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  • If people arent covering their shorts their brokers are doing it for them. To that end, some chatter says that some of the drive is a bunch of calls that were sold, thus driving a bunch of stock purchases to cover potential losses, rinse/repeat. So options seem to be also adding fuel to the fire, did see a shot of 4000 buys on robin hood yesterday.

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    • Again, I don't normally buy individual stocks, but I bought Tesla a decade ago when I put down a deposit and then waited years for my first Model S. It reminds me of the late 80s when I felt the same way about Apple, when I bought my Mac SE with 1 MB of RAM and a 20 MB hard drive for $2900, and then there was that period of down years where Apple almost went broke.

      Is it time to cash out my Tesla stock and go back to my boring index funds? I am old enough to know that no one knows how this will end.

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      • Some people are saying "I told you so" right now. Different people might be saying it later. We will see.

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        • Originally posted by White.Beard.Doc View Post
          Again, I don't normally buy individual stocks, but I bought Tesla a decade ago when I put down a deposit and then waited years for my first Model S. It reminds me of the late 80s when I felt the same way about Apple, when I bought my Mac SE with 1 MB of RAM and a 20 MB hard drive for $2900, and then there was that period of down years where Apple almost went broke.

          Is it time to cash out my Tesla stock and go back to my boring index funds? I am old enough to know that no one knows how this will end.
          Its not that hard to know how the short term will end. It will go up until all shorts cover (maybe lots more, who knows) and then it will go down, similarly fast. To what stop who knows, but things dont run up like this and chill.

          This is basically a slower version of VW. Its not normal and its not due to any news, its technical and liquidity driven. I'd be taking profits if I werent so cheap. Looked at calls yesterday that were ridiculously out of the money, and they were super expensive, but they were literally up 1200% this morning, thats nuts. I did not buy OFC, since im not crazy/smart enough.

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          • It’s interesting. Reddit thinking that some large bear dumped 1M shares in order to trigger stop losses and manipulate price. Recovered a bit in ah.

            It’s going to be a wild one

            edit. Also read somewhere else that we may not see a typical short squeeze with Tesla.
            —-
            But that might not happen for Tesla, according to Ihor Dusaniwsky, the managing director of predictive analytics at S3.

            "It is more likely to be a continuous slow decline in shares shorted rather than a sudden abrupt plunge," he wrote in a note Monday. "This is due to the amount of short hedging that is being done to offset Tesla convertible bond and option exposure."

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            • Originally posted by Jaqen Haghar MD View Post

              Really? Large funds with experienced money managers and veteran traders chasing a parabolic run up like it’s never going to have a dip again? This is classic amateur behavior. But who knows? It is super interesting.

              I will say congrats though. If I owned a big position, I’d be out in the middle of the street, giggling, doing an Irish jig like some sort of drunken leprechaun.
              No way this is retail. I watched order when the stock was flying up and they were all 100-1000 share per order. And there have been multiple streams >10 million volume in short time over last two day, which suggests it is not short squeeze. If a fund or multiple funds buying millions of shares that is what I imagine it would look like.

              I started my exit from my Jun expiration calls today late afternoon; >> year salary return cashed in and much more to go.
              RE: drunken leprechaun. I am more stressed than excited. NW is now where I expected to be in 8 years. Lots of tax implications. Change in student loan strategy. A lot to take in from diddling on my cell phone while waiting for elevator.

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              • Originally posted by BCBiker View Post

                No way this is retail. I watched order when the stock was flying up and they were all 100-1000 share per order. And there have been multiple streams >10 million volume in short time over last two day, which suggests it is not short squeeze. If a fund or multiple funds buying millions of shares that is what I imagine it would look like.

                I started my exit from my Jun expiration calls today late afternoon; >> year salary return cashed in and much more to go.
                RE: drunken leprechaun. I am more stressed than excited. NW is now where I expected to be in 8 years. Lots of tax implications. Change in student loan strategy. A lot to take in from diddling on my cell phone while waiting for elevator.
                Nice work. Is this in a tax protected account? That would be awesome if so, no big deal if not.

