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How to buy
If you live in Kenya, the best way to invest in NIO shares is, definitely, this popular broker.
eToro*, one of the main brokers around the world, is registered and licensed, among others, by the Cyprus Securities and Exchange Commission, and therefore complies with all the regulations of the European Union, the most demanding in the world.
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 Kenya, 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 “Verify my email” 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.
If you have a choice, we do not recommend bank transfer because it takes longer, and it can be very frustrating to see the price of NIO rising while you wait for your transfer to be done.
How to make your first purchase
As soon as eToro has confirmed the receipt of your credit, you just have to search for “NIO” 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 NIO?
NIO is a company founded in China by entrepreneur William Li in 2014 that manufactures and markets high-end electric vehicles. At the time of its launch, this company caught the attention of other large companies that decided to invest in NIO and back it. Among them we can mention Lenovo, Tencent, and large investors such as Sequoia Capital.
Since its founding, NIO has grown so much that it currently has offices in Germany, the United States and the United Kingdom. But one of the most remarkable events was the IPO of its shares on the New York Stock Exchange in 2018, where the value of its shares has revalued up to 500%.
This company seeks to lead the way in the transition from internal combustion vehicles to electric vehicles, thus declaring war on Tesla. This has caused the existence of NIO to be framed within the confrontation between the United States and China.
But it should be clarified that NIO is not the only Chinese company producing electric vehicles. And although its goal is to produce intelligent electric vehicles and autonomous driving, it also has ideas that completely differentiate it from Tesla and the other companies competing in this sector.
What makes NIO stand out from its competitors?
NIO offers high-performance electric vehicles that have a range of more than 600 km. But this is something we can find in other electric vehicles from the Tesla brand.
What does set NIO apart is its charging systems, as the charge can be brought to wherever the vehicle is located. It does this with a van that is capable of providing charging for a range of 100km to two vehicles, and can also recharge Tesla vehicles. So, if a Tesla user does not have a Supercharger nearby, they can call NIO.
In addition, a recharging system that completely sets it apart from the rest is battery swapping. NIO has battery recharging stations where the discharged battery is replaced by a fully charged battery.
All this is done automatically and controlled by robots that carry out the whole process in less than three minutes. So NIO owners really care little or nothing about charging time, thus raising the company's service to a new level.
This service works on a subscription basis that users pay monthly and gives them access to the service. With the advantage of making vehicles cheaper by more than 8 thousand dollars, since users do not have to buy the battery but only subscribe to the service.
Small differences in the business model that in the future could tilt the balance towards NIO's side, making it a company that should always be taken into account.
About Contracts for Difference
You probably have seen the acronym CFD more than once if you already registered on eToro. Before we explain this further, we must say that cryptocurrency operations on eToro are only CFDs when you go short.
We will also explain concepts like short-selling and leverage, in case you are thinking about day trading cryptocurrency or more advanced practices.
eToro allows you not only to bet “in the black”, but through CFDs you can also bet “in negative”. Let's say that you have the conviction that the NIO will fall, so perhaps it is obvious to think “if it is going to depreciate, I simply refrain from getting in and I'll go in when it has gone down”. However, if you really think that it's going down, why not making some profits?
The practice known as “going short” will allow you to do that. It functions, roughly, like this:
- You obtain from a loan 100 units of NIO, valued at a total of $ 5,000 (these are completely imaginary numbers)
- Next, you sell them at their market price, $ 5,000
- The NIO devaluates from $ 50 to $ 30
- You purchase all 100 units once again, but at the current price, $ 3,000
- You return the 100 units to whom made the loan
- You will have made $ 2000, since you keep the difference
It is far more simple than it may seem. Just keep in mind that by trading in NIO on eToro, with CFDs you can make money if you anticipate downs in the price.
Differences between futures and CFDs
Here is a brief comparison between Futures and CFDs, in case you want to know more:
- Which are the counterparties? In the case of Futures, the counterparty is another investor. In CDFs, it’s the brokerage, in this case eToro
- When do they expire? Futures have a determined expiration, while CFDs don’t have expiration date
- Variety of options: The market for Futures is narrower. With CFDs you can trade in several different markets.
- Minimum deposit amount or “trade size”: Costs for Futures are higher than costs for CFDs.
- Leverage: with Futures, it isn’t possible; while with CFDs it is.
What are the instruments you can trade in eToro?
You already know about cryptostocks, there are other financial instruments available in this broker.
The major advantage of investing in raw materials is that their price fluctuates less than that of other assets. Actually, their intrinsic stability is what makes most people choose raw materials when facing economic adversities or fears of inflation. Even so, the prices of commodities are defined by their demand. Therefore, if a generalized fear of inflation provokes higher demand, the prices will also be higher.
