade with larger sums, contact Support previously to verify your account.
The platform allows transfers in any currency, but charges a fee for making the conversion to USD. That is why we suggest, if it is in your hands, using USD directly.
What is social trading?
eToro was the first platform that proposed social trading, and this new concept became very successful. Lots of other brokers copied this idea, but eToro is still the best.
The merit of the platform is that they did not limit themselves to transferring the logic of the social network to the trading world. There are already countless sites to discuss investing, but they wanted to go further: the major contribution of eToro was to allow users to replicate the strategies of experienced traders, and to reward them latter for their knowledge.
It sounds complicated but it isn't: when you access eToro you will see in the menu on the left the options “Copy People” and “Invest in CopyPortfolios”.
“CopyPortfolios” are a kind of portfolio that bundles a number of financial assets in a certain sector. For instance, if you anticipate that a particular sector will have significant profits but you don't know which stocks to invest in, you just have to choose a portfolio that includes a variety of related companies in that industry.
At the time of writing this article, this CopyPortfolio has generated a 100% return in the last twelve months, and you just need to click on “Invest”, enter the amount, place the stop-loss and wait.
But you can also copy other users of the platform who are successful investors. With “Copy People” you can find them and imitate their investments easily.
In the profile of each user, you will see their risk profile (how much risk do they take when trading), their performance history, and what type of financial instruments they trade: currencies, forex, commodities, stocks….
Copying strategies from others can be very interesting and helpful, but it is also a good idea to take advantage of the platform's community to read other users and learn from their experience. If you aim to end up living from trading, it is a great place to absorb a lot of knowledge.
You can trade cryptocurrencies using several methods: for instance, you can buy and hold, or you can day trade (and benefit from market volatility).
My suggestion for those who are starting to trade is going for a middle point: placing a dynamic stop-loss (15-20% under the highest price) when you open your trade and wait for it to work on its own.
Therefore, if for example you purchase a cryptocurrency at $ 10, it reaches $ 20, and after that it decreases to $ 12, your stop loss will close your position at $ 16-17 and you will have earned a considerable profit.
You may be wondering: why not selling back when the cost is at its highest? But that would only work for a psychic or a fortune-teller. The mentioned strategy is completely realistic and can work out perfectly if it is well applied.
Sooner or later, you will be prepared for using advanced trading techniques, such as using leverage or going short.
How does a demo account work?
Are you beginning in trading? Using a demo account can be very helpful. Just assure yourself that the virtual mode is set in the top left corner of the page and you can start practicing with an “imaginary” amount.
A virtual account can be a good way of gaining confidence before starting to trade with real money. When you create your demo account, you will begin with a virtual amount of $ 100.000, to trade with a variety of financial instruments available on the platform (not only with Xiaomi).
The first attempt is not usually that good. But don't worry, since you can ask support to deposit back the virtual $ 100k to your account.
Keep in mind that you should always be prudent when trading, and perhaps using a demo account can make you a bit impulsive. It is not the same to trade with your own money than with virtual funds, which you can lose without a problem.
And of course, if you are going to invest in the medium or long-term, with profits almost assured just by duplicating a strategy, it is absurd that you waste years investing with a virtual account. On the contrary, you may be interested in the virtual mode if you want to experiment with short and medium-term operations.
* Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Disclaimer: 67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.