Chamath Palihapitiya revealed that he sold his Tesla position for capital to invest in other investment ideas.
The Social Capital Founder and CEO said that he exited his bet on the Elon Musk-led electric vehicle company “in the last year or so” as the high prices allowed him to generate cash to fund his other ideas.
“I don’t have an infinite pool of capital. So when I have these ideas, the money has to come from somewhere,” Palihapitiya said Wednesday at CNBC’s Delivering Alpha conference.
Palihapitiya told CNBC in January when Tesla was trading around $800 that Tesla was a “distributed energy business” and that the stock could double or even triple again. Tesla closed Wednesday at $781.31.
Tesla was one of the biggest winners in the stock market last year on the back of strong demand for electric cars and investors’ preference towards growth-oriented companies. Shares soared a whopping 743% in 2020. This year, the stock underperformed the broader market with a 10.7% gain year to date.
Palihapitiya said he’s still bullish on Tesla but his thesis on the company has changed a bit. He admitted that he “completely underestimated” how big the EV market could be.
“When you see it now, the market has flipped…Tesla will be very busy just being a best-in-class EV company,” Palihapitiya said.
This post was originally published on CNBC Markets
