As Tesla stock craters, retail investors are buying near-record amounts of shares
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- Retail investors bought $7.3 billion in Tesla stock over the past two weeks, JPMorgan said.
- The buying behavior signals that retail investors are in "buy the dip" mode as Tesla stock plunges.
- While retail investors are buying, Tesla insiders have sold huge amounts of stock.
Retail investors can't get enough of Tesla, even as the stock undergoes a 50% haircut.
Data from JPMorgan shows that net retail buying of the stock was positive for 12 consecutive days, totaling $7.3 billion.
"While this is not the longest consecutive streak of Retail buying in TSLA, it is the highest magnitude among all past 'buying streaks' in over a decade," Emma Wu, a strategist at JPMorgan said in a note on Wednesday.
JPMorgan
According to Wu, the trading activity suggests that retail investors are still in "buy the dip" mode, seeking opportunities as the broader stock market enters correction territory.
While retail investors are buying up Tesla shares, insiders at the company are selling.
Since November, company insiders, including board directors, the CFO, and Elon Musk's brother, Kimbal, have sold a combined $335.2 million of Tesla stock.
The stock sales occurred mostly at prices between $300 and $400 per share, according to filings made with the SEC. Tesla stock traded at about $242 on Friday.
James Murdoch, a director on Tesla's board, made the most recent insider sale. On March 10, Murdoch sold $12.9 million worth of Tesla stock at about $240 per share.
But at a town hall hosted on Thursday evening, Tesla CEO Elon Musk urged Tesla employees to hold onto their stock despite the recent volatility, which has been sparked in part by an ongoing boycott of the Tesla brand.
"If you read the news, it feels like armageddon. I can't walk past the TV without seeing a Tesla on fire. What's going on?" Musk said on Thursday night, before adding that autonomous driving will unlock Tesla's true value on Wall Street.
"So what I am saying is, 'Hang on to your stock,'" Musk added.