                This is a text book short squeeze. Yes there are other rabid buyers chasing, as well as algos and hfts, and market makers and large positions short calls that have to hedge their positions. This all goes the same way and entices others to increase their exposure, and makes even more shorts (god rest their souls) have to cover. Its a vicious cycle at this point.

                Its a perfect storm. This is a low float stock (21% insiders, 57% institutions, and 20+% WAS short) insiders and institutions are not usual big sellers, so any retail or small funds buying could easily cause it to go up, make a short cover, etc....there is a long tradition of selling the tesla calls as the share price has gone no where prior to this recent move for years and the IV was always so high.

                You know the person/persons/market maker who sold you those calls is literally out all that money you made? So how do they protect themselves? They either buy the stock outright or buy the calls back. Market makers may buy the stock to hedge, exacerbating the move, if someone gets margin called by their broker which is likely given the size of the moves, theyre just out the money. Unsure how much in house hedging if any is done by brokerages. So I can see it basically being a bunch of buyers making everyone have to buy.

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                • Anyone remember Elon talking about Saudi Arabia funding commitments?
                  ”The fund held more than 8.2 million shares by the end of the third quarter of 2019”
                  Virtually all gone by the end of 4Q. The Saudi Arabia Public Investment Fund is a very big deal with every imaginable resource and investment tool available. Strategic decision, timing off by a month. I can guarantee some darkpools and diversified block trades were involved.
                  You don’t place a sell order at a market limit and wait for open bids for 8 million shares. It could (more likely did) artificially raise December selling pressures.

                  https://www.cnbc.com/2020/02/04/saud...ing-shows.html
                  Who knows if some “big dog” is buying now. Won’t know until March public filings. Just a tidbit.

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                  • Originally posted by Zaphod View Post

                    Nice work. Is this in a tax protected account? That would be awesome if so, no big deal if not.

                    This is a text book short squeeze. Yes there are other rabid buyers chasing, as well as algos and hfts, and market makers and large positions short calls that have to hedge their positions. This all goes the same way and entices others to increase their exposure, and makes even more shorts (god rest their souls) have to cover. Its a vicious cycle at this point.

                    Its a perfect storm. This is a low float stock (21% insiders, 57% institutions, and 20+% WAS short) insiders and institutions are not usual big sellers, so any retail or small funds buying could easily cause it to go up, make a short cover, etc....there is a long tradition of selling the tesla calls as the share price has gone no where prior to this recent move for years and the IV was always so high.

                    You know the person/persons/market maker who sold you those calls is literally out all that money you made? So how do they protect themselves? They either buy the stock outright or buy the calls back. Market makers may buy the stock to hedge, exacerbating the move, if someone gets margin called by their broker which is likely given the size of the moves, theyre just out the money. Unsure how much in house hedging if any is done by brokerages. So I can see it basically being a bunch of buyers making everyone have to buy.
                    All taxable. If it was in Roth would have been much better. Would be amazing to have 7fig Roth.

                    The part about options contracts activity contributing that doesn't make sense is that major expirations are Fridays and we saw huge moves on Monday and at 4:30am on Tuesday (I didn't even know pre-market started so early until I say huge move by 5:30 today). If they are bracing for this Friday, it is going to be one Friday after another, especially if people exercise calls and don't sell the shares. If this is truly the cause, this could keep happening, especially if noone is selling. Can we see this double again just based on these dynamics? I bet there were a ton of poorly covered call options sold because if people were so certain TSLA was going bankrupt, they thought picking up a couple hundred dollars on a 3-4X market price call was money in the bank.

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                    • Originally posted by BCBiker View Post

                      All taxable. If it was in Roth would have been much better. Would be amazing to have 7fig Roth.

