The legendary financier continued to buy Tesla shares in the fourth quarter despite the electric vehicle maker’s stock market rout.
Elon Musk asked a provocative question to George Soros last month.
The question was related to the way Soros uses his money and indirectly about the numerous donations the legendary financier makes.
“Do you actually know where your money is going?” Musk said on Jan. 16, referring to Soros.
Soros never responded. But there is no doubt that Musk’s question touched on the multiple conspiracy theories that have been circulating for several years about Soros. The Hungarian-born investor fascinates conservatives and right-wing and even left-wing extremists, who blame him for almost every ill facing society and the world.
The billionaire is, according to them, the origin of the various evils shaking society and the world. He is also, according to them, the face of a globalist elite seeking to impose its agenda on the rest of the planet.
Soros Buys More Tesla Shares
In general, Soros is a victim of his daring and profitable financial bets. He became a financial legend after a masterstroke in 1992. On Sept. 16, 1992, the pound sterling collapsed, forcing Great Britain to withdraw from the European Exchange Rate Mechanism. It was called Black Wednesday, aka the 1992 Sterling crisis.
Soros, at the time a currency trader, had bet against the British pound by shorting 10 billion pounds. His bet was based on the fact that the British government’s attempts to support the pound would fail. He launched a public campaign against the pound. And he was proved correct. As a result, Soros is known for “breaking the Bank of England.”
And since then he’s been rumored/suspected/accused of betting against many currencies.
Musk will now have the opportunity to put his question directly to Soros because the legendary investor is becoming a major shareholder in Tesla, the company at the center of the Musk brand.
Soros Fund Management (SFM), the financier’s hedge fund, continued to increase its stake in the electric vehicle maker in the 2022 fourth quarter. SFM held 132,046 Tesla shares as of December 31, according to a regulatory filings. This represented an increase of 42,399 shares compared to September 30th.
What’s interesting to observe is that Soros continued to acquire Tesla shares as the Austin, Texas-based company was suffering a stock market rout. In all, Tesla shares lost 65% of their value last year. Soros did not take into account all these gusts. As of December 31, his stake in Tesla was valued at nearly $16.27 million. In less than two months, the value has increased by more than $11 million to $27.63 million at Tesla’s stock current price of $209.25.
The legendary investor seems to have smelled a good deal once again. Tesla published sparkling results on January 25, with 2022 net profit of $12.6 billion. The group intends to produce up to 2 million vehicles after having manufactured 1.37 million last year. To this good news must be added the beginning of the production late this year of the Cybertruck, the firm’s very first truck/pickup. This vehicle is perceived as the future cash cow as its order book is full and the expectations it arouses are very high.
Soros Has Call Options on Tesla
Soros seems to have anticipated all these events since in addition to the shares he owns he also placed a call option on 200,000 additional Tesla shares, according to the regulatory filings. A call option gives the buyer the right to acquire a certain amount of shares at a certain price in a given time.
The legendary investor first acquired Tesla shares in the second quarter last year. At the time, he held 29,883 shares. He has more than quadrupled his position in six months.
Soros’ investment in Tesla is a sign of confidence in Musk’s strategy and especially in the fact that he believes in the Techno King’s promises to make Tesla a more than $1 trillion market value company.
Stock market regulations require managers of funds with more than $100 million in U.S. equities to file a document, known as a 13F, within 45 days of the end of the quarter, to list their holdings in stocks that trade on U.S. exchanges.
The value of Soros’ U.S. equity portfolio rose by 24% quarter-over-quarter to $7.26 billion. Soros Fund Management is a family office that manages public and private equity.
“SFM invests globally in a wide range of strategies and asset classes, including public equities, fixed income, commodities, foreign exchange, alternative assets and private equity,” the firm says on its website.
Soros, whose net worth is estimated at $8.5 billion as of Feb.14, according to the Bloomberg Billionaires Index, is well known for pouring money into philanthropic efforts. Most of his firm’s assets belong to Open Society Foundations, which supports “people across the world who work for justice, equity and free expression.”