What does leverage mean in financial products?

It’s not just real estate that has the leverage effect for good returns, you need to know about the leverage effect in financial products as well.

No investment advice or purchase recommendation!

All information provided here does not constitute investment advice or a recommendation to buy. All statements are my general published opinion. I have obtained the information from my experience as a private investor. This experience report cannot and is not intended to replace personal investment advice from professionals.

For example, I myself lost a lot of money in the beginning because I didn’t notice the X20 at a new broker – tip: take your time for trading – silver plummeted by a few % afterwards.

The collapse of the silver course I have noticed at the edge, thought ok, are only a few hundred euros. Not quite, it was a few hundred euros x 20. That within a few hours.

Risk increases / capital increases

Leverage:

Leverage means increased capital / risk.

Lever quickly explained

For pretty much all products you can use leverage in trading apps and with brokers. Simply put, a short-term loan from the broker. This increases the profits and (!) the risk. You give $1,000, take a leverage of 10, and you have $10,000 of capital tied up.

X10 = from 1.000 you make 10.000

Table: X10, X20 and X30 levers

Examples of levers:

Trading has never been so easy! Buy from 1 euro with these apps:

• Trading apps in test

Trading strategies

Whether it’s cryptocurrency, currency trading, stocks, commodities or precious metals, these 3 strategies will help you understand the basic stock market game. I developed these 3 strategies to help beginners and novices understand the mechanics in a nutshell. Since I grew up with Bitcoin rather than stocks, here in particular a strong reference to digital currencies. However, the mechanisms or strategies are the same for these 5 investment types: cryptocurrency, currency trading, stocks, commodities or precious metals. I would exclude ETF and index funds here, as the risks and price fluctuations are significantly lower here.

• Trading strategies

Share, ETF, Crypto: My experiences / mistakes

Stocks, ETF, Forex, Cryptocurrency, Social Trading – Here’s a little list of a few learnings that cost me money but are so simple you should know them! You want to buy stocks, index funds, cryptocurrency like Bitcoin or Ethereum, foreign exchange (currencies)? You’re thinking whether house bank, direct bank, online broker or app? Trading all on your own at risk or new options like social trading via app? My experiences and mistakes!

• Share, ETF, Crypto: My Experience

NIO vs Tesla: Cars from China

Electromobility is the future. Fossil fuels have had their day. Whether it’s the next 10 years or the next 50 years, the goal is clear: electrification. With the increasing efficiency of renewable energies, the combination of renewable energies and electric automobility is the winner.

Pioneer Tesla: S-E-X-Y, Gigafactories and BitCoin

Tesla is the absolute pioneer when it comes to electric cars. With its models, from the small wagon to the large SUV, Tesla has experienced a great wave of success worldwide. The models, S, 3, X and Y add up to, you get the picture, the word: Sexy.

Apple founder Steve Jobs’ motto fits this:

Stay hungry, stay foolish

Meanwhile, Tesla is building its plants, or giga-factories, around the world. Tesla teaches the fossil giants what the future can look like. The mix of spirit and know-how makes the brand so strong. Tesla was also the first car to go into space, with Musk’s rocket company SpaceX.

Just last week, Tesla got into bitcoin, with over 1.5 billion in volume. The Bitcoin so also soon be accepted as a means of payment.

• Electric car pioneer
• Worldwide expansion
• Further investments in the future

Reason enough to take a look at the electric car mobility market.

Because there are many new players coming to the market in China!

600+ companies from China are coming

There are now over 600 companies in China involved in electric car mobility. “China Cars”, summarized as a claim.

While the Middle Kingdom initially relied on foreign partners such as VW, production now functions independently. The manufacturer NIO in particular is attracting a lot of attention. CEO and Chairman William Li, who can also be seen later in an interview, is currently driving the brand forward worldwide.

What is the difference between NIO and Tesla?

How do NIO and Tesla differ?

Problem 1: Battery charging time

Especially charging the battery is a big problem at the moment. Currently, you have to drive to charging stations and then wait for an hour. For many, such long waiting times are not an option. NIO therefore offers direct battery replacement, in a fast process. This way, owners of electric cars only have to wait a few minutes and a fresh battery is already inserted into the car.

• Tesla: Charge battery by cable (30-90 minutes)
• NIO: Battery exchange at the vehicle (5 minutes)

The concept: battery subscription, instead of purchase. If you extrapolate the daily charging time, quickly a good investment.

15x loading per month:

• Tesla: 450 – 1350 minutes
• NIO: 75 minutes

In fact, direct battery swap is not a new idea from NIO! Tesla already had your direct exchange of batteries in concept in 2015. However, Tesla was way ahead of the curve with that at the time. NIO can now get great PR out of it.

Current solution, charging stations and cables:

Problem 2: Range (power)

The second important aspect is the power of the battery. The more powerful the battery, the further the car or electric scooter or motorcycle can go.

NIO promises a battery range of 1,000 kilometers (for 2022) and attacks Tesla’s Model 3 and Model S directly. NIO seems to have the best technologies at the moment and reports of new top performances are constantly coming in. Currently, there are also plans for an SUV that can cover over 1,000 km on a single charge.

• Tesla Model S: 647 km
• NIO ET7: 1,000 km (Important: Announcement for 2022!)

Future: electric mobility (VW, BMW, Toyota & Co.)

The “giants” also see the trend towards electromobility. In the meantime, of course, the big car companies are following suit, whether VW or Toyota. Electric automobility is on the rise and here you can find charts and price trends summarized once again.

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BMW electric car (presentation Autoshow):

Stocks at a glance: Share price performance 12 months

Here is a comparison, based on the price trend of the last 12 months.

NIO share: Price

NIO is growing 352% in January 2021, year over year. The NIO share is traded on the NYSE (New York):

• WKN: A1CX3T
• ISIN: US88160R1014
• US Symbol: TSLA
• Type: Share

Share price performance (12-month review):

Total since inception:

Tesla share: Price

Tesla stock on the stock market (NASDAQ):

• WKN: A2N4PB
• ISIN: US62914V1061
• US Symbol: NIO
• Type: Share

Share price performance (12-month review):

Entire course, since inception:

China Cars: Shares excerpt

Here are a few more stocks, out of over 600, that have had interesting increases over the last 12 months, similar to NIO.

1. BYD Co Ltd.
2. Great Wall Motor
3. Niu Technologies

BYD Co Ltd. share: Price

• WKN: A0M4W9
• ISIN: CNE100000296
• US Symbol: BYDDF
• Type: Share

Great Wall Motor share: Price

• WKN: A0M4X0
• ISIN: CNE100000338
• US Symbol: GWLLF
• Type: Share

Niu Technologies share: Price

• WKN: A2N7LN
• ISIN: US65481N1000
• US Symbol: NIU
• Type: Share

Videos on the topic

Here are 2 more very interesting videos on the subject, both from Bloomberg.

1. NIO: “Tesla Killer” (Video)
2. Interview with William Li (CEO, video)

NIO: “Tesla Killer” (Video) – Bloomberg

Interview with William Li (CEO) – Bloomberg

Bloomberg Interview (Youtube) – Chinese electric vehicle maker NIO began shipping its new EC6 model last week. The whole thing happened quickly, just about two months after it started taking pre-orders for the battery-powered SUV.

Chairman and CEO William Li discussed demand for the company’s third model in an exclusive interview with Bloomberg’s Tom Mackenzie at the Beijing Auto Show over the weekend. (Removes inaccurate translation of 2Q specific gross margins).