Nov. 10 (Reuters) – Tesla (TSLA.O) chief executive Elon Musk has sold around $ 5 billion in shares, the billionaire said in filings on Wednesday, just days after questioning users of Twitter on the sale of 10% of its stake.
In its first share sale since 2016, Musk’s Trust sold nearly 3.6 million Tesla shares, worth around $ 4 billion, while he also sold 934,000 other shares for $ 1.1 billion after exercising options to acquire nearly 2.2 million shares.
The 4.5 million shares equate to about 3% of his total stake in the electric vehicle maker, which is the bulk of his estimated fortune at $ 281.6 billion, according to Forbes.
Musk asked Twitter users on Saturday about the sale of 10% of its stake, helping to push Tesla’s share price down after a majority on Twitter said it agreed with the sale.
Stock fell 12% on Tuesday in a multi-day sell-off that put the company’s position in the $ 1 trillion club at risk, but recovered 4.3% on Wednesday. Read more
Option-related sales were put in place in September through a trading plan that allows company insiders to set up pre-planned trades on a schedule, according to the filing. The sales of the shares linked to the option paid the associated taxes. It was not clear how or if the business plan tied to Musk’s Twitter poll. Tesla did not respond to a request for comment.
The sales of the additional shares were separate and provide Musk with significant cash reserves, given that his wealth is largely tied to his holdings in Tesla and SpaceX.
Musk has over 20 million additional stock options set to expire in August of next year.
If Musk were to implement the 10% share sale plan, it would be a slight negative in the near term, said Mark Arnold, chief investment officer at Hyperion Asset Management in Brisbane, where Tesla is the main stake in his global fund. .
âBut the stock is quite liquid and doesn’t represent a huge percentage of the total issued shares, so that shouldn’t have as much of an impactâ¦ we’re pretty comfortable with the outlook for the company,â a- he declared.
While Tesla lost nearly $ 150 billion in market value this week, retail investors have been net buyers of the stock. As of Wednesday, 58% of Tesla’s trade orders on Fidelity’s brokerage website were for purchases rather than sales.
Retail investors made net purchases of $ 157 million on Monday and Tuesday, according to Vanda Research.
Tesla is now up more than 51% in 2021, largely thanks to an October rally that was fueled by a deal to sell 100,000 vehicles to car rental company Hertz (HERTZ.UL). Read more
âThe company itself is on fire, with strong results,â said Tim Ghriskey, senior portfolio strategist at Ingalls and Snyder, a New York-based investment management firm.
Bullish sentiment returned to Tesla options on Wednesday, with around 1.1 calls traded for each put option. Call options are generally used for bullish trades, while buying put options shows a bearish bias. Read more
The company’s options accounted for about $ 109 billion in premiums traded in the past two weeks, or about one in three dollars traded in the U.S.-listed options market, according to a Reuters analysis of Trade Alert data.
Reporting by Hyunjoo Jin, Noel Randewich and Greg Roumeliotis; Additional reports by Sruthi Shankar, Subrat Patnaik, Medha Singh and Bansari Mayur Kamdar in Bengaluru; Katanga Johnson and Chris Prentice in Washington, Tom Westbrook in Sydney and Saqib Iqbal Ahmed and Ira Iosebashvili in New York Editing by Peter Henderson and Richard Pullin
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