Note that, unlike shares, raw materials don't pay dividends. Therefore, the only potential further earnings would come from a future sale of the asset.
Commodities can be divided into two main types: hard raw materials and soft raw materials. The former are precious metals (such as gold, silver, copper, and platinum), industrial metals (like aluminum, iron, or zinc), and oil; and the latter are agricultural products as sugar, coffee, corn, soy, among many others.
Exchange-Traded Funds or ETFs are similar to index funds. They can be described as a merge between stocks and mutual funds. They can be traded like regular stocks, but include a wide diversity of assets and have lower fees.
About Index Funds
This is the best option for people who can invest in the long term, mostly for beginners, because it is less expensive, diversified, and safer.
Contrary to common perception, it is very hard to beat the market (although you have probably heard of investors who achieve huge profits).
But besides Warren Buffett and a couple more, not everything is as good as it sounds: if you hear of someone who has beaten the benchmark, they have probably done so for a short period, or charges so many commissions that it ends up being better for you to index (whit minimal commissions). Also, past performances do not ensure a future one.
The great advantage of index funds is that they perfectly solve both issues: their fees are insignificant and in the long term they tend to beat active managers.
Forex or currency trading is the exchange between two currencies.
For example, in case you want to exchange EUR and USD, you speculate how many dollars it will take to buy a euro, thinking that the first currency (the euro) will revalue compared to the second (the dollar), to make a profit by selling it. Let's say you entered when the price of one euro is 1.10 USD and you exit when it reaches 1.15: that difference is yours once you make the operation.
Perhaps you already inferred this, but trading with foreign exchange requires investing a lot, because prices never increase that much, or using much leverage, which you know is a risk. If you are just starting in trading, it is not a good idea to begin with the currency market, because it is very risky and intricate.
You can exchange with almost every currency on eToro but consider that Forex trading functions with CFDs, thus you won't own the underlying asset.
When trading cryptocurrencies, there are different possible methods or strategies, such as day trading or buying and holding, for naming just a couple.
My suggestion for those who are beginning to trade is something in the middle: when you open your position, place a dynamic stop loss 15-20% below the highest price, and forget about the operation.
This means that if, for example, you buy a cryptocurrency at $ 10, it reaches $ 20 and then falls to $ 12, your stop loss will take you out of the trade at $ 16-17 and you will have made a decent profit.
You may be wondering: why not selling when the cost is at its highest? But unless you are a psychic, that is just not possible. The mentioned strategy can work perfectly and give good results.
Later on, you will be able to apply more sophisticated techniques, like short-selling or using leverage.
How does a virtual account work?
In case you do not have much experience as an investor, you can start by practicing with a “demo” option. Setting a virtual account and trading with fictional funds is very easy.
This is a great tool for those who are new to this world and want to put their talents to the test before playing for real funds. When you create your account, you will start with $ 100,000 of virtual balance to do all the operations that you can think of: not just with NIO, you can also work with a diverse portfolio.
The first attempt is not usually that good. But don't worry, because you can ask eToro to deposit back the virtual $ 100k to your account, and the second time you should do better.
Take into account that investing is mostly about being cold-minded, and using a virtual account might have the opposite effect. It will never be the same as risking your own money.
As you may suppose, if you are interested in trading in the long or medium-term, it makes no sense that you try the virtual mode and waste years waiting to see the results. On the other hand, it can be ideal if you want to practice short and medium-term trading.
“Social trading”, an innovative concept
The first platform that thought of trading as a social activity was eToro, and the idea became successful really quick. Other brokers have also adopted this concept, but eToro is way better.
But it wasn't just about creating yet another social network to talk about investment. The real achievement was in the possibility for users to copy the strategies of advanced investors, who were in turn paid for their ideas.
When you enter eToro you will find in the menu on the left the options “Copy People” and “Invest in CopyPortfolios”.
“CopyPortfolios” contain a collection of assets of the same sector. For example, if you consider that a particular sector will have significant profits but you are not sure which investments to make, you just have to select a portfolio that groups together a variety of related companies in that industry.
At the time of writing this text, this CopyPortfolio has generated a 100% profit in the last twelve months, and the only thing you have to do to benefit from it is to click on “Invest”, enter the amount, place the stop-loss, and the rest will be done practically on its own.
But you can also copy other users of the platform who are successful investors. It is really easy: you can find them with “Copy People” and just replicate their strategies.
In the profile of each user, you will see their risk profile (how much risk do they take when trading), their performance, and what type of financial instruments they trade: shares, forex, cryptocurrencies, raw materials….
Besides copying other investor's strategies, which is really interesting and helpful, we also suggest that you make the most out of the community by reading other user's comments. You can learn a lot from their experiences and knowledge, mainly if your goal is to make a living from trading.
* 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.