STOCKS | Scottish Mortgage Trust Exits Tesla and Cuts Its SpaceX Stake

Scottish Mortgage Investment Trust, a major early investor, has sold all its Tesla shares and reduced its SpaceX stake. According to Sina Finance, the Baillie Gifford-managed, London-listed trust disclosed Friday that SpaceX accounted for 11.1% of its assets as of Wednesday, down from 15% on September 30. The trust sold its remaining Tesla shares in April, ending an investment that began in 2013. It first invested in SpaceX in December 2018, when the company was valued at about $31 billion, and had invested about $200 million by 2021. The SpaceX investment helped drive the trust’s net asset value total return to 31.5% in the six months ended September 30, compared with a 16% return for the FTSE Global All Cap Index. The trust’s share-price return was 33.8%, and SpaceX contributed 8 percentage points to the portfolio’s return. After SpaceX’s IPO in June this year, the trust sold some shares as lockup restrictions expired in stages, while saying it remained very positive on the company. It said the decision to reduce its stake while retaining a large holding reflected the importance of disciplined portfolio management alongside strong conviction. The trust also used proceeds from the sales to repay borrowings and reduce leverage.