Foreign investors aggressively bought Tesla, but their holdings' value has been halved...

Tesla Stock Price $177.59
Plummets Over 56% Since the Beginning of the Year

[Image source=Yonhap News]

[Asia Economy Reporter Minji Lee] Domestic investors' Tesla holdings have been halved. Although investors' affection for Tesla has grown, the value of their holdings has significantly decreased due to a sharp drop in the stock price. Amid expected poor performance caused by a global economic slowdown and reduced automobile consumption, domestic investors appear to be responding by buying more shares, averaging down and purchasing at lower prices.

According to the Korea Securities Depository on the 10th, as of the 8th (data compiled up to two days prior), the value of Tesla holdings by domestic stock investors was 13.6511 trillion KRW, which shows a decrease of about 10 trillion KRW compared to the 23.8345 trillion KRW at the beginning of this year, over roughly ten months. Investors bought more shares than last year, but the valuation amount actually decreased. As of the previous day, the net purchase amount by foreign investors this year was 2.9996 trillion KRW, exceeding last year's net purchase amount of 1.3737 trillion KRW.

The shrinkage in Tesla holdings is due to the sharp plunge in Tesla's stock price, which significantly reduced the value of shares. Negative interest rate hikes affecting growth stock sentiment, along with ongoing issues related to the automobile business and the Twitter acquisition, have contributed to this. Tesla's stock closed at $177.59 on the 9th (local time), down 7% from the previous day. After Elon Musk's tweet encouraging Republican voting on the 7th, the stock fell below $200 for the first time since June last year. Additionally, news of Tesla's share sales and electric vehicle recalls accelerated the stock's decline. On an annual basis, the stock has plummeted over 56%.

The market says Tesla's stock price has fallen as far as it can, but experts believe it is still too early. With the psychological resistance level of $200 breached, domestic investors have seen this month as a buying opportunity, purchasing Tesla shares worth 116.6 billion KRW, making it the second most bought stock after the Nasdaq 3x leveraged ETF (175.6 billion KRW). Experts advise against increasing investment weight due to anticipated demand slowdown from reduced consumption and cuts in electric vehicle subsidies in China and Europe, which are expected to limit future sales growth. The UK and Germany, which account for 50% of Europe's electric vehicles, have begun eliminating or reducing EV subsidies, and China plans to stop subsidies starting next year.

Im Eun-young, a researcher at Samsung Securities, said, "The decline in Tesla's stock price is more about concerns over weakening automobile business performance than just owner risk. It won't be too late to increase investment weight after confirming the impact of subsidy reductions on Tesla's factory operating rates and pricing policies."

Meanwhile, the value of holdings in other U.S. tech stocks has also sharply declined compared to the beginning of the year. The global interest rate hikes have accelerated stock price drops, and recession fears have lowered earnings forecasts. Nvidia, facing concerns over a sharp drop in semiconductor demand, decreased from 43.794 trillion KRW to 27.546 trillion KRW, and Meta, whose stock price has fallen over 70% in a year due to profit declines from new business initiatives, dropped from 11.621 trillion KRW to 3.988 trillion KRW. Other companies such as Apple (7.0392 trillion KRW → 5.9818 trillion KRW), Microsoft (3.0825 trillion KRW → 2.3595 trillion KRW), Alphabet (3.0495 trillion KRW → 2.3327 trillion KRW), Amazon (2.5596 trillion KRW → 1.3326 trillion KRW), Lucid (1.3219 trillion KRW → 553.9 billion KRW), and ASML (888.5 billion KRW → 610.7 billion KRW) have also not escaped the decline in share value.

This content was produced with the assistance of AI translation services.