Tesla Motors (TSLA) has captured the imagination of customers and investors alike with its line of electric vehicles. The company was founded in 2003 and is headquartered in Austin Texas. Through a series of production delays, lawsuits, and tweets by co-founder and chief executive officer (CEO) Elon Musk, the company has taken investors along for a rollercoaster ride.
The company had a market capitalization of $740.14 billion and the stock closed at about $234 on Aug. 22, 2023. There were just over 3.17 billion shares outstanding as of that date. But who are the largest shareholders of Tesla? The following are the three largest mutual funds invested that are invested in the company. All figures are current as of August 2023 according to Morningstar unless indicated otherwise.
Key Takeaways
- Tesla is a well-known electric vehicle company founded in 2003 by a group of engineers and business people and led by CEO Elon Musk.
- Investors can invest in Tesla directly by buying shares in the company or indirectly through mutual funds.
- The three mutual funds that hold the most Tesla shares are offered by Vanguard.
Vanguard Total Stock Market Index Fund Investor Shares (VTSMX)
The Vanguard Total Stock Market Index Fund Investor Shares (VTSMX) is the mutual fund with the largest Tesla holding. It had about 83.91 million shares in its portfolio. This represents 2.64% of Tesla shares and 1.60% of the fund's total assets.
VTSAX had $1.4 trillion in assets under management (AUM) as of July 31, 2023, and invests in equity securities of large-, mid-, and small-cap U.S.-based companies across both growth and value investing styles. The expense ratio is 0.14%.
Established in April 1992, the fund's primary objective is to track the performance of its benchmark index, the Spliced Total Stock Market Index. It has virtually mimicked the returns of the index since its inception. The fund returned 11.19% over a five-year period.
Tesla went public on June 29, 2010, and trades on the Nasdaq.
Vanguard Institutional Total Stock Market Index Fund (VITNX)
Another Vanguard fund makes the list of top holders of Tesla. The firm's Institutional Total Stock Market Index Fund (VITNX) is the second-largest fund invested in the electric car company. Morningstar recorded roughly 83.28 million shares, making up 1.39% of the fund's portfolio. This represents 2.62% of all Tesla shares.
The fund, which was established on Aug. 31, 2001, is only open to institutional investors, as it requires a minimum investment of $5 million. With an expense ratio of 0.03%, VITNX had $1.1 billion in AUM. It aims to mimic the returns of its benchmark, the Spliced Institutional Total Stock Market Index. The fund has performed in line with the benchmark, returning 11.38% over a five-year period.
The Vanguard 500 Index Fund Investor Shares (VFINX)
The third-largest mutual fund with Tesla in its portfolio is another Vanguard fund: the Vanguard 500 Index Fund Investor Shares (VFIAX). This fund held about 64.52 million Tesla shares, which accounts for 2.03% of the company's shares. Tesla made up 1.87% of VFIAX's holdings.
Vanguard launched the fund on Aug. 31, 1976. It has an expense ratio of 0.14% and a total of $921.4 billion in AUM as of July 31, 2023. The fund attempts to mimic and has closely matched the returns of the S&P 500. The five-year return for the fund was 12.15% as of June 30, 2023.
How Can I Invest in Tesla?
There are several ways you can invest in Tesla. You can buy shares through your broker through the secondary market or stock exchange. You can also invest in the company indirectly by purchasing shares of a mutual fund that holds Tesla in its portfolio. The company is also a component of a number of exchange-traded funds (ETFs), which trade on exchanges just like stocks.
Are Vanguard Mutual Funds Good Investments?
The answer to this question depends entirely on your goals, time horizon, and capital among other things. But Vanguard generally has a good reputation and below or average expense ratios, which means its funds aren't nearly as expensive as others on the market. Just remember, though, that you should do your due diligence and research before making any decisions about your financial or investment portfolio.
How Do Mutual Funds Work?
Mutual funds are investments that pool money from multiple investors with the same goals and invest them in multiple securities, such as stocks, bonds, and ETFs. One share of a mutual fund gives investors a fraction of ownership in the securities held in the portfolio. Assets are held in the fund and managed by a fund manager using active or passive investment strategies. Fund companies charge an expense ratio as compensation for managing the investment. Portfolios and holdings are adjusted as frequently as the manager sets out in the fund's prospectus.
The Bottom Line
Founded in 2003, Tesla started out as an electric car maker but has since expanded. It now designs and manufactures energy products, including solar panels. As an investor, you may be interested in knowing how to get a stake in the company and share in its growth. You may want to buy shares directly in the company or make indirect investments through ETFs and/or mutual funds that hold the company in their portfolios. Vanguard is one of the top institutional investors, with three of its funds holding the most Tesla shares of all mutual funds. Regardless of the option(s) you choose, make sure you do your research to ensure that your investments align with your financial situation and goals.
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