                      The part about options contracts activity contributing that doesn't make sense is that major expirations are Fridays and we saw huge moves on Monday and at 4:30am on Tuesday (I didn't even know pre-market started so early until I say huge move by 5:30 today). If they are bracing for this Friday, it is going to be one Friday after another, especially if people exercise calls and don't sell the shares. If this is truly the cause, this could keep happening, especially if noone is selling. Can we see this double again just based on these dynamics? I bet there were a ton of poorly covered call options sold because if people were so certain TSLA was going bankrupt, they thought picking up a couple hundred dollars on a 3-4X market price call was money in the bank.
                      Once the calls get nearer to being in the money or some risk threshold, holders will have to hedge out that risk, roll them up and out, or close. All adds pressure.

                      Where it goes just depends on who's left holding, what amount is short and their pain points, and someone willing to put the pressure on.

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                      • The problem with making a large gain as a % net worth in this type of speculation is that it creates a flood of neurotransmitters that very frequently cause people to make large errors.

                        It is not that the market punishes them or knows or cares, it’s not a conscious entity. And yet, so few keep their gains. Why ? The problem is that very few people have the experience, discipline and cognitive flexibility to stop (or reverse) after large, leveraged gains. The flood of neurotransmitters increases cognitive biases. You can know about cognitive errors but in real time you will still be rationalising like crazy and making those errors. Knowing about them doesn’t stop them. It is very difficult to remain rational.

                        What is the definition of bad gambling ? It is when you keep playing when the odds are no longer in your favour. That is the wheel of doom.

                        When the dust settles, read Dostoyevski’s ‘the gambler’. It encapsulates all the emotions that go with winning in speculation/gambling.

                        Consider this game : payoffs : 900% or -90%. Probability 50% of each at each play.
                        Playing this is ruinous.
                        The only way you can win is to stop when you are up 900%, or 8,100% if you are lucky enough to have had consecutive good turns.

                        I think the compounding rate that you can manage consistently over decades is what is important.

                        https://qph.fs.quoracdn.net/main-qim...f519470bd4af-c

                        I would avoid games which have unfavourable odds. I would stop playing if I somehow got involved and was ahead. I would stop playing if I was behind too if the odds are unfavourable.

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                        • What do you guys think about this person’s speculation about the flash crash? Market manipulation?

                          https://teslamotorsclub.com/tmc/thre...7#post-4451429

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                          • Originally posted by Nysoz View Post
                            What do you guys think about this person’s speculation about the flash crash? Market manipulation?

                            https://teslamotorsclub.com/tmc/thre...7#post-4451429
                            Have a hard time following that thread. Did hear another good explanation for partial driver behind the increase in addition to everything else, again, no idea if true or to what degree, but the explosion of ESG funds and them buying tesla could be part of it, and it makes as much since as anything outside of market makers being short gamma.

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                            • well I sold some of my long term holdings while the stock rallied a bit this morning... but also applied for options with my brokerage. that way in the future I can sell covered calls instead of selling straight stock if I understand that correctly.

                              also I have strong belief in the company so we'll see how these next few volatile weeks/month go. if it dips a good amount before q1 earnings and battery day, I'll buy calls/leaps at that point.

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                              • Originally posted by White.Beard.Doc View Post
                                Again, I don't normally buy individual stocks, but I bought Tesla a decade ago when I put down a deposit and then waited years for my first Model S. It reminds me of the late 80s when I felt the same way about Apple, when I bought my Mac SE with 1 MB of RAM and a 20 MB hard drive for $2900, and then there was that period of down years where Apple almost went broke.

                                Is it time to cash out my Tesla stock and go back to my boring index funds? I am old enough to know that no one knows how this will end.
                                I was ruminating over this with my wife last night. We typically invest in what our own household uses and has served us well. BankAmerica, Visa, Amazon, Apple, Disney. The one glaring exception has been Tesla. Though I have had solar and EV cars since 2003 including the Powerwall and 3 (too fiscally constrained for the S and X!), I didn't think rest of america was ready. Nope!

                                Very happy Tesla doing well. Sad that I didn't jump in with them in full confidence this time around. But very happy to continue support with our future Y and cybertruck

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