Invest in Lithium – Investing in Lithium Beginners Guide 2021

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Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.

As an Investor/trader, you are always on the lookout for the next best investment to improve your portfolio. You probably spend ample time analyzing potential booms and hoping to make the highest gains. Since that is the case, this article has been written to provide you with an in-depth understanding of lithium as an investment. 

In this guide, you will learn how to invest in lithium, the pros and cons of investing in lithium and learn the best brokers to invest with.

#1 Broker to Invest in Lithium- eToro

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How to Invest – A step by step guide

Are you struggling to figure out how to invest in Lithium? We have created this easy-to-read guide to help you get started in less than 5 minutes. With these four easy steps, you can get started investing in lithium and several other commodities.   

  • Step 1: Open an eToro account: The first step is to find a broker that you can trust. We usually recommend eToro because it is a tested and trusted broker. Just type “eToro.com into your browser, and press the ‘join now’ button. Subsequently, you will fill in the required details. 
  • Step 2: Verify your identity: Etoro is a regulated platform that takes identity verification seriously. All you need to do is provide a photo ID (passport or driving license) and a proof of address (utility bill or bank statement)
  • Step 3: Fund your account: Once this is done, you need to fund your account. To do this, just click on “deposit funds” and enter the amount you want to invest, then press “deposit.”
  • Step 4: Invest in Lithium: That’s it! You are ready to invest. Just type “Lithium,” and you will get different investment options. Enter however much you like to invest, and press “Buy.”  

Where to Invest in Lithium- Choose a Broker

There is a long list of great options to choose from if you want to invest in lithium securities. However, you must choose a trusted and reliable broker. In some cases, your choice may be the difference between an excellent investment and a regrettable one. 

We have gone on to research and verify some great options when it comes to investing in lithium. 

1. eToro – Best Overall Broker to Invest in Lithium

Since being founded in 2007, eToro has warmed itself into the hearts of millions of users in more than 100 countries. Although it has a simple interface, eToro has a significant number of advanced trading features. The platform is intuitively designed to help anyone interested in quickly trading and learning while at it.   

Copy-trading has never been as easy as it is on eToro, and that is just one of the many things to love about this broker. 

Whether you decide to invest in lithium mining companies or the stock of battery companies, with eToro, there are many ways to benefit from lithium and its bye products.

Security and Privacy

Security is one of the more critical details to look out for in a broker. Etoro is keen on security as it is one of the platform’s significant focuses. The brokerage is trusted as it is regulated by both the FCA and SEC. As an extra layer of security, Etoro enables Biometric entry for mobile apps.

The brokerage also has measures to prevent accounts from getting compromised (e.g., by SSL encrypting sensitive information)  

Fees and features

Etoro has some impressive features for everyone. You can trade in a wide range of markets, including cryptocurrency, forex, and an endless array of stocks. 

If you are looking to invest in lithium stocks and other securities and effectively manage your portfolio in one place, then Etoro is an excellent option to consider. 

Etoro also remains one of the primary drivers of the social trading revolution; connecting traders and improving trades. Users can also use the CopyTrader technology to copy their trading portfolio performance automatically. 

eToro Fees

Fee Type Fee Amount
Deposit Fee $0
Withdrawal Fee $5
Commission Fee $0
Inactivity Fee (charged monthly) $10

 

Pros

  • Etoro is regulated but the appropriate bodies in the US and globally.
  • Commission-free 
  • Provides a patented CopyTrading option for users
  • It has a simple interface
  • SSL encryption
  • Works with two-factor authentication
  • Allows users to practice trading with a demo account 

Cons

  • Could benefit from MetaTrader support

67% of retail investor accounts lose money when trading CFDs with this provider.

2. HYCM- Great CFD provider to Invest in Lithium

With more than four decades of operation, it’s safe to say that HYCM has got some skin in the game. Founded in 1977 in Hong Kong, HYCM has evolved to become what it is today. 

With users from more than 140 countries, HYCM continues to grow its clientele and its offerings. HYCM is a good option If you are looking for a broker that offers trading options, including CFDs, stocks, cryptocurrencies, ETFs, and indices.

As you would expect, the company is regulated under multiple jurisdictions and offers more than 200 forex and CFD instruments. 

Features

With HYCM, you trade on Metadata only, offering MT4 and MT5 platform suites. Traders can also trade precious metals such as gold, silver, etc. 

