The Psychology of Trust: Why Investors Keep Betting on Musk

Elon Musk’s journey to a $500 billion net worth is a masterclass in the psychology of investor trust. Despite a year of public controversies and market volatility, investors have continued to place their faith—and trillions of dollars—in his vision, a trust that was handsomely rewarded with this week’s historic milestone.
Early 2025 saw this trust tested. Musk’s combative style on his social media platform X, coupled with his political endorsements, led to concerns that he was becoming a liability. For a time, it seemed the “Musk premium” might turn into a “Musk discount” as Tesla’s stock faltered amid fears of brand damage and a distracted CEO.
However, Musk understands that for investors, actions speak louder than words. He countered the negative sentiment with two psychologically powerful moves. First, he allowed his board to signal his renewed, “front and centre” focus on Tesla. Second, he made a massive, public $1 billion bet on himself by purchasing company stock, an act that overwhelmingly restored confidence.
The market’s response was a testament to the deep-seated belief in his ability to deliver. Investors who held their nerve were rewarded as Tesla shares rallied 13% for the year. This surge, backed by the concrete proof of a record 497,099 Q3 deliveries, is what propelled his personal fortune past the half-trillion-dollar mark.
Ultimately, investors trust Musk not because he is conventional, but because he has a track record of achieving the seemingly impossible. His $500 billion valuation is a reflection of the market’s psychological conclusion that betting against him is a far riskier proposition than betting on him.