To The Moon

Tesla stock split day finally came! After the U.S. stock market closed on August 24, $Tesla Motors(TSLA)$ 1 share split 3 shares of the stock split transaction officially effective.

Tesla's historical stock price performance for the stock split

According to Tesla's previous filings with the SEC, shareholders of record on Aug. 17, 2022, will receive two additional shares of post-split common stock for each share of common stock they own after the close of business on Aug. 24, and will begin trading on Thursday (Aug. 25) on the basis of the post-split share price. In simple terms, if an investor owned 100 shares of Tesla stock before the split, he or she will own 300 shares after the split and the new share price will be one-third of the original share price.

First stock split

Although the stock split itself will not change the value of the company, it will make Tesla's stock more affordable and enhance stock liquidity. This stock split is the second stock split for Tesla, which announced its first stock split since its IPO on Aug. 11, 2020 - a 1-share split of 5 shares. Under this stock split, Tesla shareholders of record on August 21, 2020 benefit from this program, which became effective on August 31, 2020.

Specifically, Tesla shares closed down 3.11% at $274.88 per share on Aug. 11, the day the split was announced, while Tesla rose about 61% during the period from the announcement to the day before the split took effect. Tesla jumped 12.57% on the effective date, and according to VandaTrack data, net investor buying reached $209.3 million that day, compared to $156.5 million the previous trading day.

Second stock split

Tesla announced another stock split this year, as early as March 28, Tesla announced on Twitter that it would carry out a 1 for 3 stock split plan, although it did not indicate when it would take effect at the time, and the stock price jumped 8.03% that day. Later, on August 12 EST, Tesla filed a document with the SEC to determine that the 1 for 3 stock split would take effect after the bell on August 24, and the stock price closed up 4.68% on that day.

According to Dow Jones, from 2012 to 2021, S&P 500 constituents' share prices rose by an average of about 12% in the year following the stock split.

Today is the day the stock split officially takes effect, and by historical records, Tesla shares are likely to see big swings today. Now, the Korean investors, who have always been known for their craziness, are already eyeing Tesla.

After first stock split

Global investors are the second largest shareholders of Tesla

Korean investors have been betting wildly on Tesla stock. Especially during the pandemic, Korean investors hoping to gain access to the wealth code have flocked to Tesla shares, increasing their total holdings more than 100 times and valued at more than $15 billion, making them one of Tesla's key shareholders.

According to data from the Korea Depository & Clearing Corporation (KSD), as of Aug. 17 local time, local investors in South Korea had an overall stake of about 1.6% in Tesla Inc.

Given that there are Koreans who hold Tesla directly in the U.S. market, the actual percentage may be higher than 1.6%. The data also shows that Tesla is currently the favorite of Korean investors, with holdings exceeding the country's total retail investments in $Alphabet(GOOGL)$, $Apple(AAPL)$, $Microsoft(MSFT)$ and $NVIDIA Corp(NVDA)$.

Giacomo Pierantoni, head of data at Vanda Research, a research firm that tracks transactions, estimates that global investors, excluding Larry Ellison, own a total of about 14.5% of the company. This means that the total shareholding of global investors including Korean investors (about 14.5%) has become the second largest shareholder of Tesla after Musk himself (about 14.8%).

Tesla has become the hope of struggling Korean investors as prices in the Seoul metropolitan area have more than doubled in the past five years. Their adoration of Musk borders on fanaticism and they call themselves "Teslams," a hybrid of "Tesla" and "Islam," implying that Tesla is their way of life. This is a mixture of Tesla and Islam, meaning that Tesla is their faith.

One of the Teslams in Seoul, South Korea, was interviewed by the media, and Sung-Hyun Park, 40, said she and her husband sold their house moved into a rental apartment with their 7-year-old son, and invested $230,000 of the family's savings in Tesla stock.

Park Sung-hyun said the stock was priced at $668 when she purchased Tesla, and the latest price has gone to near $890. Both she and her husband see Musk as a visionary who can successfully continue to influence change in the auto industry, "He's doing things no one thought of before, and I think we can bet all in on this guy (Musk)." With an estimated $668 Tesla shares, Ms. Park holds about 344 shares of Tesla, and based on Tesla's closing price of $891 last night, Ms. Park has made about $76,700.

In addition to Park Sung Hyun who sold her house to speculate on stocks, there is also Sun Gil Hong who speculated on stocks in order to buy Tesla cars. Sun Gil Hong puts half of $2,000 monthly salary ($1,000) into the stock, and his total investment has now reached about $100,000. In June, when Tesla fell below $700, he decisively cut his position in Korean stocks and increased his holdings in Tesla. Sun Gil Hong's immediate goal is to buy a Tesla car, and his long-term goal is to buy a house.

Musk is recently selling a lot of Tesla shares for the acquisition of Twitter, causing the stock to move lower. Although Sun Gil Hong does not quite support Musk's approach, he still understands it; Park Sung Hyun's family is more angry, but still says they have not lost confidence in Tesla.

One World One Dream!

Will Korean retail investors' dreams of riches be fulfilled by $Tesla (TSLA)$? Can Tesla repeat the miracle of stock split?

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