Tesla, the investment

[Nysoz]

When TSLA was in the 300s is was so heavily manipulated by short sellers and other market makers. Tesla was executing as a company but mainstream news and 'analysts' kept beating it down. It's also a conspiracy theory but big oil also probably had a small hand in keeping a transformative EV company down. Those 4-5 years or so, the share price should have kept increasing as the company grew but kept trading in a small window. Everyone kept trying to value it only as a car company but you really have to see it as a battery/tech company that sells cars.

This run up has been a perfect storm type of picture. Previously large short interest, a company that's potentially disrupting multiple industries, multiple possible positive catalysts in a few months window, and basically a favorite (meme) stock among retail investors have all contributed. Shorts covering, increasing share price, others thinking it has increased too much so they start shorting again, and etc.

It's definitely valued richly, especially P/E, P/S ratios, even PEG ratio as traditionally valued. The problem is that these aren't traditional times. With the fed injecting trillions into the market, that money has to go somewhere. Maybe inflated P/E ratios or other metrics for the 'tech' companies will be the new norm until covid fears disappear and people travel/spend like they used to before.

There's always a possibility of China stealing Tesla tech. The Chinese EV company Xpeng is practically a clone of Tesla down to their website. The thing that will keep Tesla ahead is constant innovation by the best talent in the industry. So by the time China copies and implement something, Tesla will have another 3 year advantage. Sooner or later things will even out but Tesla will have first mover advantage and brand recognition. It also helps apparently the Chinese like American brands and prefer Tesla over China EVs for prestige.

[xraygoggles]

One good thing from the run up in the price is Tesla will be able to raise capital for the next few years much easier than before, via selling shares. Should be good for continual growth.

Also, how appropriate that the post-split price will be right around 420 or so (funding secured v2.0)!

[BCBiker]

3.5M

[Molar Mechanic]

No 3.5 million, but beats anything I've done in Vegas.

[BCBiker]

No 3.5 million, but beats anything I've done in Vegas.

Nice time to buy last May. I’m just counting options gains not shares that we bought in Roths bought in low $200s in 2014. Those were fairly minor positions when bought but now will pay for couple years in retirement.

[Nysoz]

My 3 year portfolio chart. You can see how I started off with mainly index funds, where I started investing more in TSLA mid 2019 after I got my car, and where I was able to start doing options trading.

[Tim]

My wife made over 800% on Apple. She wanted an IPhone. She has a 4S. Wanted to invest. I bought her 105 shares. Was that skill or luck?
She rolled over an account and wanted more. I bought her another 100 shares. She made 111% in less than a year. Was that skill or luck?
I hear about it virtually every day.
Concentrated investing works until it doesn’t.
She isn’t concentrated in Apple.
Hindsight is great. I wish she was. The only problem I don’t know next month or the next 20 years. Hatton curious, care to share your % gain on your oldest Apple tax lot?
Might be an interesting thread. Oldest gain in a portfolio.

[Molar Mechanic]

In my case, I'll actually claim that it was more than luck that put me in the stock. I was following the company from a fanboy and customer point of view. I knew the rumors, I knew the product, and there was clearly massive manipulation of the company's narrative being peddled.

At the time, the stock had traded flatly between 250-350 steadily for 5 years, despite proving themselves as a company and growing revenue from $3B to $24B over that period. Cash flow was positive (or nearly so) in their last filing, production problems had smoothed, and their only real headwind was a large bond that still wasn't due for 5 months. Despite that, between January and May the stock price fell by 35 or 40 percent. The only thing that made sense was a huge manipulation of the price.

I kept watching it and standing by my index only philosophy, until it went below $200 and I took some Vegas fun money and threw it at the stock. Not so much that it would be emotional losing it, but enough to make it fun. By October, the price was back to $300 and I was feeling pretty smart as the future looked bright. Now the rise from $400 to $2000? I have no darn clue why that has happened, and am lucky to be along for the ride.

[Lordosis]

In my case, I'll actually claim that it was more than luck that put me in the stock. I was following the company from a fanboy and customer point of view. I knew the rumors, I knew the product, and there was clearly massive manipulation of the company's narrative being peddled.

At the time, the stock had traded flatly between 250-350 steadily for 5 years, despite proving themselves as a company and growing revenue from $3B to $24B over that period. Cash flow was positive (or nearly so) in their last filing, production problems had smoothed, and their only real headwind was a large bond that still wasn't due for 5 months. Despite that, between January and May the stock price fell by 35 or 40 percent. The only thing that made sense was a huge manipulation of the price.

I kept watching it and standing by my index only philosophy, until it went below $200 and I took some Vegas fun money and threw it at the stock. Not so much that it would be emotional losing it, but enough to make it fun. By October, the price was back to $300 and I was feeling pretty smart as the future looked bright. Now the rise from $400 to $2000? I have no darn clue why that has happened, and am lucky to be along for the ride.

Are you still holding or did you sell some or all?

[Molar Mechanic]

Are you still holding or did you sell some or all?

