How to Buy Tesla Stock – Pay No Fees
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Even if you don't have up-to-the-minute information on electric cars, you have likely heard of Elon Musk, the CEO of Tesla. In 2021, Musk was the "Richest Man in the World," and investors were keen to follow his every move.
In 2020, Tesla's stocks became the talk of the town, surging higher and higher as the company (and Musk) continued to make news. The S&P Dow Jones Indices added Tesla to its S&P 500 by the end of 2020. The stock hit its all-time high of $883.09 on January 26, 2021.
As of May 6, 2024, Tesla's price is $181.19 a share. (It went for a stock split in 2022.) Want to get your hands on shares of this hot stock? I'll take you through the process.
In this article
Step 1: Finding a broker that offers Tesla Stock
Since Tesla is publicly traded, the stock is available to anyone who purchases equity. There are several ways to buy Tesla Stock, but the easiest and the most convenient is through a brokerage account. Different brokers have account minimums, trading commissions, and the stocks they can sell, and there are several online brokerage platforms that you can buy and sell from your laptop or mobile device. Weigh your options before making a decision. It is also possible to purchase fractional equity shares if you do not have enough funds to handle the steep costs. Here are a couple of online platforms that can help.
Stash
Stash aims to make investing easy and quick for you. It caters to first-time investors looking to enter the world of investing and who do not have a huge amount of capital. The app has a beginner-friendly approach, allowing you to invest in thousands of stocks. Stash is a paid service that starts at $3 per month and goes up to $9 monthly.
There is no opening deposit required for Stash, and with the growth account, you also get a retirement account at $3 per month. Further, there is Stash+, available at $9 per month, and you get an investment account for two children, among other things.
You can also purchase fractional shares with Stash, which can be handy when purchasing Tesla stock. If you can't afford the current share price of over $150, use what you can in a fund that pools with other members to make the stock more affordable.
Pros and cons
Pros
- No minimum deposit to open an account
- Fractional shares of stocks sold
- Minimum monthly fees, starting as low as $3
- A stock-back debit card that provides an online bank account
Cons
- The app is based on your goals and not on buying individual stocks
Robinhood
Robinhood is a free trading platform where you can buy Tesla stock on Apple iOS or Android phones or anywhere else online.
Open an account without a minimum deposit, and a Robinhood Cash account allows zero-commission trades. However, it doesn’t include instant deposits or instant settlements. You'll need a Robinhood Gold for that, at $5 per month.
Robinhood is known for selling fractional shares. On Robinhood, fractional shares can be as small as 1/1,000,000. Trading of fractional shares is done in real time and is commission-free.
Pros and cons
Pros
- No commitments
- No monthly fees
- No minimum account balances
- Fractional shares of stocks available
Cons
- Limited investment products offered as some competitors
- Difficult to reach customer support
Step 2: Research Tesla shares
Tesla Inc. is a car company founded in 2003 in San Carlos, California. The company was named after the inventor Nikola Tesla, who made great electric strides during the 19th century. The company designs, manufactures and sells electric cars and was initially named Tesla Motors.
It was founded by engineers Marc Tarpenning and Martin Eberhard, who served as CEO and CFO, respectively. Elon Musk joined the company in 2004, investing $30 million and becoming the board chairman. When Tarpenning and Eberhard left the company—claiming it was forcibly—Musk became the CEO.
Today, Tesla is one of the top companies in the EV market worldwide. The company operates two main segments: energy generation and storage and automotive. The energy generation and storage segment sells renewable energy, solar systems, and energy storage products, while the automotive segment focuses on electric vehicles and EV powertrain components.
Tesla Inc. is listed on NASDAQ and debuted as a public company on Jun. 29, 2010. The IPO price was $17 a share, and it raised $226 million in the IPO. In 2010, the stock was as low as $3.84. It didn't hit triple digits until 2020. Since then, Tesla has seen high market volatility.
In August 2020, it conducted a five-for-one stock split, which dropped the share price to below $400 compared to the price of $2,200 per share before the split. Further, in August 2022, it conducted another stock split at 3 for 1 when the stock was trading at $890, and it went to $288 after the split.
