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How to Buy Electric Vehicle (EV) Stocks

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Between soaring giants like Tesla (NASDAQ: TSLA) to unexpected winners like Blink Charging (NASDAQ: BLNK), the realm of electric vehicles (or “EVs” for short) has plenty of potential picks for investors. 

The electric vehicle industry is currently valued at around $550 billion — and with continued pushes for limiting fossil fuel consumption, it’s possible that the EV market will continue to expand throughout 2021 and beyond.

If you’re interested in investing in EV stocks, the 1st step is to open a brokerage account and familiarize yourself with the current market. Our guide will help you learn more about electric vehicles stocks, and choose where to open an account to place your 1st buy order. 

How to Buy Electric Vehicle Stocks

The 1st step to investing in any type of electric vehicle stock is to open a brokerage account. No matter if you’re buying stocks you plan to hold for years to come or affordable stocks under $20 you think will rise in value, your broker can help facilitate your transactions through buy and sell orders.  

Pick a Brokerage

If you don’t already have a brokerage account, you must create 1 before you start investing. Not sure where to start? Consider starting by browsing a few of the best brokers for beginners below.   

Best For
Intermediate Traders and Investors
Overall Rating
Get started securely through Webull’s website
Best For
Intermediate Traders and Investors
N/A
1 Minute Review

Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.

Webull is widely considered one of the best Robinhood alternatives.

Best For
  • Active traders
  • Intermediate traders
  • Advanced traders
Pros
  • Commission-free trading in over 5,000 different stocks and ETFs
  • No account maintenance fees or software platform fees
  • No charges to open and maintain an account
  • Leverage of 4:1 on margin trades made the same day and leverage of 2:1 on trades held overnight
  • Intuitive trading platform with technical and fundamental analysis tools
Cons
  • Does not support trading in mutual funds, bonds or OTC stocks
Best For
Beginners
Overall Rating
get started securely through Robinhood’s website
Best For
Beginners
N/A
1 Minute Review

Robinhood is the broker for traders who want a simple, easy-to-understand layout without all the bells and whistles other brokers offer. Though its trading options and account types are limited, even an absolute beginner can quickly master Robinhood’s intuitive and streamlined platform. On the other hand, more advanced traders might be frustrated by Robinhood’s lack of technical analysis tools, a feature that’s now nearly universal across other platforms.

Best For
  • Beginner traders
  • Mobile traders
Pros
  • Streamlined, easy-to-understand interface
  • Mobile app with full capabilities
  • Can buy and sell cryptocurrency
Cons
  • Almost no trading analysis tools available
  • Only taxable brokerage accounts available
  • No option to open a retirement account
  • No access to mutual funds, forex or futures trading
  • Limited customer service
Best For
Inexpensive Options Trading
Overall Rating
get started securely through Tradier’s website
Best For
Inexpensive Options Trading
N/A
1 Minute Review

Tradier is a high-tech broker made with the most active traders in mind. Tradier differentiates itself by using Application Programming Interface (API) technology to partner with popular trading software to offer a wide range of platform choices to Investors. Tradier brokerage offers integration with one of the widest ranges of platforms we’ve seen, including Esignal, Orion Multi Trader, Stockstotrade, 1Option, Evati, and many, many more. 

Tradier offers 2 pricing options — infrequent traders may want to opt for Tradier’s 0 Stocks and $0.35 per Options contract trading, while very active traders can often save money by opting into Tradier’s $30 monthly all-inclusive option and Equity, which cuts commissions entirely.

Tradier TradeHawk platform is exceptionally impressive, combining intuitive 1-click order placements with a vast range of indicators and charting tools. TradeHawk is also completely compatible with both Apple and Android mobile devices. Though we’d love to see Tradier expand into mutual funds and offer a bit more in the way of educational tools, the broker remains a top choice for advanced traders and those looking for enhanced customization options.

Best For
  • Very active options traders who would benefit from a flat-rate monthly charge instead of per-contract fees.
  • Advanced traders looking for a customizable broker with a wide range of platforms that can be integrated.
  • Prominent options traders get high-quality execution, real-time market data and subscription trading.
Pros
  • Wide range of integrated platforms provide an option for any trader.
  • All-inclusive per-month subscriptions available in lieu of per-contract commissions can potentially save very active traders hundreds of dollars a month.
  • Platforms are powered by quality real-time market data and execution.
  • Paper trading and Sandbox building mode allows particularly tech-savvy traders to create a platform and strategies customized to their preferences and needs.
  • Exceptionally affordable margin rates.
Cons
  • While good for active traders, newer traders may prefer a platform with fewer integration choices and a more streamlined approach.
  • No online mutual funds currently available.
Best For
IPO Investing
Overall Rating
get started securely through SoFi’s website

Decide How Many Shares You Want

After your account is open and funded, decide how many shares of your stock of choice you’d like to purchase. A good place to begin is by setting a budget and exploring a few popular electric vehicle companies’ current market rates. 

Find a company that you’re interested in investing in, and use its current market price to determine how many shares you want to buy. We recommend that you diversify your portfolio by investing in a few different EV stocks rather than placing all of your money into a single company’s stock. 

Choose Your Order Type

Once you decide how many shares of stock you want to buy, you’ll place an order through your broker’s platform. An order tells your broker which stock you want to buy and how many shares you’re buying. It can also help you specify a price to buy or sell at, as well as limits on when you’d like to buy. 

