Tesla Remains a Significant Holding for The Future Fund Despite Concerns
Despite recent price cuts and concerns over valuation, Tesla Inc. (TSLA) remains a significant holding for The Future Fund, an active ETF managed by Gary Black. While Tesla has been a top performer for the fund since its launch in August 2021, Black revealed that The Future Fund has reduced its position in Tesla from 12.2% in October 2022 to 4.6% as of November 8. This decision comes as Tesla’s fiscal year 2025 earnings estimates declined by 59%, leading to underperformance against the Nasdaq 100 index.
Black, known for his measured approach to Tesla investment, acknowledged these concerns on X, stating, “We don’t sugarcoat the negatives, and remain highly disciplined about valuation.” He also expressed a cautious stance until Tesla’s robotaxi technology proves viable. Despite the reduced position, Tesla still ranks among the top performers for The Future Fund in 2024. NVIDIA Corp (NVDA) leads the pack with a 198% gain, followed by Alphabet Inc (GOOGL GOOG) at 28%, Eli Lilly and Company (LLY) at 43%, Salesforce Inc (CRM) at 22%, Netflix Inc (NFLX) at 63%, and Tesla at 29%. The fund’s strategic approach to position sizing is based on a target 2:1 upside/downside ratio, emphasizing a balanced analysis to inform investor decisions.
Black’s communication style has occasionally sparked friction with some Tesla bulls, but he advocates for constructive criticism within the investment community, emphasizing that “We call things how we see them — both good and bad — and that’s why some bulls in the $TSLA community don’t like us.” Despite recent challenges, Tesla remains a significant player in the electric vehicle market, with its stock seeing a 49.65% increase over the past year. However, Tesla’s EV technology has recently come under scrutiny. The National Highway Traffic Safety Administration (NHTSA) has expressed concerns over Tesla’s social media promotion of its Full Self Driving technology, which depicts disengaged driver behavior. Meanwhile, Tesla’s future plans, such as the construction of a Gigafactory in Mexico, could be affected by the recent U.S. presidential election results. Despite these challenges, Tesla’s market cap has soared above $1 trillion, propelling Elon Musk’s wealth to over $300 billion.
Tesla’s stock performance:
* Tesla’s stock closed at $321.22 on Friday, up 8.19% for the day.
* In after-hours trading, it rose an additional 0.49%.
* Year-to-date, Tesla’s stock has climbed by 29.31%.
