Trade Rio Tinto Shares – Our Best 3 Platforms Picks To Buy & Sell 2021

Rio Tinto (RIO)

With a market cap of £70.2 bn Rio Tinto engages in exploration, mining and mineral resource processing in the iron ore, aluminium, copper and diamond sectors.

The main market is iron ore which generated $24,1 billion of revenue in 2019.

Rio Tinto is a highly cash generative which is reflected in the current dividend yield (5.34% as at 3/2/2021).

With the global economy likely to contract in 2021 due to the pandemic, one argument is that this is likely to see a contraction in demand and a fall in commodity prices. The counter argument is that governments will try to spend their way out of recession, investing in infrastructure projects.

Rio Tinto’s share price is likely to see volatility reflecting price movements in metal prices and consumption in China.

According to Hargreaves Lansdown: ” Rio might technically be a diversified miner, but iron ore is really what it’s all about – accounting for three quarters of cash profits this half. And thanks to strong Chinese demand and supply constraints – propping up the iron ore price – being mostly about iron ore is working well for Rio at the moment.

With production costs at the flagship Pilbara mines under $15 a tonne, Rio has the potential to produce at incredibly low costs. Average market prices are currently in excess of $80 a tonne – digging up some dirt and selling it for five times what it costs is an attractive proposition by anyone’s standards.

Of course sensitivity to commodity prices is a curse as well as a blessing. When prices collapsed in 2015/16 as demand from key growth markets like China dried up, Rio was forced to embark on a brutal cost cutting exercise.

The group remained profitable, but had a mountain of debt on the balance sheet. Since then debt has been reduced to more manageable levels. Organic cash generation has played a part, boosted by a rebound in prices, and the sale of coal assets also brought in much-needed cash.

That’s just as well because coronavirus is proving to be a turbulent time”.

Trading or investing in Rio Tinto – What is the difference?

Trading Rio Tinto:

“If you are looking to trade the FTSE  to make short term profits you can use products such as CFDs and spread bets to speculate on Rio Tinto’s share price increasing or decreasing without having to take direct ownership of the shares themselves”.

CFDs (Contracts For Difference) and spread betting are leveraged products, which means you can gain full exposure to the FTSE 100 through a stock while only putting down a small deposit. While this magnifies possible profits, it does the same for losses.

CFDs & spread bets are popular among short term traders as profits and losses are realised immediately – making it faster to open and close trades.

However, this doesn’t mean you can’t use them for longer-term positions too.

You’d just need to consider the costs involved in maintaining a position – such as overnight funding – and the bet duration as spread bets do have fixed terms.

They also enable you to buy and sell shares online without ever owning the underlying asset. This has tax benefits and means you can trade both rising and falling markets (Tax laws are subject to change).


Investing in Rio Tinto:

As an investor you will be looking to invest in Rio Tinto in the hope that over time the Company grows & generate good profits.

As an investor you are typically investing for the longer term e.g. 5 years or more is normal.

When you buy shares you become a part owner of Rio Tinto and gain shareholder rights including any income that is paid as dividends.

With profits you make on share trading capital gains and dividends earned may be subject to tax at your personal rate. Tax can be mitigated if you trade within an ISA or Self Invested Personal Pension account.

How To Buy Rio Tinto Shares

      • Select a share platform – See below our top 3 platform picks
      • Open your share account – To do this you will need your bank details and national insurance number
      • Fund your account – You will need to fund your a/c with a debit or credit card or bank transfer
      • Search for Rio Tinto using the stock code – Type in the stock code RIO into the search box
      • Check out the latest info and price Rio Tinto shares – Some platforms offer free research and analysis
      • Buy Rio TintoNice and easy!

Our view:  The next generation of online trading platform means you can buy Rio Tinto in as little as 10 minutes! See our top picks for buying shares below:

Trading:

Trade  Rio Tinto ShareseToro Share Trading

Capital is at risk. 

  • 0% commission on stocks
  • Free account
  • Inactivity fee after 12 months

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Investing:

Invest in Rio Tinto Shares

Capital is at risk. HL Share Trading

  • Fixed fee platform – £5.95 to £11.95 per trade
  • Free to hold shares (ETFs are shares)
  • No inactivity fees

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Invest in Rio Tinto Sharesii Share Dealing

Capital is at risk. 

  • 1 free trade per month
  • Fixed fee platform – £9.99 pm
  • No inactivity fees

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  • Important Risk Information:

    No news, feature article or comment should be seen as a personal recommendation to invest. Prior to making any decision to invest, you should ensure that you are familiar with the risks associated with a particular plan. If you are at all unsure of the suitability of a particular product, both in respect of its objectives and its risk profile, you should seek independent financial advice.

    The value of shares, ETFs and ETCs bought through a share dealing account, a stocks and shares ISA or a SIPP can fall as well as rise, which could mean getting back less than you originally put in. Past performance is no guarantee of future results.

    Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 67%-75% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Professional clients can lose more than they deposit. All trading involves risk.

    Tax treatment of ISAs depends on your individual circumstances and is based on current law which may be subject to change in the future. ISA transfer charges may apply, please check with your provider.

 

Written by Editorial Team ,
5th February 2021