Tesla’s largest institutional investor is standing by the firm through various scandals. Its managing partner explained to us how the firm decides it’s time to ditch a company.

, Baillie Gifford's joint senior partner and CEO, who has spent his entire career of more than two decades at the firm.

"Sometimes [it's] when they have been successful and start to plateau and the growth is running out, sometimes it's when the business model has proven not to be what we thought it was," Telfer told Business Insider during a recent interview. "And sometimes, it's when management's capital allocation or management style changes so that it's not the management team that we thought it was."

He said that in exercising the discipline to hold a stock, it is important to understand the lopsidedness of returns. One extremely successful investment can make up the losses suffered from a few others, he added. Historical data backs him up. From 1926 to 2016, only 90 companies were responsible for half of the $35 trillion in wealth that US stocks created, according to an Arizona State University research

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