Tesla takes the cake for Aussie investor trading

By Grace Ormsby

July 06 2020
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Retail investors are still jumping onto the Tesla bandwagon. Why is it doing so well despite the pandemic?

nestegg recently reported on the company’s $1,000 share milestone, which made the Elon Musk-headed brand “the most valuable carmaker in the world”.

It has maintained this momentum through June, with investment platform eToro observing the brand as being “one of the most frequently invested stocks by retail investors throughout 2020, especially in June”.

In the last month alone, it jumped to the highest-ranked stock as purchased by Australian investors, with a 709 per cent monthly change in trading activity.

In May, it had been the fifth most regularly traded stock by Aussie investors.

According to eToro analyst Josh Gilbert, the car and tech giant “has seen a huge rise in share price since its lows in March”, as well as being one of the most frequently invested stocks on the platform over the course of 2020.

He highlighted how “Tesla’s share price was up more than 22 per cent in June as it went on to breach $1,000, smashing its record high”.

“Tesla has rapidly become a household name within the last 12 months,” Mr Gilbert commented, calling the electric vehicle giant the world’s most valuable carmaker.

Its most recent success is attributable to improved sales in China, and a new stock sale before the pandemic allowed Tesla to raise over $2 billion in cash.

Mr Gilbert said that in hindsight, that sale “was a key move” – with most warehouses worldwide closed during the fallout of the pandemic.

He also flagged how a recent email leaked from the CEO saw the share price surge more than 8 per cent in June, as Mr Musk showed optimism the company could break-even in the second quarter.

Is there another Tesla waiting in the wings?

According to eToro, there’s another electric car company waiting in the wings, with investors of a Chinese car company hoping it could reach Tesla-level stock market highs.

The multiasset investment platform has flagged the recent popularity of Nio Inc with Australian retail investors, which was the third most-traded stock on the platform.

Mr Gilbert said Nio Inc “is often considered the Chinese equivalent of Tesla, specialising in developing electric vehicles”.

Its share price jumped more than 68 per cent in June and is up more than 105 per cent for the year, which the analyst noted as “following in Tesla’s footsteps”.

“When Tesla listed on the Nasdaq back in 2010, its shares were available for less than $20, so many investors will be hoping that Nio can replicate Tesla’s growth,” Mr Gilbert considered.

He also explained that a mid-June share price surge for the Chinese manufacturer did occur, when technology company Tencent increased its holdings in Nio to 15 per cent, from its second share offering.

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About the author

Grace Ormsby

Grace is a journalist on Momentum Media's nestegg. She enjoys being able to provide easy to digest information and practical tips for Australians with regard to their wealth, as well as having a platform on which to engage leading experts and commentators and leverage their insight.

About the author

Grace Ormsby

Grace is a journalist on Momentum Media's nestegg. She enjoys being able to provide easy to digest information and practical tips for Australians with regard to their wealth, as well as having a platform on which to engage leading experts and commentators and leverage their insight.

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