3 Ways Elon Musk Could Invest His $20 Billion After Selling Tesla Stock

Tesla Inc. TSLA shares crashed on Monday when CEO Elon Musk shocked Twitter TWTR with an unusual proposition: he pledged to unload 10% of his Tesla shares if his followers voted accordingly.

The tweet was a response to Sen. Ron Wyden’s (D-Ore.) proposal to tax the country’s billionaires every year on their stock investments. Given that the U.S. only taxes stock investments when an actual profit or loss is realized, this would fundamentally change how billionaires invest.

Never one to shy away from controversy on Twitter, Musk vehemently opposed the proposal and, on Saturday, asked his nearly 63 million followers:

“Much is made lately of unrealized gains being a means of tax avoidance, so I propose selling 10 percent of my Tesla stock," he wrote. Then, he asked via a poll, “Do you support this?”

10% of his $208 billion in Tesla stock equates to over $20 billion, and currently, Musk is the world's richest man, with a net worth of $338 billion.

No matter what he decides, Musk can completely alter an entire industry by allocating billions. Certain industries will see massive growth and there will be plenty of opportunities to ride that momentum. 

Only Musk knows what his next move is. But, here are the 3 top places he could put his money to work that you may want to keep your eye on.

Ecommerce

Photo: Courtesy of Biz Stone via Flickr

Etsy Inc. ETSY is a personal favorite of Musk’s. This year, he proclaimed on twitter “I kinda love Etsy.” Musk uses the online market place quite frequently, and he’s not the only one. The company serves close to 5 million sellers and over 80 million buyers worldwide. 

In the past 12 months, Etsy stock is up over 112%. Moreover, the stock’s forward price-earnings (P/E) ratio of 77.76 points to a frothy valuation level. 

For this pick of the Elon Musk investments, potential investors might find better value around $230 or even below.

Space Travel

Image by SpaceX-Imagery from Pixabay

Elon Musk always looks towards the future, and in the future he sees space travel being as normal as getting on a transatlantic flight. Elon’s ultimate goal is to facilitate the eventual colonization of Mars. Musk has invested a great deal of his own capital into his aerospace company SpaceX.

In its latest funding round, Venture capitalists invested over $850 million dollars in SpaceX, valuing the company at over $74 billion. But Musk’s celestial darling is still a private company, so you can’t invest in it yet.

Musk has an estimated 48% stake in SpaceX, which is now worth around $100 billion. It’s safe to say that he’s bullish on commercial space travel.

A Finer Alternative

Photo: Courtesy of Masterworks

Despite what you read online, stocks don’t always go up and Musk knows that.

After all, when someone wins a trade, there’s a loser on the other side of it. 

Stocks and cryptocurrencies can be incredibly volatile. 

Fortunately, you don’t always need to take big risks to get big rewards. 

If you want to invest in something with almost no correlation to the wild swings of the stock market, you should check out this overlooked asset — blue-chip art. 

Only ultra-wealthy folks like Musk had the opportunity to invest in blue-chip art by legendary artists like Picasso and Banksy. 

But with a new investment platform, you can invest in the same type of multi-million dollar paintings collected by billionaires like Bill Gates and Jeff Bezos.

According to Citi’s Global Art Market Report, contemporary art prices appreciated 14% annually from 1995-2020, outpacing the 9.5% average return from the S&P 500.

Photo: Courtesy of Daniel Oberhaus via Flickr