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for example, i think if you had been holding way OTM puts in March 2020 they would have shot up in value tremendously. that’s what you’re shooting for if you implement this strategy—there’s so much carnage going on and your normal portfolio is getting cut in half, but this tiny put position is...

Sorry for the confusion! I should clarify in the book that Spitznagel was referencing puts on the S&P index, not specifically puts on TSLA stock. So those numbers are calibrated for the S&P market hedging.

Mark Spitznagel in "The Dao of Capital" recommends a strategy of monthly purchasing put options 2 months out that are 0.5 delta (if 40% IV, 30% OTM ). Target is spending 0.5% on puts every month. The strategy loses small amounts of money regularly, but in times of stress it really prints. As...

My biggest concern with GBTC is that they charge 2% management fee to run what basically amounts to an ETF that only buys a single thing. It’s not like ARK where they have to, you know, research stuff. I’m happy buying and holding BTC directly.

re: Starlink, I’m imagining not just space-based internet for Earth but also blanketing all of Mars....and serving as the link between the two worlds. so that one day Martians can send us pictures of their cats via Starlink, and Earthlings can respond with memes.

Dad is that you Thanks for this excellent post. I had been curious about Boring Company, and had been internally speculating about how it is strategically adjacent to Tesla (and technically all EVs...but really just Tesla, ha!) given how the tunnels are designed to be safe for EV use...and...

Thanks for this. Out of curiosity, what’s your thesis on how Boring Company evolves in the future and how it impacts Tesla?

Lol I have FSD on a 2016 Model S, so I’ve been waiting for a looong time to get my HW3 install date. In fact, it finally got done by the Service Center two weeks ago. Despite Neroden’s (in)famous protestations I’m happy to report the Service Center service was excellent and efficient, with...

yup. Pack it up boys, PLAID MODE coming in hot!

Yeah this is the kind of stuff I’m thinking about, you nailed it right on the head. I mean for many years people have been saying Tesla can’t make a profit or they are terrible at manufacturing. But I think those were growing pains and they’re rapidly evolving. My hypothesis is that their capex...

I had a hard time picking Sep or Oct 2020 or Jan or Mar 2021 strikes for calls. So I decided to punt and buy Sept 2022 $1500 calls. lol. breakeven is $2065. there’s so much good news on the horizon for the second half of 2020. then there are some really big product/factory ramps in 2021. plus...

Yup! My username gra-phil-war is a mash up of three people: 1. Benjamin Graham 2. Philip Fisher 3. Warren Buffett Let’s talk about mistakes. In my youth, I refused to buy Apple when it was sub-200B market cap because I was a so-called value investor looking for defensible moats like Warren...

Are you planning on selling weeklies on that? Or going out 30, 45, 60 DTE? I’ve been avoiding doing covered call sales, got burned a few times.

Thanks for this, very helpful perspective.The next thing I really want to do is understand more of the ICE automaker financials. I think the challenge is that Tesla’s vertical integration approach vs normal industry approach (outsource everything, focus on engine, power train, assembly) should...

Thanks for the help! So let’s say the “super crazy” over estimate for the cost to build Giga Shanghai to the current level of production is 1.5B. Mathematically, its gotta be less than that because as you mentioned, it appears the loans are funding working capital needs as well as construction...

I’ve been reading the 10Qs to try to get a sense for how much the China Gigafactory cost to build so far. Is it the “China Loan agreement”, which has 741M unpaid balance on page 24 of the Q2 2020 10Q? Or is it somewhere else.

The nice thing is that you’ve been conservative on the bottom line vs. actual. So when I look at your estimate, I have some measure of confidence that the estimate is in the ball park but not wildly too high.

I’m guessing you sold MSFT in 1998 because you thought it was overvalued? It was dead money for so long. Getting back 2013 was really good timing. i’m curious about the thought process about your decision to finally get back into it after it had been dead money for so long. What did you see that...

That was definitely Huntington Beach, near main street and the boardwalk. I live nearby. Can confirm they are retarded there. Good weather though!

Rumor mill... Tesla working on second factory in China (Chongqin) https://twitter.com/bennywu45/status/1282893550288465921?s=21

I’ve had some “poop in the pants” moments from doing things like this. The adrenaline rush is like no other. Really makes you feel alive.

Just wanted to say thank you paydirt76 for opening my eyes to this. i’ve sold calls on tsla in the past and i instinctively lean towards the option-selling strategy, but this entire series of posts has opened my eyes to how dangerous call selling truly is in tesla’s case. i estimate that i’ve...

I bought a pair, figured it should be my good luck charm.

This is exactly what a cat would say.

caught the Neroden virus

Sounds like she’s hoping the “electric revolution” won’t happen so soon while she’s still in charge because she has no idea how GM will succeed in that environment. Implied in her statement is her true game plan: to retire with a golden parachute first, and then let her successor deal with the...

Texas Gigafactory secured!!!!

as long as it’s an odd number of times...

That’s actually super high praise, coming from Charlie.

I was thinking about this very informative post and out of curiosity ran some back of the envelope calculations to get a sense of the scale of ambition implied by Elon’s comments in interviews. 1. 1.5M vehicles in 2021 and then 3M in 2023 is approx 41% compounded growth in production in Elon’s...

I have wondered about Bill Gates’ opinions of Tesla. As I recall it, I saw a car interview Bill Gates did with the author of Seveneves (great book!). In it, you can see that Bill Gates does drive a metallic blue Model X. So he should be familiar with the cars and the company. Bill Gates Drives...

I’ve been thinking about the implications of Tesla’s drive to create a million mile battery and the use of super durable stainless steel in the cybrtrck. I initially thought it could hurt sales because wouldn’t you want to have some sort of planned obsolescence in the products? People driving...

Exactly this! The $100 reservation could be viewed as a way for Tesla to put out a qualifier of interest for potential buyers. Instead of paying for google ads or Facebook ads or whatever to acquire names and email addresses of potentially interested people, Tesla now gets “paid” in the sense...

I, too, had a dream about the Cybertruck. It came with a Kuka robot-like arm that was strong enough to lift drywall and pick up 2x4 lumber with ease while also being nimble/precise enough to pick up toddlers and strap them into their car seats. Say no more, Elon. Take my money!

Interesting perspective on the auto industry, especially where he talks about the Time to Equity indicator he developed to predict auto industry new car sales, his opinions on Ford/GM/FCA-Chrysler...

72 GWh is 72 million kWh (in a month). Let's say Tesla can get a $0.05 margin per kWh from Supercharger fees above costs and assuming 50% of energy delivered is billed (b/c of all those free supercharging cars that are still around) and then run it for a year...then that works out to 21.6M in...