Telegraph Money’s Millennial Investor Imogen Tew, 28, has a new baby and hopes to buy a bigger house. After years of neglecting her portfolio, she needs help to become a better investor. Can you offer her any words of wisdom?
As part of a “new year, new me” review of my finances, I went down a rabbit hole looking at how much I might have made had I risked my whole portfolio on a single stock.
Today’s £12,000 pot would be more like £15,000 if I’d backed Microsoft, a painful £4,000 if I’d opted for Alibaba and a modest £11,500 if Lloyds Bank had been my stock pick.
Had Tesla taken all my cash, however, I’d have more than £18,000. The electric car manufacturer has returned about 80pc since I started investing – and a whopping 1,140pc in the past five years. By comparison, my portfolio is up a mere 16pc since July 2021.
Tesla certainly isn’t running out of steam when it comes to new ideas, with promises of the Optimus Robot and self-driving cars in the next few years. Despite the grand plans, I err on the side of caution for one main reason: its divisive boss, Elon Musk.
Musk has dominated UK headlines recently thanks to his plotting to oust Prime Minister Keir Starmer and the rumours that he may donate millions to Reform UK at the next general election – although his rift with Nigel Farage may have dampened such a move.
Regardless of your politics, as an investor, it’s cause for concern for a few reasons.
Firstly, there is the simple question of how Musk can do it all. He is running Tesla, running his space technology company, SpaceX, running the social media platform X (formerly Twitter), is set to co-chair the new “Department of Government Efficiency” in President-elect Donald Trump’s incoming administration – and now, he’s dabbling in European politics, too. How does he have the time?
One rather funny theory about his latest obsession with the UK and Europe is that he wakes up very early in the morning and spends time on “X”. There’s no US news at that time, so he’s simply getting worked up about what is in front of him – I imagine it’s a little more thought-through, however.
Then there is the more serious worry about his general suitability as chief executive from an investor’s perspective.
Let’s look at the history. In 2018, he tweeted that he had the funding to take Tesla private at $420 (£342) a share (a substantial premium on the share price at the time), and that the move hung on a shareholder vote.
The US Securities and Exchange Commission said the tweet was misleading and caused Tesla’s share price to jump 6pc – so he was fined. In 2020, he posted that, in his opinion, Tesla was overpriced and the share price fell about 10pc.
