Chart of the Week: Nio’s Price Surged as Delisting Risk Alleviated After Debut on SGX

May 27, 2022

Electric vehicle (EV) manufacturer NIO Inc (NYSE: NIO) (SEHK: 9866) (SGX: NIO) is one of the Chinese tech firms that have suffered amid concerns over the threat of delisting from major US exchanges.

Year-to-date, Nio’s total return was down by 49.4%.

In the US, the Holding Foreign Companies Accountable Act (HFCAA) requires foreign companies to open audit reports for inspection by US regulators or they will be banned from trading their stocks in the US.

Additionally, Nio also faced other headwinds such as the global supply chain disruption and inflationary pressure.

Nio makes its Singapore debut

Nio has completed its listing on the Singapore stock exchange last week, making it the third exchange where investors can trade Nio stocks.

The company is also listed on both the New York and Hong Kong stock exchanges.

The listing in Singapore helps to alleviate some of the overhang on Nio stocks as it provides alternative platforms to trade their shares in the event of a delisting from the New York stock exchange.

Choppy trading of Nio continues

Despite the reassurance to investors with the Singapore stock exchange debut, Nio’s share price hasremained choppy.

Yesterday, its share price soared by 9% to US$16.03 per share. However, the share price dropped by more than 12% just a week ago.

Given the bearish inclination of Nio’s share price and the volatile movement in the near-term, traders can take advantage with an options trading strategy. One of the ways is by using the strip straddle options strategy that I just wrote yesterday.

Disclaimer: ProsperUs Investment Coach Billy Toh doesn’t own shares of any companies mentioned.

Billy Toh

Billy is deeply committed to making investment accessible and understandable to everyone, a principle that drives his engagement with the capital markets and his long-term investment strategies. He is currently the Head of Content & Investment Lead for Prosperus and a SGX Academy Trainer. His extensive experience spans roles as an economist at RHB Investment Bank, focusing on the Thailand and Philippines markets, and as a financial journalist at The Edge Malaysia. Additionally, his background includes valuable time spent in an asset management firm. Outside of finance, Billy enjoys meaningful conversations over coffee, keeps fit as a fitness enthusiast, and has a keen interest in technology.

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