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The big winners from Tesla stock surge: lithium miners and battery makers

January 13, 2021. Summarized by summa-bot.

Compression ratio: 22.2%. 1 min read.

An electric cable runs along the lithium-ion battery of an all-electric Porsche AG Taycan luxury automobile on the production line inside the Porsche AG factory in Stuttgart, Germany, on Thursday, March 5, 2020. Sports-car maker??Porsche AG??intends to offer more green debt to support its 6 billion-euro ($6.6 billion) investment in electric vehicles. Photographer: Krisztian Bocsi/Bloomberg via Getty Images

The incredible stock market surge for Tesla isn't just making Elon Musk and Tesla investors rich. Traders betting on lithium miners and battery makers are also benefiting from Tesla's success.

The Global X Lithium & Battery Tech ETF (LIT), a fund that owns Tesla (TSLA) and other companies in the electric battery business, is up 15% in 2021 and it has soared more than 65% in just the past three months.

The growing global demand for electric cars is helping companies that mine and produce lithium as well as the manufacturers of the lithium-ion batteries that are needed for cars and trucks made by Tesla and its rivals.

Selwood said he has no interest in getting into the more competitive business of making batteries for consumer vehicles, but he said the growing demand for electric cars -- thanks to companies like Tesla -- is helping his firm because that makes it cheaper to produce lithium-ion batteries.

Global X's Palandrani told CNN Business that Tesla deserves a lot of credit for helping to make the electric car business go mainstream with both consumers and investors.

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