
Investing in Tesla ETFs can be a smart move, especially for those who believe in the electric vehicle revolution.
Tesla is a leader in the electric vehicle market, with a market capitalization of over $1 trillion.
To invest in Tesla ETFs, you'll need to choose a brokerage account that offers low fees and a wide range of ETF options.
Some popular brokerage accounts for investing in Tesla ETFs include Fidelity, Charles Schwab, and Robinhood.
Investing in Tesla ETFs
The VanEck Vectors Low Carbon Energy ETF (SMOG) has Tesla as its top-weighted allocation, accounting for 14.21% of its portfolio.
This ETF is a great option for investors who want to invest in low carbon energy companies, and it's also a convenient way to gain exposure to Tesla.
The fund has a five-year annualized return of 10.73% and a three-year annualized return of 16.02% as of Sept. 2020.
Tesla is also a top holding in the Consumer Discretionary Select Sector Fund, making up 16.2% of the fund's portfolio.
This fund is a great option for investors who want to invest in a mix of consumer discretionary stocks, including Amazon and Tesla.
The Ark Innovation ETF, on the other hand, invests heavily in Tesla, with a 10.2% stake in the company.
However, this ETF is not for the faint of heart, as it's invested in high-risk stocks with high potential reward, and it has a high expense ratio of 0.75%.
Investors who are willing to take on the risk may find this ETF to be a good option, but it's essential to do your research and consider your risk tolerance before investing.
The Consumer Discretionary Select Sector Fund has a low expense ratio of 0.1%, making it a more cost-effective option for investors.
This fund is also a great option for investors who want to gain exposure to Amazon and Tesla, as these two companies make up a significant portion of the fund's portfolio.
Understanding Tesla ETFs
The Tesla ETFs we'll be discussing have a focus on the electric vehicle and clean energy industries, with Tesla being a key holding in many of these funds.
One example is the TSLR fund, which seeks daily investment results of 2 times (200%) the daily percentage change of Tesla's common stock. Another example is the ARK Industrial Innovation ETF (ARKQ), which invests in companies that benefit from automation or technological innovation, with Tesla being its top allocation at 9.5%.
The TSLR fund has around $14 billion in net assets, which allows it to have a low expense ratio of 0.1%. This is a significant advantage for investors, as it means they can keep more of their investment returns.
Here are some key facts about the TSLR fund:
These ETFs offer investors a way to gain exposure to the electric vehicle and clean energy industries, with Tesla being a key holding in many of these funds.
VanEck Vectors Low Carbon Energy ETF
The VanEck Vectors Low Carbon Energy ETF, also known as SMOG, is a great option for investors looking to tap into the growing alternative energy sector.
Launched in 2007, this ETF has a long history of providing investors with exposure to low-carbon energy companies.
The fund's top-weighted allocation is Tesla, which accounts for 14.21% of its portfolio, giving investors a significant stake in the electric car maker.
Other top holdings in the fund include Vestas Wind Systems A/S and Eaton Corporation PLC.
The VanEck Vectors Low Carbon Energy ETF charges an annual management fee of 0.62%, which is relatively low compared to other ETFs in the market.
As of September 2020, the fund has a five-year annualized return of 10.73% and a three-year annualized return of 16.02%, making it a solid option for long-term investors.
The fund's net assets total $142.6 million, and it has a 30-day SEC yield of 0.20%.
Fund Objective
The fund objective of a Tesla ETF is to track the daily performance of Tesla Inc's common stock. The goal is to match the daily percentage change of TSLA, before fees and expenses, exactly.
This means that if TSLA has a good day, the fund aims to double that gain. There's no guarantee, however, that the fund will meet its stated objective.
The fund is designed to provide a 2 times return on the daily percentage change of TSLA, not a 2 times cumulative return over longer periods. This is an important distinction, and it's essential to understand that the fund's performance may not be consistent over time.
The fund's exposure to Tesla's common stock is subject to change, which means the fund's holdings and strategy may shift over time. This can affect the fund's performance and risk profile.
Underlying Stock: TSLA
Tesla, Inc. (TSLA) is a company that designs, develops, manufactures, leases, and sells electric vehicles, energy generation and storage systems in the United States, China, and internationally.
The company operates in two segments: automotive and energy generation and storage.
TSLA has a significant presence in the market, with a large market capitalization and a dominant position in the electric vehicle industry.
As of September 2020, Tesla's top three holdings in the ARK Industrial Innovation ETF (ARKQ) are Materialise NV (MTLS), 2U Inc. (TWOU), and Tesla itself at 9.5%.
The company's energy generation and storage segment includes products such as the Powerwall and the Solar Roof, which are designed to provide clean energy to homes and businesses.
Tesla's top-weighted allocation in the VanEck Vectors Low Carbon Energy ETF (SMOG) accounts for 14.21% of the fund's portfolio, giving investors ample exposure to the electric car maker.
Key Information
The performance of a Tesla ETF is a crucial aspect to consider.
The data provided is on a total return basis, which takes into account both income and capital gains.
Here are some key statistics:
The fund's goal was to track the daily percentage change of Tesla Inc's common stock, with a target of 1.75 times the daily return.
Investment Options
If you're looking to invest in Tesla through an ETF, there are three different funds to consider. Each fund offers a unique way to invest in the EV maker.
The Consumer Discretionary Select Sector SPDR Fund invests in companies that have a similar size, market dominance, and brand power as Tesla, even if they serve completely different industries. This can be a good fit for risk-averse investors.
The Clean Edge Green Energy fund invests in companies that are addressing similar challenges as Tesla is, making it a good choice for those specifically interested in clean energy.
The Ark Innovation ETF is best for those that want stocks like Tesla, not necessarily companies like Tesla.
Frequently Asked Questions
What is 3x Tesla ETF?
The 3x Tesla ETF is an investment product that aims to provide three times the daily performance of Tesla Inc. stock. It's designed for investors seeking to amplify their exposure to the electric vehicle leader.
What is 2x Tesla ETF?
The 2x Tesla ETF is a daily leveraged investment fund that aims to provide twice the inverse daily performance of Tesla's stock. It's designed for short-term trading and offers a high-risk, high-reward opportunity to profit from Tesla's daily market movements.
Is there an inverse Tesla ETF?
Yes, there is an inverse Tesla ETF, specifically the AXS Daily Bear Tesla ETF (TSLQ), which provides inverse exposure to Tesla's daily price movement.
Sources
- https://graniteshares.com/institutional/us/en-us/etfs/tslr/
- https://www.tradretfs.com/tslw-1.5x-long-tsla-weekly-etf
- https://www.investopedia.com/news/3-etfs-tesla-drives/
- https://www.fool.com/investing/2023/04/02/these-3-top-etfs-give-you-tesla-and-so-much-more/
- https://www.tipranks.com/news/article/invest-in-tsla-stock-with-these-4-etfs
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