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(Reuters) -Tesla Inc said on Wednesday that Chief Executive Elon Musk sold some of his stake in the electric car maker to satisfy tax obligations related to exercising stock options.
The electric car maker’s stock rose 2% after the bell on the news, helping to offset a multiday sell-off that had endangered the company’s position in the $1 trillion club.
Musk on Saturday polled Twitter (NYSE:TWTR) users https://www.reuters.com/technology/musk-asks-followers-twitter-whether-he-should-sell-10-his-tesla-stock-2021-11-06 about selling 10% of his stake, setting off worries that such a sale could hurt Tesla (NASDAQ:TSLA)’s share price. In Wednesday’s trading session Tesla recovered 4.3% to $1,067.95.
In its filing, Tesla said Musk sold shares on Monday to satisfy tax withholding obligations related to exercising stock options to purchase 2,154,572 shares.
While Tesla has lost close to $150 billion in market value this week, retail investors have been net buyers of the stock. Some 58% of Tesla trade orders on Fidelity’s brokerage website on Wednesday have been for purchases, rather than sales.
Retail investors made net purchases of $157 million on Monday and Tuesday, according to Vanda (NASDAQ:VNDA) Research.
Tesla is now up more than 51% in 2021, thanks largely to an October rally that was fueled by an agreement to sell 100,000 vehicles to rental car company Hertz.
“The company itself is on fire, with strong results,” said Tim Ghriskey, a senior portfolio strategist at New York-based investment management firm Ingalls and Snyder. “That is not going to fade quickly.”
Bullish sentiment returned to Tesla’s options on Wednesday, with about 1.1 calls traded for every put. Calls are typically used for bullish trades, while buying puts shows a bearish bias.
The company’s options accounted for about $109 billion in premium changing hands over the last two weeks, or about one in every three dollars traded in the U.S.-listed options market, according to a Reuters analysis of Trade Alert data.