With HYCM’s responsive mobile apps (for both IOS and Android), you can trade on the go. This broker also provides educational videos that provide in-depth market analysis and help you through the murky waters of trading and investing. They also provide 

SECURITY AND PRIVACY

However, with an overall trust score of 84 of 99, this broker has an impressive level of user trust. HYCM is authorized by both the Securities Futures Commission (SFC) and the Financial Conduct Authority (FCA)

HYCM Fees

Commission Fee $4 (for raw accounts) other accounts are commission-free  
Deposit Fee 
Withdrawal Fee  $30 for wires under $300 or 1% for withdrawals over $5,000
Inactivity fee  $10
Minimum Deposit  $100

 

Pros

  • Many years of experience 
  • You can get access to a personal account manager 
  • Uses the Metatrader 4 platform
  • Wide range of trading options  

Cons

  • Limited options (only forex and CFD products)

67% of retail investor accounts lose money when trading CFDs with this provider.

Fortrade – Accessible Platform to Invest in Lithium

Founded in 2013 in the UK, Fortrade is a multi-asset brokerage that trades forex, CFD, indices, shares, commodities, cryptocurrencies, ETFs, and bonds. Fortrade also offers simple live accounts with advanced tools. 

They also provide regular market news and analysis. Fortrade “aims to make online trading more accessible, enjoyable, and ultimately profitable.”  The broker offers trading instruments covering more than 50 currencies, about 250 stock CFDs, and several indices and commodities. 

Fortrade also prides itself on its speed and the security of its platform. The platform combines the widely accepted metatrader 4 with its proprietary platform.   

Fortrade Fees

Commission Fee Some accounts are commission-free, while some are not
Deposit Fee 
Withdrawal Fee  $40 (on average) 
Inactivity fee  $10 
Minimum Deposit  $50

 

Pros

  • Easy-to-use mobile and desktop platforms
  • Detailed educational materials
  • Free demo account
  • Access to market information
  • Regulated by several international regulatory bodies 

Cons

  • Sometimes withdrawals may take up to 15 days
  • Some traders prefer MT4 to Fortrade’s proprietary platform. 

67% of retail investor accounts lose money when trading CFDs with this provider.

Invest in Lithium – Broker Price Comparison

To help you decide which broker is best for your needs, you can check out the table below to easily compare their cost structures. All brokers provide easy access to Lithium stocks, so this will help you calculate your budget and pick the right brokerage solution for your strategy:

 

Broker Commission Deposit Fee Withdrawal Fee Inactivity Fee
eToro 0% $0 $5 $10/month after one year
HYCM Varies $0 $30 for wires under $300 or 1% for withdrawals over $5,000 $10
Fortrade Varies $0 $0 $50 after 3 months/$100 after one year

What are the different ways to invest in Lithium

Lithium is not a precious metal; therefore, there is no way to invest in lithium as a commodity directly. This is because there are no exchange-traded features with other metals like gold, copper, nickel, and aluminium.

However, if you are interested in the future of lithium, you can invest in many ways. As a beginner, you may find it somewhat confusing to understand the differences between these kinds of investments. To help, we will carefully consider each type of investment and know how it works.  

You can invest in lithium through the following ways;

Stocks

This is a more ‘hands-free’ approach to investing. As we said earlier, you cannot directly invest in lithium as a commodity because it is not a precious metal. However, you can purchase shares from companies that engage in either mining or processing lithium. 

To determine what company shares you want to buy, you need to consider their market share. This is because the value of a stock depends on the volume of the market that the company controls. The larger the market share of the company, the more advisable it is to own shares.

Also, as a shareowner, you have rights to passive income in the form of dividends. 

There’s no time like the present to invest in the best stocks on the market. Our list of top picks is updated regularly, so you can always be sure you’re getting the latest and greatest. Whether you’re a seasoned investor or just starting out, our guide will help you make the most of your money. So what are you waiting for? Start browsing today!

ETFs

Exchange-traded funds are a type of investment where traders hold a collection of securities. Although they are similar to mutual funds, ETFs are listed on exchanges and traded like traditional stocks. 

It is an investment that pools together money from investors into a basket of different assets and securities. This way, ETFs provide diversification and are a great way to mitigate risks.

ETF shares are traded on the stock exchange and are bought and sold like traditional stocks. 

You can earn returns from an EFT in 2 ways; When the ETF market price rises and, secondly, via dividends. Although not all ETFs pay dividends, ETFs that pay dividends have what you call a “Dividend Yield.”

