Written 05/20/2022
We are nearing the 3-year anniversary of the Adam Jonas low in Tesla stock that occurred June 3, 2019 when the Wall Street analyst hosted a call that belabored his perceived risks of a Tesla investment. That day the stock hit a split-adjust low price of $35.40 per share.
Two days ago, Tesla’s share price traded at $728 per share during the day. The growth in Tesla stock represents an astounding twenty-fold increase, or a 20x. If someone bought $50,000 of Tesla that day, today they have more than $1,000,000 in Tesla stock which makes them a “Teslanaire.” Tesla has certainly been volatile along the way, so it has by no means been easy. In 2020, it dropped 60% from high to low, in 2021 it dropped 40% from high to low, and it has dropped 45% this year since reaching $1,200 on January 3rd.
It's hard to buy at the exact bottom in a stock, so many Teslanaires likely put in more than $50k per $1 million they have today. Many Teslanaires went all-in Tesla between 2018 and early 2020, and their lives have fundamentally changed.
I know many Teslanaires, but it wasn’t until I traveled to Austin Texas that I realized just how many there might be. In April 2022 when Tesla had the grand opening Cyber Rodeo at Gigafactory Texas, numerous Tesla fans traveled to Austin in hopes to get a factory tour. Other fan events spawned around the Cyber Rodeo such as Twitter, Clubhouse, and Tesla Owners of Austin meetups. The biggest event was TeslaCon Texas which was a full day event that featured dozens of speakers and sold 2,000 tickets.
During my five days in Texas, I realized that many people who for Cyber Rodeo was all-in Tesla (50% or more of their liquid investments in Tesla stock). Of all the Tesla fans I spoke with, only one admitted to having less than 50% in Tesla. In retrospect, that shouldn’t have surprised me. What shocked me was just how many Teslanaires there were and how deep the Tesla community is.
Certainly, this goes against the common financial planning for the average retirement investor. Most advisors suggest that you should not be heavily concentrated in any individual security, and heavily concentrated can be greater than 10%. If you’re not already all-in Tesla, I’m not suggesting that it is an appropriate course of action for you.
After talking with dozens of Teslanaires, I realized that many share common experiences and common bonds. Teslanaires are rebellious and curious future-thinkers who broke all the traditional Wall Street rules and risked it all by putting a majority of their money in Tesla. Teslanaires are mentally tough and ignored the media despite the constant attacks on Tesla and Elon Musk. Now that they have a meaningful amount of wealth Teslanaires are thinking about how they will impact the world and the people they love.
Teslanaires are tired of being judged by Wall Street, the media, short sellers, and vested interests. There’s the pressure from the status quo to diversify and everyone around them say they’re doing it wrong. The constant pressure to comply and be like everyone else puts the Teslanaire in the mindset of the rebel or heretic.
In story after story, I heard that Teslanaires were laughed out of the offices of a financial advisor once they showed the advisor their statements. Nearly all advisors refuse to give them advice about the other part of their finances unless the Teslanaire agrees to sell a substantial portion of their Tesla stock. This is the last thing they want to do. Instead of ridicule and scorn, the Teslanaire deserves respect because what they did was incredibly hard.
What we know is that it is precisely the rebel or heretic that changes the world. Elon Musk isn’t changing the world because he is like every other buttoned-up CEO, Musk is changing the world because he is radically different. Teslanaires do not want cookie cutter financial advice, nor do they want to be bullied or talked down to by advisors who haven’t done the hard work.
It’s possible that Teslanaires can become even more incredibly wealthy and truly have the power to leave a lasting positive impact on the world that could last for generations to come. Many outspoken Tesla bulls predict that Tesla stock can still multiply in value by tenfold or even a hundredfold from here if Tesla solves autonomous driving and the factory robot. If this scenario happened, this could turn $1 million into ten or even one hundred million dollars.
Many have their doubts about Tesla reaching these valuations as this valuation would represent a large ratio compared to the U.S. Economy. It’s possible that Tesla’s sales do not grow as fast as Tesla bulls think, or that Tesla does not solve autonomous driving or the factory robot, and then the stock could disappoint investors.
This week I decided to do an unscientific Twitter poll where I asked how much Tesla stock people had. This is not a statistically representative poll as my Twitter followers tend to be Tesla car owners and investors…
…if people are answering honestly, on Twitter alone and of those who saw the poll, there are at least 1,105 Teslanaires and 231 who claim to have more than $10 million in Tesla stock. Many did not participate in the poll, and many are not on Twitter at all. It’s possible there are over ten thousand Teslanaires!
Maybe you’re reading this because you are a Teslanaire or well on your way to being one. Where many financial advisors refuse to work with Teslanaires, we want to help you keep your wealth and make the impact that most inspires you. What we do is create a custom financial plan based on your values, your goals, and your priorities. We look for ways to protect your wealth, optimize taxes, and steer around the timing of high expenses such as kids’ education, real estate purchases, or even deal with divorce.
Halter Ferguson Financial helps Teslanaires build a sustainable financial model for their Tesla investment, so you aren’t left out to dry when Tesla stock goes down. We use strategies to control your risk and stay agile through the ups and downs. We understand your Tesla journey because we have been through it with you.
Looking out for you,Bradford Ferguson, CFA
This is not financial advice to go all-in Tesla, nor to buy or sell Tesla stock and/or options