Elon Musk's purchase of a 9.1 percent investment in Twitter, as well as a seat on the company's board, has garnered a lot of attention. He also has a $1 billion net worth.
Tesla's CEO revealed the price he paid for the 73 million shares he began buying in late January and finished buying on Friday in a new document released late Tuesday. The price per share averaged $36.16.
Elon Musk Tops Jeff Bezos in Ranking
The revelation of his Twitter investment pushed the stock up 27% on Monday, and another 2% by Tuesday's end, before dropping somewhat in Wednesday trading. Despite the price drop, Elon Musk is still looking at an on-paper profit of $1.1 billion on his $2.6 billion investment. This corresponds to a 40% return on investment. For a two-month investment, it's not bad.
Of course, the sum is just couch change for the world's richest person. Elon Musk's first investment was less than 1% of his estimated net worth of $282 billion, according to Forbes. A profit of $1 billion is described as a rounding mistake.
Elon Musk said on Twitter on Wednesday that he had made an error in his original filing, which claimed he had acquired 73.5 million shares, or 9.2 percent of the firm.
His Tuesday night filing revealed the actual amount of shares: 73.1 million, or a 9.1% ownership. When it was suggested that this meant he had already sold roughly 400,000 of the 73.5 million shares, he stated that the discrepancy was due to a filing error.
To put a $1 billion profit in perspective for someone as wealthy as he is, consider this: the Federal Reserve estimates that the typical household net worth in the United States is $121,700. So, if a normal family's net worth increased by the same rate as Elon Musk's from his Twitter windfall, it would reach $461, as per CNN.
Elon Musk Misleads Investors on Twitter Post
Per Washington Post via MSN, Elon Musk agreed to a consent agreement with the Securities and Exchange Commission in 2018 for allegedly misleading investors when he tweeted that he had raised enough money to take Tesla. Musk agreed to pay a $20 million fine, resign as chairman, and have his tweets reviewed by attorneys. He urged the Securities and Exchange Commission (SEC) to cancel the arrangement last month.
Musk has proceeded to break the rules, asking his Twitter followers in November about whether he should sell a 10% share in Tesla and potentially sway the market.
Musk, the world's richest man with a net worth of $276 billion according to the Bloomberg Billionaires Index, missed the deadline for unknown reasons. For the PayPal co-founder, who now owns and manages rocket firm SpaceX, the earnings of $156 million are a drop in the bucket.
Musk may have filed a false report to the SEC, stating he is a "passive investor" with no intention of changing or influencing control of the firm, in addition to missing the deadline to reveal his position.
Musk should have submitted a separate declaration showing he was an "active investor" if he had intended to join the board or influence the company's decision-making by leveraging the voting power of his stock, according to securities attorneys and finance experts.
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