Tesla Stock Decline Hits Retail Investors Hard Amid November Rout
Tesla's (TSLA) November slump deepened as shares fell another 2.2% on Thursday, closing at $395.04. Retail traders, who had aggressively bought dips in Tesla, Nvidia (NVDA), and other growth stocks, absorbed most of the losses. The stock is now down 13% for the month and 2% year-to-date.
JPMorgan strategist Arun Jain noted retail investors piled into high-beta names like Nvidia ahead of earnings, only to see gains evaporate in Thursday's reversal. Institutional portfolios remained largely unscathed as small traders bore the brunt of the sell-off.
The damage extended beyond tech, with retail money rotating out of defensive sectors like Health Care and Industrials to chase momentum plays. This pattern echoes cryptocurrency market dynamics where retail traders often amplify volatility.