There are multiple types of orders that you can place — let’s take a look at some common terms you’ll see when you place your 1st order. 

Bid

The bid price is the highest price that a buyer is willing to pay for 1 share of a particular stock. A bid isn’t an order type, but it can help you understand how prices are changing within a stock’s history or the market as a whole.

Ask

The ask price is the lowest price that a seller is willing to accept in exchange for 1 share of stock that they own. Like the bid price, an ask isn’t an individual order type. However, analyzing both the bid and the ask and how they’re changing can help you determine the most advantageous time to buy. 

Spread

The bid-ask spread (sometimes referred to simply as the “spread”) is the difference between the bid price and the ask price. Some stocks under $10 with lower liquidity have large spreads, while stocks with high volumes tend to have low spreads. 

The spread can influence the price you pay for your stock or the price you receive as a seller, so be sure to mind the spread before you place an order. 

Limit Order

A limit order tells your broker that you want to buy a set number of shares of stock at a particular price. For example, if you were purchasing shares of Blink Charging, you might place an order to buy 100 shares at $28 each. 

Your broker will fill the order so long as they can buy shares of Blink Charging for $28 or less. If the price of Blink Charging shares rises above $28, your order will not be filled. This gives you more control over the price that you pay for each share of stock.  

Market Order

A market order tells your broker that you want to buy a select number of shares of stock at the current market rate. When you place a market order, you won’t specify a price that you need your order to be filled at. 

Instead your broker will fill the order as quickly as possible at whatever price the stock is currently trading at. Market orders are more likely to be filled than limit orders, but you might end up paying more per share, as market conditions are constantly changing.   

Stop-Loss Order

A stop-loss order is an order to buy or sell a particular stock once it reaches a certain price threshold. For example, if you purchase 10 shares of Tesla stock at $600 a share, you might set a stop-loss order to sell your shares if the price dips down to $540. This prevents you from losing more than 10% of your initial investment.    

Stop-Limit Order

A stop-limit order combines the features of a stop-loss order and a limit order. For example, imagine that Blink Charging stock is currently trending at $28 a share but has been climbing in price. 

You might set a stop-limit order with a stop price of $30 and a limit price of $35. If Blink Charging stock rises above $30, you broker will begin filling the order. However, if prices rise above $35, the broker will stop executing the order until prices fall again.     

Execute Your Trade

After you’ve placed your order through your brokerage platform, feel free to sit back and relax. Your broker will execute the order on your behalf, and you’ll see your shares in your brokerage account as soon the order is complete. 

If your broker cannot fill your order, they’ll typically cancel it by the end of the trading day unless you specify otherwise. 

Electric Vehicle Stock History

Electric vehicle stocks have a long history on the market. The term “electric vehicle stock” doesn’t refer to a single company. Instead, it refers to the network of vehicle, battery and charging station manufacturers that make up the market.  

The most well-known electric vehicle stock is Tesla, the California-based clean energy company famous for producing electric cars and trucks. Like many electric vehicle stocks, Tesla has seen a surge in interest since the conclusion of the 2020 presidential election. 

It’s possible that this increase in interest is a result of President-elect Joe Biden’s “Build Back Better” climate plan, which calls for a national effort to reduce carbon emissions. Tesla’s stock peaked in early December with a value of $648.79 per share following a stock split. 

Source

Tesla’s stock has been on a sharp rise since the conclusion of the 2020 presidential election.

EV manufacturers are far from the only winners when it comes to the sudden surge in clean driving technology. Another example of a soaring EV stock is Plug Power (NASDAQ: PLUG) which has seen its stock soar in value from $14.00 to $24.44 in just a little more than a month. Plug Power produces hydrogen fuel cells for electric vehicles — another essential component in the growing clean energy sector. 

Pros to Buying Electric Vehicle Stocks

Electric vehicle stocks have surged since the conclusion of the 2020 presidential election. Electric vehicle companies may create nearly 1 million jobs to expand electric vehicle charging stations.

And if clean, American-made electricity includes electric vehicles and related industries, these stocks could continue to climb. The possibility of tax credits and loan options to electric vehicle manufacturers could also encourage another surge in value. 

Cons to Buying Electric Vehicle Stocks

The industry still faces a number of hurdles that impede wider implementation of EV technology. Most electric vehicles require a very large initial investment. Most affordable models in the industry starting at $30,000 or more. 

Until technology advances to the point where EV models are more widely available, consumers can expect to pay between $10,000 and $50,000 more for an electric vehicle than a similar class of gas-powered vehicle.

Charging station availability is also a major factor holding back the industry. Most EVs have limited ranges of 60 to 300 miles per charge. A single long drive can end in a call to AAA if the driver can’t locate a charging port on the road. Charging can also take anywhere from 15 to 20 hours on lower-end models, which is a major drawback when you consider that filling a car with a full tank of gas only takes a few minutes. 

Invest in Clean Energy

No matter if you’re investing in EV stocks to add to your long-term portfolio or you’re searching for stocks under $5 suitable for day trading, it’s important to remember that stocks can decrease in value at any time. 

If you’re interested in the clean energy market, you might want to consider investing in a clean energy ETF (like the iShares Global Clean Energy ETF) instead of individual stocks. An exchange traded fund (ETF) is a “bundle” of stocks that trade in the same way as a single share would, providing you with an instant level of diversification for your portfolio. 

Electric vehicle stocks are worth your review. Take a look at EV stocks, and diversify your portfolio with an investment in clean energy today.

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