Billionaire investors George Soros, known for his pledge to invest in zero-emission companies, recently reshuffled his investment portfolio to include several hard-hit electric vehicle stocks. At the same time, he dumped his entire stake in General Motors (GM). The transactions sparked discussions among investors about whether Soros is buying the dip as stock prices slump or if he is adjusting his long-term strategy in the clean energy sector.
Soros’s personal investment office, Soros Fund Management, purchased millions of shares of Nio, Lucid and Rivian in the first quarter, according to a Securities and Exchange Commission filing on May 13. All three companies have seen their stock prices more than halved in 2022 so far amid a market selloff fueled by recession fears.
It was the first time Soros invested in Nio, a Chinese electric vehicle startup, and Lucid, a luxury EV maker based in Newark, Calif. His fund bought about 100 million shares of Nio and 600,000 shares of Lucid during the first quarter, according to the SEC filing. The Soros fund also increased its stake in electric truck maker Rivian and purchased a block of call options that could be converted into roughly 6 million Rivian shares. The filing didn’t specify the price at which Soros has agreed to exercise those options or the contract’s expiration date.
Soros has lost $1.5 billion in his investment in Rivian
Soros already owned about 20 million Rivian shares before the latest transaction. His fund acquired that stake in the fourth quarter of 2021 after Rivian went public, earlier SEC funds show. Rivian’s stock price has plummeted 75 percent since going public, meaning Soros has lost about $1.5 billion on his investment.
Nio and Lucid shares also fell sharply. Nio is down 56 percent this year, and Lucid is down 58 percent.
Also in the first quarter, Soros dumped his fund’s entire stakes in General Motors and Fisker, a Los Angeles-based EV startup, according to the May 13 filing. Soros held 1.26 million GM shares and 317,300 Fisker shares before the transactions.
Currently, Rivian is the largest holding in Soros’s portfolio, which has a 15 percent exposure in electric vehicle companies.
Soros isn’t the only investor seeing an upside in Rivian. On May 17, Morgan Stanley analyst Adam Jonas, who covers the transportation sector, maintained a bullish rating on Rivian stock and set a price target of $60, more than double its market price.
However, Soros’s investing habit suggests his EV bets could just be a short-term play. The average holding period of stocks in Soros’s portfolio is less than nine months, according to Whale Wisdom, a research firm tracking private fund investments. Soros holds on to his top positions a bit longer. The average holding period for the top ten stocks is 3.5 quarters, Whale Wisdom data show.
The 91-year-old investor isn’t so optimistic about the future. At the Davos World Economic Forum this week, he warned of a global depression, and said Russia’s invasion of Ukraine could be looked back on as the starting point of World War III.