Billionaire investor George Soros has reportedly cut ties with Elon Musk by liquidating all of his shares in Tesla according to a new report.
Regulatory filings show that Soros Fund Management, the hedge fund owned by the financier, sold off all Tesla shares acquired since the second quarter of 2022 according to TheStreet. That publication notes that “It is unclear what prompted Soros to sell all of his Tesla position,” and it is possible Soros’ oddly timed stock purchases resulted in massive losses.
Soros’ move comes as a surprise to investors, especially considering his investment strategy in the automotive industry had been adjusted starting in the second quarter of last year. While it is unclear what prompted Soros to sell all of his Tesla position, TheStreet notes the company’s stock price rebounded significantly in the first three months of 2023, rising 68.4% after publishing stellar financial results on Jan. 25.
World Economic Forum / Flickr
Despite this strong rebound, Soros’ investment in Tesla likely generated modest returns at best, and abysmal losses at worst, according to the outlet.
It is also worth noting that Soros’ large purchases of Tesla stock happened while Musk was in a protracted business feud with Twitter’s former management and shareholders and sold his stock after Musk acquired the social media platform.
In the best-case scenario, the sale would have netted him $3.8 million, assuming he acquired shares at the lowest possible prices in the second, third, and fourth quarters of 2022 and sold them at the highest price in the first quarter of 2023. However, in the average scenario, Soros lost $9.8 million, while in the worst-case scenario, he lost $26.2 million.
Elon Musk at a TED Talk in 2017 (Steve Jurvetson / Flickr)
It remains unknown why Soros chose to sell off his Tesla shares, especially given the company’s recent success. It is possible that he simply decided to cut his losses and move on to other investments, or that he sees more potential for growth in other industries.
The controversial financier’s apparent decision to cut ties with Musk may assuage the concerns of some conservatives provoked by Musk’s latest hire, Linda Yaccarino, a member of the World Economic Forum who has far left political views and reportedly favors censorship.
