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

Billy Toh

May 27, 2022

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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.

About the Author: Billy Toh

Billy is passionate about the capital market and believes in investing for the long haul. Prior to this, he was an economist at RHB Investment Bank, covering Thailand and Philippines market. He also worked as a financial journalist at The Edge Malaysia and has experience working with an asset management firm. Aside from the capital market, Billy loves a good conversation over a cup of coffee, is a fitness enthusiast and a tech geek.