The company is changing hands at $181.19 as of May 6, 2024.
Related: How to Know When to Sell
Tesla price history
Investing in an IPO is an opportunity to make the most of the growth, and Tesla is no exception. The company has grown tremendously over the years. If you had invested $1,000 in Tesla in the IPO in 2010, you would have received 58 shares, and your investment would be worth $36,830 without the stock split. But the company announced a five-for-one split, so you would hold 232 shares worth a whopping $151,711 in 2020, and after the 2022 split, you would have 464 shares worth $84,072 today.
Tesla dividend information
Tesla has not paid a cash dividend at any point. A lot of what it earns goes into R&D.
Best features of Tesla stock
If you could not buy Tesla stock in the IPO or over the last few years, you can still buy it and make the most of the growth opportunity.
The company has seen a slump since the beginning of 2024 and hasn't been able to deliver on expectations. Its delivery numbers and profit have dropped in the first quarter, but there is high optimism around the EV giant's future. It plans to start making new electric vehicles next year and launch a mass-market model.
Another reason to believe in Tesla is the competitive edge it enjoys. Despite many EV companies in the market, including General Motors and Ford, Tesla maintains a stronghold. It offers features and technology that no other companies do. The EV industry is only going to expand in the coming years.
The EV market is projected to grow from $287.36 billion in 2021 to $1,318.22 billion by 2028. There is government support for EV manufacturers like Tesla and Nio as economies move towards a greener future. Countries welcome self-driving cars, and considering the current technological and environmental state, the industry will expand over the next five years.
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Step 3: Open an account & buy Tesla shares
If you want to buy Tesla shares, you need to open an online brokerage account and dip your toe in the financial world. I'll use Stash to show you how. You can open an account on Stash without depositing any money, and the process is simple and straightforward.
Decide the amount of money you want to invest and head to the Stash website. There, you can explore the website, learn more about stocks and ETFs, and search for individual stocks.
On the homepage, click on “Get started.” Then, provide the email address and password to create an account. This process will take less than 5 minutes.
You now need to provide personal information so that Stash can identify the types of investments you are looking for.
Provide your name, citizenship status, birthdate, address, phone number, investment purpose, and estimated pre-tax household income.
Once this is done, you will be asked to pick a plan. You can choose from one of the three plans and choose a payment method.
Once you have signed up, you can decide on the number of shares you want to buy. You can use the ticker symbol of Tesla (TSLA) to place an order. You can then choose between a market or limit order. In a market order, you can purchase at the current stock price, and in a limit order, you decide the maximum or minimum price at which you want to own the stock. You can also buy fractional shares.
FAQs
How much were Tesla shares when the company first went public?
Tesla stock was priced at $17 when it first went public in 2010 through an IPO.
How much does it cost to buy Tesla shares today?
As of closing on May 6, 2024 Tesla shares cost $181.19.
Does Tesla pay dividends?
Tesla does not pay any dividends.
What is the minimum number of Tesla shares that I can buy?
You can purchase one share or a fractional share if you use the right brokerage.
The bottom line
Before purchasing Tesla stock, it is important to assess your financial situation and understand your long-term investment goals. All stocks are susceptible to volatility. Due to the surge in the company’s stock, CEO Elon Musk has become the richest person in the world, and based on the market data, investors continue to believe that Tesla's stock could be worth a lot more.
If you haven’t been able to keep away from following the success story of Tesla and other growth stocks and it has grabbed your attention over the last year, you may be keen on buying Tesla stock. The stock has grown faster than ever, and you can get some action, even with a few dollars.
Using online brokerage accounts like Stash, Robinhood, or Wealthfront, you can go ahead and enter the world of the stock market. You can also purchase fractional shares through Stash if you do not have hundreds of dollars to own one share. Remember that you will win some and lose some. The stock market is known for volatility; you should be willing to take risks. Buying a stock at a high valuation comes with risks, and you must consider your risk tolerance and investment portfolio before moving.
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Editor
Vandita Jadeja is a financial writer and editor at Joywallet. She loves to read and write about money and brings a decade of experience from the financial industry.
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