EFTs can be bought and sold throughout the day and require way less minimum investment when compared to a mutual fund. 

If you’re looking for some hot tips on the best ETFs to invest in right now, you’ve come to the right place! Our beginners’ guide will lay out everything you need to know, including what they are and how they work. We’ll also give you a few recommendations on which ETFs might be right for your portfolio. So whether you’re a seasoned investor or just starting out, be sure to check out our guide on the best ETFs to invest in right now!

Others

There are other ways to downplay the risk and gain from investing in lithium. Some of these include CFDs, options, and commodity indexes.

Some investors opt to invest in either Electric Vehicle companies or batter producers. A great example of this is Tesla Motors– the largest EV battery company in the world. An investment with this motor giant can be seen as an excellent (indirect) investment in lithium.  

Looking for a top-rated CFD broker? You’ve come to the right place. Our experts have compiled a list of the best CFD brokers on the market, so you can find the one that’s right for you. So what are you waiting for? Check out our list today!

Best Ways to Invest in Lithium

Now that we understand the differences, let us delve into the specific details. To do this, we will answer the question: “Who can benefit from which type of investment?”.

(Remember, the most important factors to consider are; your investment strategy, needs, and how long you intend to invest.) 

Invest in Lithium Stocks

This is an excellent option if you believe in the long-term potential of lithium and have clear signs that the demand will consistently be high. Investing in shares is a perfect option for part-time traders who don’t constantly bother about the market. 

If this is so, then you should research and stock up on some lithium shares. 

You can either invest in;

– Companies that are involved in mining)

– Companies that invest in batteries)

– Companies that combine both mining and battery investments

However, to choose the best possible company to invest in, you need to consider certain factors. Firstly, you need to consider the scale of the business and its ability to scale over time. You also need to consider the company’s access to the global lithium market. Lastly, you should opt for a company with low operational costs. Than excellent is a great way to ensure that profit margins are high. 

Due to these reasons, The U.S Securities Exchange Commission described Albermarle Corporation (NYSE ALB) as a “preferred global lithium partner.” There are many other industry giants in the US and worldwide, each company leveraging one or more aspects of the lithium life cycle. 

Seasoned investors familiar with the lithium market can hold lithium stocks and improve their portfolios with them. 

Invest in Lithium EFTs

This is another excellent option if you believe in the long-term potential of lithium. However, unlike stocks, it offers more diversification and is less risky.

Investing in a lithium-based ETF (such as Global X Lithium & Battery Tech ETF) means that you are spreading your “bet.” It is a combination of investing in multiple shares of various lithium-based companies. 

There aren’t so many EFTs that are mainly focused on lithium. Most of them combine other commodities. However, the Global X Lithium & Battery Tech ETF offers more than 40 holdings for about $50 per share. 

Are you interested in being a part of the potential boom of lithium stocks? Etoro offers a variety of company stocks that provide significant investments in lithium. 

Etoro also has a large variety of lithium stocks and ETFs for you.  

Is Lithium a Good Investment?

Now that we have gone through the various ways to add lithium to your investment portfolio, the next question is; Should you invest in lithium?

Ordinarily, the answer to this question should be a resounding ‘Yes. 

However, that’s not how the world of commodities work. Despite the potential boom, you still need to thread the market with some caution. The reason for this is simple; several other factors affect the prices of lithium. 

Therefore, you need to understand the market before deciding whether an investment is good or not.

(As usual, we don’t want you to take any of this as financial advice. However, it can serve as a guide to help you further research and make the right investment decisions.) 

To help you decide whether lithium is a good investment, let us consider certain factors;

Investing in Lithium – What are the Risks?

According to LiveScience, today, many electronic devices use batteries that contain lithium metal or lithium compounds. With the constant innovation in mobile devices, many projects that demand lithium will continue to be steady through the decade. 

There is a constant demand for energy-on-the-Go products. Hence, a need for proper energy storage and lithium-ion batteries are an excellent option for this. (Used in phones, laptops, electric cars, etc.)

 Also, as giant companies like Tesla continue to rely on lithium as a critical ingredient for their product, the demand has increased exponentially. 

The effect of competing battery technologies

Change is a gradual process, and although there is a new wave of lithium-powered devices, competing battery technologies still exist and can affect lithium prices. Therefore, you must consider the effects that these technologies can have on the cost of lithium. 

