Tesla Chief Executive Officer (CEO) Elon Musk's remarks about founding the 'America Party' caused Tesla's stock price to drop more than 6% overnight. Tesla is one of the stocks most held by retail investors who invest in overseas stocks, but recent concerns over owner risk and worsening performance have accelerated the withdrawal of investment funds.
On the 7th (local time), Tesla's stock closed down 6.79% at $293.94 compared to the previous transaction. In just one day, the market capitalization evaporated by $68 billion, shrinking to $921 billion.
It has been about a month since Tesla's stock fell below $300 after President Donald Trump and CEO Elon Musk publicly debated a tax cut bill, leading to a 14% crash in the stock price.
Elon Musk's declaration to found the 'America Party' has acted as a negative factor for the stock price. Musk claimed, "I will focus on securing 2 to 3 Senate seats and 8 to 10 House seats to cast decisive votes on contentious bills." In response, President Trump publicly condemned it as "absurd and irrational behavior."
As owner risk does not diminish, some investors are in a mood to 'cut losses.' According to Koscom ETF CHECK on the 8th, the most sold ETF by retail investors this month is the 'ACE Tesla Value Chain Active,' with a net selling amount reaching 44.9 billion won. This product contains 19% of TSLL, which tracks Tesla's daily stock price volatility at double the rate, and 16% of a single Tesla stock.
Retail investors participating in direct investment in the U.S. stock market also seem to be adjusting their positions. According to the Korea Securities Depository, domestic investors have sold Tesla shares worth $115.76 million (150 billion won) since the beginning of this month (based on the settlement date), indicating a selling advantage.
However, during the same period, the stock that experienced the highest net purchase was also TSLL (Direxion Daily Tesla Bull 2X Shares), which is based on Tesla. The recent sharp drop in stock prices has led investors expecting a technical rebound in the short term to aggressively purchase TSLL.
Performance risks are also fueling investment anxieties regarding Tesla. The recently passed tax cut bill (OBBBA) from the Trump administration contains provisions to terminate tax credits for electric vehicles early, in accordance with the Inflation Reduction Act (IRA). Electric vehicle sales are significantly affected by policy support.
According to the OBBBA, the tax credit for purchasing American-made electric vehicles, which was previously up to $7,500, will end on September 30.
Global investment bank JP Morgan projected that if the tax credit for electric vehicles is abolished, Tesla's operating profit will decrease by $1.2 billion (approximately 1.62 trillion won) annually, as it is estimated that last year Tesla customers received about half of the tax credit benefits.
Korea Investment & Securities stated in a report this month that "intensifying competition in the electric vehicle market in China and decreasing consumer brand recognition in North America and Europe could act as burdens on Tesla," adding that "some of the sales volume in the second quarter could reflect advance purchase demand ahead of the termination of the tax credit."
In the second quarter of this year, Tesla's electric vehicle sales totaled 384,000 units, a 13% decrease compared to the same period last year. However, as market expectations significantly lowered, evaluations that the actual results were better than expected led to stock prices not dropping sharply.
Meanwhile, although Tesla's stock price has experienced volatile fluctuations, it seems that there are not many investors who have entered into a loss position yet. As of that day, the average purchase price in Korean won for 304,745 Tesla investors linked with Naver Pay's 'My Assets Service' is 377,935 won. Based on the current stock price, they are recording a revenue of 7.4%.