Saudi Arabia Covers against Tesla Decline Share
The Saudi Arabia, sovereign wealth fund, has hedged against a decline in the value of the Tesla share. This is reported by business newspaper Financial Times Monday.
The fund has an interest of nearly 5 percent in the American maker of electric cars. It has now signed a deal with investment bank JPMorgan in which it keeps its importance, but the risks of a possible fall in value are covered.
Potential price gains now also have a ceiling. This so-called hedge agreement was concluded on 17 January, according to the newspaper.
The fund’s step is only a few months after Tesla CEO Elon Musk settled with the US stock market watchdog SEC.
The regulator had sued Tesla and Musk for fraud after Musk had informed via Twitter that he wanted to get the company off the stock market at a price of $ 420 per share. According to him, that would be with the support of the state fund.
The timing of his tweets was also striking because the Financial Times had first made mention of the importance of the Saudi State Fund in Tesla a few minutes before the challenged tweets in August. With that, the fund was immediately one of the largest shareholders.