How can you buy BMW shares?
BMW is the abbreviation of Bayerische Motoren Werke AG. This multinational produces and sells motorcycles and cars. The company is one of the largest car producers in the world. BMW produces cars that are in a more expensive price range. Mini and Rolls-Royce are other brands owned by BMW. The headquarters of the company is located in Munich. In our extensive analysis you can read if it is interesting to buy BMW shares. We also explain the best methods you can apply to invest in BMW.
The car brand BMW is well known and sought after worldwide. It can be interesting to add shares of BMW to your stock portfolio. When the company is performing well, you can achieve a good return. A strong party where you can buy BMW shares is eToro. At eToro you do not pay set commissions, which gives you more opportunities to achieve a positive result. Use the button below to open an account with eToro:Your capital is at risk. Other fees apply. For more information, visit etoro.com/trading/fees.
How can you actively invest in BMW?
BMW’s share price can fluctuate sharply in the short term due to positive and negative news. In the past, for example, certain models had to be recalled due to a defect. This can put pressure on the share price. When you buy the shares for the long term, you can make a loss with your investment in BMW when the price goes down. By actively trading, you can benefit from these kinds of movements.
You do this by using a CFD. With a CFD you can take advantage of the smallest price movements. You can apply leverage so that a small movement can still yield a return of ten percent. A good party where you can trade CFD’s on BMW is Plus500. You can try out the possibilities at Plus500 without any risk with a demo. Use the button below to open a free demo at PIus500:72% of retail CFD accounts lose money.
Are you curious about the share price of BMW? In the graph you can directly see the CFD price of the BMW stock. With the buttons you immediately open a position on the stock.
Why can investing in BMW be attractive?
Investing in BMW can be advantageous. One good reason to invest in the company is its strong reputation. In 2012, the company even won the award for the most internationally renowned company. People often buy a car that matches their identity. A popular brand name is therefore essential for future sales and the potential success of the company.
Another strong point is the fact that BMW recognizes that social entrepreneurship is becoming increasingly important. Cars pollute and people who care about the environment put more emphasis on clean cars. BMW is trying to implement improvements that reduce the emissions of the cars. For example, they are working on new, ecological fuels. An example of this are cars that run on hydrogen. At the time of writing, BMW has already launched more than 20 models on the market that are less polluting. Are you an investor who values the environment? Then you can certainly consider investing in BMW.
BMW is also doing well in terms of quality. Consumers find it increasingly important that the products they buy are of high quality. The factories they use in America meet the highest standards to guarantee this quality. They also invest a lot of money in high-quality personnel. Of course, there is also a downside to this quality: BMW cars are expensive.
BMW can further benefit from the various innovations. They look into the development of autonomous, self-propelled vehicles. BMW puts a lot of money into the development of new techniques. The company will benefit from this in the future which can make the share price even rise further in the future.
BMW has built up a reputation as a high-quality car brand. They are very service oriented. Because they also have a large market reach in China, there is still enough room for growth. All these factors can make an investment in BMW interesting.
Investing in BMW is of course not without risks. It is important to consider the risks before you decide to buy BMW shares. The high-cost structure is a risk for BMW. As a result, production costs are higher and BMW cannot compete on price. As long as there are enough people who like to buy an expensive car, this does not have to be a problem. Still, in economically bad times it can lower the sales figures.
The company also has little variation in the area of brands. BMW owns BMW, MINI and Rolls-Royce. With these brands, they can only serve a limited market segment. This makes the company more sensitive to negative developments in a certain customer segment.
Another risk is future increases in fuel prices. When it becomes (too) expensive to drive a car, more people will look for alternatives. At the same time, rising raw material prices can cause costs for BMW to increase. It is therefore important to keep a close eye on oil and raw material prices when you consider an investment in BMW.
It is also important to keep a close eye on the competition. Especially in the Western world, the market is quite saturated. People often already have their favourite brand, and it is difficult to change their mind. Growing in these markets is therefore difficult. That’s why it is wise to compare how BMW is performing in comparison to other car brands.
