The top 10 stocks of a $1.3 billion South Korean EV mutual fund no longer include Tesla (TSLA) for the first time in its history after the automaker’s massive selloff in 2022, as per Teslarati.
It is worth noting that Tesla previously held as much as 9% of the EV mutual fund.
What caused this?
Korea Investment Management Co. cited volatility reduction as one of the reasons for its 2% reduction in Tesla’s stocks on the net asset value of its EV mutual fund.
Meanwhile, the lead manager of the EV fund Hwang Woo-taek told Bloomberg News that the company considered various internal and external factors against Tesla. These factors included Tesla’s potential competitors and CEO Elon Musk‘s substantial Twitter acquisition deal, which used Tesla’s stocks.
“We thought many external and internal elements were not favorable.”
Lead manager of the EV fund Hwang Woo-taek
What can Tesla do?
The South Korean EV mutual fund does not entirely neglect the American EV giant. However, Hwang clarified that Tesla must demonstrate that it can fulfill the market’s expectations, especially on its newest innovations like the Cybertruck and the internal 4680 battery cell production.
“We need something else to justify its valuations.”
Lead manager of the EV fund Hwang Woo-taek
About Korea Investment Management Co.
Korea Investment Management Co. outperformed 98% of its competitors over the last three years. It must be noted that this success is primarily attributed to Tesla and its rapid growth, even during the pandemic.
However, the company had its new low last year due to Tesla’s 65% decline and the general EV industry’s poor mood that year.
That said, it decided to reduce its stakes in Tesla while betting on companies like Eaton Corp. and ABB Ltd. that provide EV charging services. Moreover, Hwang also stated that he remains optimistic about the stocks of EV batteries.
CEO Elon Musk’s Twitter takeover deal led to a major selloff of Tesla’s stocks. According to many analysts and investors, this might seriously harm the automaker, which is precisely what happened, as this report demonstrates.