The green revolution

Except you live under a rock, you must have heard about climate change and how we need to save the planet. Well, “the green revolution” may also mean more greens than red for lithium investors. Society’s need for an environmentally friendly approach to things may lead to increased demand for lithium-powered solutions. 

Lithium use cases

Although it is mainly used in batteries, lithium has several other uses, affecting lithium prices. Lithium has several benefits. This means that investments are on different levels. Understanding the market trends helps you to make informed decisions. 

Apart from the apparent sectors where lithium is beneficial, there is a cross-sector reliance on the metal. This means that a reduction of demand in one area may not drag the whole market down. 

Lithium has multiple uses depending on end-use markets. Understanding the many use-cases of lithium can help you to effectively position and predict future booms. Other benefits of lithium include;

  • Aircraft manufacturing
  • Mental health (Lithium carbonate is a great way to stabilize wild mood swings and is an excellent treatment for bipolar disorder) 
  • Used to create ceramic and glass, and so on. 

Lack of transparency

The lithium market is highly concentrated, and a few producers control the market. 

This may be bad for retail investors who cannot get the actual market value of the commodity as lithium itself isn’t publicly traded. Due to the low consolidation of ownership, lithium may be more volatile over time. 

Also, no one knows how much lithium we have access to right now because producers do not disclose that. Therefore, we may never know about a shortage until we are in the middle of it. 

The lack of transparency and limited access to information about supply and availability makes it uneasy about establishing its actual value as an investment. 

How to Invest in Lithium with eToro

Getting started with your trading account is extremely straightforward with eToro. Here is a detailed step-by-step guide to help you buy Lithium stocks right now on one of the best broker platforms on the market. 

Step 1: Open an Account with eToro

First, you need to access eToro, an easy-to-understand platform with access to different beginner-friendly tools, including copy trading, stop-loss orders, and plenty of assets to choose from. Make sure you create an account using a username, password, and email address.

Step 2: Verify Your Account

Before you start trading and investing your hard-earned cash, you need to follow the prompts on the screen to upload your ID and proof of address. As eToro is a regulated platform, you need to provide your personal documents to verify your identity, which is a standard privacy measure implemented by all regulated brokers. 

Step 3: Fund Your Account

Once your account is live, you can fund your account by clicking on the “deposit” button. You can choose from a wide range of payment methods available, including bank transfers and e-wallets like PayPal. You can also use eToro’s demo account to practice trading before investing your real cash into Lithium, learn how to use eToro’s tools and features, and test your strategy. 

Step 4: Invest in Lithium

When you are ready to invest, simply use eToro’s search bar to find Lithium. Next, add how much money you’d like to invest, set up your stop-loss and take-profit levels according to your strategy, and place your order. This will be executed at market price (during Nasdaq trading hours) or at a set price if you’ve opted to buy the Lithium stock at a specific price. 

Conclusion

In the 1790s, the mineral petalite (that would eventually be separated into lithium) was discovered. However, it was until 1855 that lithium was isolated. Since then, this particular metal has gained relevance and increased demand due to its diverse uses.

Recently, the World Street Journal described lithium as having a better claim than most commodities to be the “new oil.” Similarly, analysts from UBS project that the lithium market will grow 8X in 2030. Manufacturing remains an integral part of national GDP figures (for fast-growing economies).  Therefore, by trading lithium, you’re placing a bet on global GDP growth. 

Not only is lithium the lightest metal on earth, but it has also become a critical component in today’s tech age. The most obvious benefit of investing in lithium is the future demand potential. Although there is no shortage of lithium currently, a deficiency in the future will cause prices to shoot up. 

If your trading strategy is more long-term focused, then lithium is an excellent option to consider. Present and future innovations will essentially use lithium, and this will Increase demand over time. 

It can also work for mid/short-term investors. However, to do this, it is crucial to pay attention to the market. The lithium market is not as open, which means that traders may have limited information about the intricacies of the market. 

#1 Broker to Invest in Lithium – eToro

1
$50
Our score10
  • Buy over 800 stocks with 0% commission
  • Social trading network
  • Copy over 12 million traders and investors
0% Commissionstart TradingOur score 10

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About Ayotunde Olojede PRO INVESTOR

Ayotunde is a Nigerian writer and brand strategist with more than a decade of freelance writing experience. He has worked with various marketing agencies and has gained experience in brand strategy, copywriting, among other skills. He is keen on business, finance, branding, and renewable energy.