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Funds in Korea cut their investments in Tesla, instead relocating to Chinese rivals

Funds in Korea cut their investments in Tesla, instead relocating to Chinese rivals

(Bloomberg) — South Korea’s first mutual fund dedicated to investing in the electronic-vehicle industry has slashed its exposure to Tesla Inc. to its lowest level ever, moving money to its Chinese rivals.

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The Korea Investment Management Company Fund, a Tesla holder since inception in 2017, has reduced its exposure to the US carmaker to less than 3% of its net asset value this year, down from a high of 9% in the past. Is.

Hwang Woo-taek, who manages the fund’s 1.15 trillion won ($887 million) assets, said in an interview, “We sought to reduce volatility in the portfolio by reducing our exposure to stocks and taking profits from our top holdings.” “

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Some of the outflow from Elon Musk’s firm has trickled down to China’s EV makers, with Korean funds adding names including BYD Co and Xping Inc after “extreme declines” in March and April, Hwang said. It has also raised stake in EV supply-chain stock ABB Ltd and US-based Eaton Corp in Switzerland and lifted its cash holdings.

Riding Tesla’s long-term success, the fund has outperformed 98% of its peers over the past three years, but lost 20% so far in 2022. Hwang said he is looking forward to more innovation from Tesla, such as the launch Cybertruck, before buying more.

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Funds in Korea cut their investments in Tesla, instead relocating to Chinese rivals

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