NEW YORK, Nov 26 — If you traded a stock in the past week, there’s a fair chance it was Tesla.
Shares in the electric car maker led by CEO Elon Musk rose almost 3 per cent yesterday and have now surged 40 per cent since November 16, when it was announced Tesla would join the S&P 500 in December. Investors rushed to buy shares ahead of index funds that will be forced to acquire over US$50 billion (RM204 billion) of its shares.
One of Wall Street’s most loved — and hated — stocks, Tesla was already the US stock market’s most traded companies by average daily value, but trading has surged in recent sessions, along with Tesla’s stock price.
“It’s been crazy. Since Tesla’s (announced) inclusion in the S&P, you’ve had a lot of managers out there that didn’t own enough of it having to buy more,” said Sahak Manuelian, managing director of trading at Wedbush Securities, in Los Angeles.
Retail investors using apps like Robinhood are also responsible for much of the recent volume spike, Manuelian added.
Traders bought and sold an average of nearly US$26 billion of Tesla shares per session over the five days ending on Tuesday, accounting for almost 8 per cent of all stock traded on US exchanges, according to Refinitiv data. That is more than the combined value of trades in Amazon.com Inc and Apple Inc over the same period.
At about halfway through yesterday’s session, traders had exchanged US$20 billion worth of Tesla shares, according to Refinitiv.
Up over 400 per cent in 2020, Tesla has become by far the world’s most valuable automaker, despite production that is a fraction of Toyota Motor Corp, Volkswagen or General Motors Co.
Over the past year, Tesla has averaged over US$16 billion a day in trades, followed by Apple, at about US$14 billion, according to Refinitiv data.
Trading in Chinese electric vehicle maker NIO Inc has also surged in recent weeks, with its shares nearly doubling in November.
Including NIO, trading of stocks in the nascent electric vehicle industry reached an average of US$38 billion a day in the past five sessions, accounting for 12 per cent of all trading on US exchanges. By comparison, traders in the same period bought and sold each day about US$8 billion worth of oil and gas stocks including Exxon Mobil and Chevron. — Reuters
