Few companies capture the spirit of innovation as it exists today as Tesla (TSLA), the California-based maker of electric cars, advanced battery systems, solar panels and other world-changing inventions. Founded in 2003 by engineers Martin Eberhard and Marc Tarpenning, Tesla was soon thereafter joined by current CEO Elon Musk, who invested in the company’s Series A round.

And the rest is history.

As of 2019, Tesla is producing three models of its all-electric vehicles — the Model S liftback sedan, the Model X SUV, and the Model 3 affordable sedan — and has new versions in development including the Model 3 crossover SUV, Roadster sports car and the Semi battery powered Class 8 semi-trailer truck. The company also produces solar panels and solar roof tiles via its SolarCity subsidiary, as well as whole-home rechargeable lithium ion battery systems the Powerwall and Powerpack and the Megapack, a Lithium-ion grid energy storage battery.

As of 2018, Telsa controlled 12% of the global market for plug-in electric passenger cars, with more than 245,000 vehicles delivered, making it the world’s best selling builder in its category.

Rationale

A direct way to gain exposure to Tesla is to buy the listed shares. However, this can be a volatile approach, given the company’s early stage and ongoing growing pains. A solution that can dampen some of that volatility is to buy funds that provide exposure to Tesla and other similar firms, rather than TSLA shares themselves. After all, the return drivers that will benefit Tesla might also benefit other similar firms in their industry, including those making electric vehicles as well as components and infrastructure for the industry. 

As investment management is gradually moving to the construction of portfolios using ETFs and mutual funds in addition to single stocks, investors would do well to consider gain exposure to firms like Tesla through these types of funds.

Investing in TSLA

A search on Magnifi suggests that investors can gain access to Tesla via a number of different funds and ETFs, including those shown below. 

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