Why This Investor is Betting Big on Tesla

Ron Baron, a well-known investor, is staying calm during the recent tech stock downturn. He sees this as a chance to find good deals, rather than a reason to panic. On CNBC's "Squawk Box, " he shared his thoughts, saying he's just looking around to see where the best opportunities are. Baron is particularly confident about Tesla. He admitted that a few years ago, he sold some of Baron Funds' Tesla shares because of pressure from clients and the media. But he made it clear that he personally hasn't sold any of his own Tesla shares. In fact, about 40% of his personal wealth is tied up in Tesla, with another 25% in SpaceX and around 35% in Baron mutual funds. Tesla's stock has dropped 18% from its highest point in the past year. This decline is part of a broader trend where investors are re-evaluating tech stocks, especially those related to artificial intelligence. Despite this, Baron remains optimistic. He's already made about $8 billion from Tesla and believes he could make even more in the next ten years. Baron has a long-term commitment to Tesla and SpaceX. He recalled a promise he made to the board of his mutual funds decades ago. He told them that if they allowed him to invest in public stocks, he would never sell his shares in Tesla or SpaceX. He said, "I will not sell a single share of my shares until my clients sold 100% of their shares. . . . And I don't expect to sell in my lifetime Tesla or SpaceX. " This commitment shows Baron's strong belief in these companies. He's not just talking about it; he's putting his money where his mouth is. While others might be nervous about the tech selloff, Baron sees it as an opportunity to buy more.