I Bought $1 Million of Tesla Stock (TSLA), Here’s Why

The speaker invested $1 million in Tesla stock (TSLA) due to anticipated favorable regulations, a bullish tech market in 2025, and the belief that Tesla's market cap will reach $2 trillion by 2025. The speaker discusses his reasoning, including the potential impact of Elon Musk's relationship with Donald Trump, a dovish Fed, and the potential for analysts to revise price targets upwards, as well as the benefits of using leap options for investors.

Tesla Stock Investment

• 00:00:05 The speaker invested $1 million in Tesla stock, buying 3,000 shares at $332 per share, based on his belief that the stock will reach $500 per share in 2025. He highlights that he's already up $36,960 on the investment, indicating a positive early return. The speaker also emphasizes that it's not necessary to have a large portfolio to invest in Tesla and considers this a big bet in his higher-risk portfolio that he typically reserves for six- and seven-figure investors.

Favorable Regulations

• 00:00:28 The speaker believes that Tesla will benefit from improved regulations due to Elon Musk's relationship with Donald Trump. He suggests that this could lead to more favorable policies on manufacturing, innovation, and overall economic growth, including potential tax incentives and corporate tax reductions. The speaker asserts that these regulatory changes could positively impact Tesla's revenue and profitability.

Bullish Tech Market

• 00:01:28 Dan Ives, a market analyst, anticipates a bull run in the tech sector in 2025 and 2026, and the speaker agrees with his assessment on the regulatory aspect. This bullish sentiment stems from a dovish Fed, leading to lower interest rates, which allows tech companies to hire more workers, raise more money, and take advantage of cheap debt to fuel growth. The speaker believes these factors will positively impact the tech sector, including Tesla.

Analyst Price Target Revisions

• 00:08:21 The speaker, drawing on his Wall Street experience, states that analysts are likely to revise Tesla's price targets upward. However, he suggests this is not necessarily due to the stock's inherent quality but because analysts feel pressured to adjust their predictions as the stock rises. Analysts, potentially feeling 'stupid' for having low price targets, tend to copy each other and revise their targets upwards, which can create a positive feedback loop for Tesla's stock price.

Dollar-Cost Averaging

• 00:09:32 The speaker advocates for dollar-cost averaging, explaining his own decision to add $1 million to his Tesla position as a continuation of this strategy. He mentions that his parents, who initially bought Tesla at a higher price and hesitated to dollar-cost average further, now regret not doing so as the stock has rebounded. He acknowledges the potential for market pullbacks but emphasizes that investors should take advantage of favorable market conditions to maximize their returns.