I'm just along for the ride. While I do think it's likely overvalued, I have no plans to be a "trader". I'll hold on to the shares until I donate them or pass them to my heirs. Even at the current value, the shares represent an inconsequential percentage of my holdings, and I'm just watching from afar. I'd guess they'll probably drop at some point, but I don't think they've reached the peaks they'll reach over the next 50 years, which is my investing horizon.

[GIMD]

I made the largest % gain on TESLA but it's also one my greatest stock blunder. I purchase TESLA last summer in the $200s. I made the rookie mistake of setting a 20% trailing stop on such a volatile stock. On July 13th, the stock swung up 16% and down 5% in the same day automatically triggering the sale. So you can imagine my surprise when I checked my portfolio and I no longer held TESLA. Not only that, I held TESLA for just under 1 year . Lesson learned. No need for trailing stop for someone like me who look at their stock portfolio everyday.

[BCBiker]

I made the largest % gain on TESLA but it's also one my greatest stock blunder. I purchase TESLA last summer in the $200s. I made the rookie mistake of setting a 20% trailing stop on such a volatile stock. On July 13th, the stock swung up 16% and down 5% in the same day automatically triggering the sale. So you can imagine my surprise when I checked my portfolio and I no longer held TESLA. Not only that, I held TESLA for just under 1 year . Lesson learned. No need for trailing stop for someone like me who look at their stock portfolio everyday.

Stop loss is fundamentally the dumbest thing for anyone with a time horizon greater than 20 mins. Why would you program in to sell at a loss?

[BCBiker]

In my case, I'll actually claim that it was more than luck that put me in the stock. I was following the company from a fanboy and customer point of view. I knew the rumors, I knew the product, and there was clearly massive manipulation of the company's narrative being peddled.

At the time, the stock had traded flatly between 250-350 steadily for 5 years, despite proving themselves as a company and growing revenue from $3B to $24B over that period. Cash flow was positive (or nearly so) in their last filing, production problems had smoothed, and their only real headwind was a large bond that still wasn't due for 5 months. Despite that, between January and May the stock price fell by 35 or 40 percent. The only thing that made sense was a huge manipulation of the price.

I kept watching it and standing by my index only philosophy, until it went below $200 and I took some Vegas fun money and threw it at the stock. Not so much that it would be emotional losing it, but enough to make it fun. By October, the price was back to $300 and I was feeling pretty smart as the future looked bright. Now the rise from $400 to $2000? I have no darn clue why that has happened, and am lucky to be along for the ride.

I agree. There was so much mis-information. People with actual reputations were saying things that were clearly not true. There were people on here calling for the imminent insolvency of the business. I don't think I can express how obviously wrong that perspective was at the time given the zeal that Tesla was pursuing growing the business.

The Q2 2019 numbers were actually fully consistent with the bull case (despite being a loss) but the the bear sentiment was saturating everywhere.

It was perhaps the greatest market inefficiency of our life times. There are few opportunities for >100,000% returns. There were options that had previously been trading for >$10 that were selling for $0.15 and had potential to be worth $100s. I knew when I was buying these assets that there was virtually no way I could lose money, since they were priced as worthless functionally. When Q3 numbers came out, I was trembling. I knew it was going to be a big return. I am a little surprised at how it has turned out by magnitude but not really by direction. As I said when it got to $1000 per share, I said there is room for this to run. I will reconsider position if it slips over $3000 in the next 2 months, depending on the material information that comes out at shareholder meeting. If it does get to $3000 I will be at >$5M return. Would like to wait to lock in long term capital gains on all positions though so might sell some spread calls and ride that out. Anyway, I'm glad I'm not only one on here that benefitted from this. The dogma of indexing is mostly true but I don't think that it should force those who see an opportunity to not seize it with some nominal portion of the portfolio. I invested about 2% of my 2nd year attending portfolio in options for example.

[Nysoz]

When the share price dipped below $200 1 year ago, I went in as much into shares as I could at that time. As it ran up through Jan/Feb, I told myself that I wouldn't miss that opportunity again so I got approved for options in Feb. The opportunity did present itself to me this recent Q2 deliveries estimates, as all the analysts were way off, and I took that opportunity to get as many long dated calls (next time dating them 1+ years out for taxes) as I could with what I had available which was around 5-10% of my portfolio.

I think FSD/autonomous driving will have a similar parabolic event. But the problem is how long that'll take to achieve, how regulators will allow it, who else will be close at that time, and how much Tesla can profit off it in which ways. Hopefully the IV on leaps will go down sooner or later so I can pick some up at a decent price.

[Tim]

Stop loss is fundamentally the dumbest thing for anyone with a time horizon greater than 20 mins. Why would you program in to sell at a loss?

For a prop trader, the key is to size your trades and have a risk tolerance for each. If your trade does not pan out then cut the losses. Let the winners run. Traders are not limited to day trading. Many time horizons. The reality is that losses typically expand rather than reverse and go positive. Time is not on your side in a losing trade.