Korean investors holding some $8 billion worth of stocks in US electric vehicle maker Tesla appear to be unnerved after its recent stock price fall.

According to the latest data from the Korea Securities Depository, Tesla was Korea‘s favorite foreign stock, holding a combined $8.1 billion worth of shares as of March 2. This was followed by US tech giants Apple, Amazon and Alphabet, the holding company of Google.

In the past two months, Korean investors net bought $1.36 billion worth of Tesla shares, also the largest among foreign stocks followed by US-listed Apple, Palantir Technologies and Taiwan Semiconductor Manufacturing Co., riding on the upsurge in stock price.

Tesla has been Korean investors‘ most-owned foreign shares by stock valuation since the end of June 2020, outstripping that of Amazon. Through the second half of 2020, Tesla’s share price jumped over threefold to $705.70.

Earlier in 2021, Tesla shares gained more attention from traders worldwide as the Nasdaq-listed EV maker became a constituent of Wall Street’s broad-based S&P 500 index in December, signaling fresh inflow of equity investment. The company also recorded an operating profit for the fifth consecutive quarter by September 2020. The investor sentiment toward Tesla drove its share price up to nearly $900 in late January.

But equity investors are now bracing for a stress of Tesla‘s daily fluctuations. Tesla is now below the $600 mark, closing at $597.95 per share on Friday, more than 32 percent lower than its peak. It was the lowest since Dec. 10.

This stems from a combination of investors’ appetite for US bonds as the US 10-year Treasury yield hit the highest of 2021 at 1.62 percent during intraday trading, as well as projections that Tesla will no longer dominate the EV market in the US as carmaker rivals usher in EV production. Tesla has also reportedly experienced a temporary shortage of batteries and semiconductors, affecting its production capacity.

“Tesla‘s stock price continues to fall, invoking investor fears,” wrote Han Byung-hwa, an analyst at Eugene Investment & Securities, in a note Monday. “The top dog‘s exposure to competition is weighing on its current stock valuation.”

Han added Tesla’s EV market share in the US, which stood at 70.2 percent in 2020, is estimated to be on a gradual decline to below 40 percent in 2025.

By Son Ji-hyoung (consnow@heraldcorp.com)