Exchange rates can also be a risk when you invest in BMW. BMW is a German company and uses the euro. Fluctuations of the euro against other currencies can strongly influence the results.
There are also sometimes technical defects that require a major recall. This type of recall can further reduce profits. This can put further pressure on the share price. Before you buy BMW shares, it is therefore important to take these underlying forces into account.
To buy BMW shares you have to go through 4 steps. We cover these steps here, so you know what to do when you want to invest in the well-known car company.
Step 1: come up with a strategy
First you will have to draw up a strategy. Determine at what price it is attractive to buy BMW shares. You can use technical or fundamental analysis to determine when it is interesting to get involved.
Always base your investments on a plan. By using a plan, you prevent your emotions from gaining the upper hand and steering your investment decisions.
Step 2: open an account with a broker
A broker is a party that makes it possible to buy & sell shares. You must choose a fast & relatively inexpensive broker. Many people forget to look at the costs and therefore achieve a lower return. Are you curious what the best broker is? Take a look at our brokers overview and discover the best parties to invest in stocks:
Step 3: place an order
After you have decided how and where you want to buy the stock, you still have to place an order. For long-term investors you can use a market order. You then buy the stock directly at the best available price. For the active trader it can sometimes be smart to use a limit order. With a limit order, you open the position as soon as the stock reaches a certain price. This gives you full control over your investment strategy.
Step 4: Evaluate your investment
It is important to evaluate your investment regularly. Check whether it still makes sense to hold on to your investment. By using a stop loss, you can automatically close the position if the loss increases too much. As a long-term investor, it is often better to wait for recovery.
Franz Josef Pop founded BMW in 1916. He received the right to make aircraft engines. After the First World War, the production of aircraft engines was banned. The company ceased its activities. In 1922 the company revived. The company decided to make motorcycles and cars. In 1923 the first motorcycle, the R32, appeared on the market. From 1933 onwards cars were also produced.
During the Second World War, BMW engines, motorcycles and all kinds of vehicles were made for the German army. The factories of BMW were largely destroyed by bombardments. The sporty sedans and coupes that the company built after the war were very popular. BMW managed to bring many successful models to the market in the years that followed. The company grew into a leading car manufacturer.
A large car manufacturer
The annual production figures show that BMW is a major car manufacturer. In 2014, the company managed to produce and sell over 2 million vehicles. In 2018, the company produced a total of 2.5 million vehicles. At that time, BMW sold 4,107 Rolls-Royce cars, 360,000 Minis and 2.1 million BMWs. A total of 142,600 electric cars were built in that year.
Production and markets
Where are the cars of BMW manufactured? In Germany, America, China and the Netherlands. In 2018, 360,000 cars were manufactured in Spartanburg, USA. A joint venture in China produced 500,000 cars. Approximately 212,000 cars rolled off the conveyor belt at VOL Nedcar in Born.
What was the largest market in 2018? The People’s Republic of China. A quarter of all cars are sold there. In second place is the United States. Germany ranks third. Together, these markets account for half of all cars sold by BMW.
- Opened in 1994, the BMW Manufacturing Company Sparrenburg was BMW’s first U.S. assembly plant. In 2014, the plant’s capacity was increased by just 50%. It can produce 450,000 cars per year.
- A new factory has been built in San Luis Potosi, Mexico. This factory was opened in 2019. In this factory all electricity is generated in an environmental friendly way. The factory can produce 175,000 cars per year.
- In the People’s Republic of China, the joint venture BMW Brilliance Automotive is responsible for the production and sales of cars. The factories, including a complete engine factory, are located in Shen Yang.
Hydrogen car from BMW
BMW set a goal to introduce a hydrogen car later this decade: the BMW i Hydrogen Next. The powertrain of this car consists of a fuel cell from partner Toyota and an electric motor & battery pack. Together, the car’s two hydrogen tanks can hold 6 kilos of hydrogen.
Hydrogen can be an important factor in creating a sustainable future. When the car of BMW works well, it can strongly contribute to the operating results of the car brand. It can then be attractive to buy BMW shares.