NEW YORK / SEOUL – Convinced of Tesla Inc’s impending meteoric rise, Orestis Palampougioukis, a Netherlands-based software developer, took out a loan of 43,000 euros ($ 49,000) in early October to invest it all in the electric car maker, which at that time was trading around $ 230 per share.
Since then, Palampougioukis’ bet has paid off as Tesla’s share price has more than six-fold, trading around $ 1,500 on Monday and outperforming all rivals to become the automaker. most valuable in the world. After investing an additional 14,000 euros in personal funds, he has bagged around 10,000 euros in earnings to date, even when he represents the 7% interest he pays the bank.
“It didn’t seem like a gamble to me because I studied what Tesla does very closely and it’s just inevitable that it will dominate,” Palampougioukis said, adding that he plans to own the shares for decades.
He is not alone. Retail investors around the world, staunch believers in the company’s mission to lead the auto industry into a battery-powered future, have invested their personal money, and sometimes their parents’ retirement funds, in Tesla and got beautiful rewards. (Graphic: https://tmsnrt.rs/39bu0lO)
Tesla reports second quarter results on Wednesday after the close of trading. While analysts polled by Refinitiv on average expect the company to report a loss, a surprisingly strong vehicle delivery report raised hopes among many retail investors for a profitable quarter.
Discussions about Tesla have erupted in online retail investor forums, and users debated whether to hold their shares in hopes of making even higher returns or withdrawing cash. (Graphic: https://tmsnrt.rs/3jmlmWr)
While the total number of Tesla retail investors is unknown, about 75% of the company’s shares are owned by large institutional investors and Tesla executives, including CEO Elon Musk, according to Refinitiv data.
Tesla’s shares are among the most popular on US retail investor platforms, such as Robinhood Markets Inc and TD Ameritrade. The number of users holding Tesla shares in the Robinhood trading app increased more than 400% from the first two weeks of July 2018 to the same point this year, according to data from Robintrack.net, which collects data on the platform. investment.
In South Korea, where Tesla has become the latest craze among tech-savvy professionals, the company is the most sought-after overseas stock, with Koreans buying Tesla shares worth $ 3.2 billion at this year, almost 13 times more than all 2019.
Choi Jong-wan, a former director of the Korean Tesla Owners Club, borrowed money to invest in Tesla after the company introduced his Model 3 in 2016. He also bought Tesla shares for his seven-year-old son, taking advantage of the inheritance. Korean. tax exemptions.
Choi, who bought a Model S, said the company’s stock is backed by its many fans who buy stock. Convinced of Musk’s vision, Choi bought when Tesla’s stock collapsed in the past.
“I am becoming more confident about Tesla,” he said. “I will sell Tesla shares when other automakers introduce better electric cars than Tesla at competitive prices.”
Some investors have invested their stock earnings in the company by buying their vehicles. David, a marketing specialist from Oakland, California, who asked that his last name not be used, bought a Tesla Model 3 last August after selling some of his Tesla stock.
He bought his first Tesla shares for a couple of hundred dollars fresh out of college in 2010. The company had just gone public, and the stock was trading around $ 29.
Since then, David has invested around another $ 40,000 and currently owns 180 shares.
“Tesla has treated me well so far. I believe in his vision and in Elon Musk,” he said. “But the house we buy needs a new roof and I’m thinking of selling some shares to pay for that.”
Musk’s net worth has skyrocketed further thanks to the latest rally in stock prices. The outspoken Tesla boss is within reach of another stock-based payday with a potential value of up to $ 2 billion. Including previously purchased tranches, Musk would own options for approximately $ 4 billion in Tesla stock.
(Report by Tina Bellon in New York and Hyunjoo Jin in Seoul; additional report by Noel Randewich in San Francisco; Dan Grebler edition)
