Tesla share rally propels some early fan investors to riches
<p style="text-align: center;"><img title="1595306314711014.png" alt="7.png" src="/ueditor/php/upload/image/20200721/1595306314711014.png"/></p><p>Convinced of Tesla Inc's imminent meteoric rise, Orestis Palampougioukis, a Netherlands-based software developer, took out a 43,000 euro ($49,000) loan in early October to invest it all in the electric carmaker, which at the time was trading at around $230 a share.<br/><br/>Since then, Palampougioukis' bet has paid off as Tesla's share price has increased more than six-fold, trading around $1,500 on Monday and surpassing every rival to become the world's highest-valued automaker. After investing an additional 14,000 euros in personal funds, he has pocketed around 10,000 euros in profit to date, even when accounting for the 7% interest he pays the bank.<br/><br/>"To me it didn't feel like a bet because I studied what Tesla does very closely and it's simply inevitable that it would dominate," Palampougioukis said, adding that he plans to own the shares for decades.<br/><br/>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 at times their parents' retirement funds, in Tesla and reaped handsome rewards.<br/><br/>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 boosted hopes among many retail investors for a profitable quarter.<br/><br/>Discussions about Tesla on online retail investor forums have surged, with users debating whether to hold their shares in hopes of even higher returns or cash out.<br/><br/>While the total number of Tesla retail investors is not known, around 75% of the company's stock is owned by large institutional investors and Tesla executives, including Chief Executive Elon Musk, according to Refinitiv data.<br/><br/>Tesla shares are among the most popular on U.S. retail investor platforms, such as Robinhood Markets Inc and TD Ameritrade . The number of users holding Tesla stock on 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 compiles data on the investing platform.<br/><br/>In South Korea, where Tesla has become the latest craze among tech-savvy professionals, the company is the most-traded overseas stock, with Koreans buying $3.2 billion worth of Tesla shares so far this year, up nearly 13-fold from all of 2019.<br/><br/>Choi Jong-wan, the former head of Korea's Tesla owners' club, borrowed money to invest in Tesla after the company unveiled its Model 3 in 2016. He also bought Tesla stock for his seven-year-old son, taking advantage of Korean inheritance tax breaks.<br/><br/>Choi, who bought a Model S, said the company's shares are supported by its many fans buying stock. Convinced of Musk's vision, Choi bought when Tesla shares tanked in the past.<br/><br/>"I am getting more confident about Tesla," he said. "I will sell Tesla stock when other automakers introduce better electric cars than Tesla at competitive prices."<br/><br/>Some investors have invested their stock proceeds in the company by buying its 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 shares.<br/><br/>He bought his first Tesla shares for a couple of hundred dollars right out of college in 2010. The company had just listed publicly, with the shares trading around $29.<br/><br/>David has since invested about another $40,000 and currently holds 180 shares.<br/><br/>"Tesla has treated me well so far. I believe in their vision and I believe in Elon Musk," he said. "But the house we bought needs a new roof and I'm thinking to just sell a few shares to pay for that."<br/><br/>Musk's own net worth has soared even higher thanks to the latest share price rally. The outspoken Tesla boss is within reach of another share-based payday potentially worth as much as $2 billion. Including previously vested tranches, Musk would own options for about $4 billion worth of Tesla shares.</p>
21 Jul,2020
