2017 Investor Roundtable: TSLA Market Action

[Mike Smith]

TSLA rises every single Monday morning. This is probably amateur retail investors learning about Tesla from a friend over the weekend, watched a bunch of Elon Musk youtube videos, and deciding to buy first thing Monday morning. These new investors (as opposed to amateur retail traders) will probably not be selling for a very long time. Every Monday morning we see this. I'd be worried if I was short.

 

[vgrinshpun]

There is no signs of short covering at Fidelity so far. This got to hurt!

 

[WarpedOne]

$8 and no comments ?

Mouth and hands full of popcorn ...

 

[neroden]

Well, that was interesting.

I suspected a quick jump was coming because there was an extremely positive news story late Sunday night showing up on Yahoo Finance -- basically saying "Model 3 is definitely on time". Bought another 100 shares premarket at $270. Sure enough! Then spent the morning rolling my cash-secured puts up since I have a new, slightly higher "price floor" which I think Tesla is very unlikely to drop below for more than a week or two.

 

[TrendTrader007]

Tsla shorts I want my money back

 

[neroden]

I have one other Tesla investing anecdote that I wanted to share. I have a friend who was lucky enough to be able to invest a small amount in one of the Tesla venture rounds at about $5 per share. He sold at about $35 per share, making a seemingly huge 7X gain. His reason for selling had mostly to do with "locking in" his gains rather than fundamental concerns in the company's direction. In fact, he bought back in last year at $2xx.. We were having dinner a couple weeks ago and his wife was ribbing him about all the $ they would have made if they had held on. "Locking in gains" is emotionally satisfying -- everyone likes winning -- but can lead to bad investment decisions. So I will try to resist selling until I believe something has fundamentally changed with the investment prospects, when a better opportunity comes along or for diversification purposes.

I only "lock in" gains when I expect that I'm going to have to spend the money in the near future (taxes, medical care, home improvements, living expenses, vacations, you know). At that point it makes sense to lock it in, in order to avoid the risk of a forced sale at a bad price. Before then? No.

Of course, if my paper gains get large enough, I may decide I want to buy a second house or something, which would be a reason to lock in some gains.

 

[TrendTrader007]

Tsla some super smart dudes on TMC were using me as a contrarian indicator to sell
Really!
Blocked!

 

[Mike Smith]

For those hoping for a sharp short sqeeze - I don't think it's going to happen. Yes, some shorts will get squeezed, but the vast majority of investors think Tesla is fundamentally overvalued, and there is no news that can come in the near term that will change this. As TSLA rises new shorts will come in to temper the rise. This is what has been happening and I expect it to continue.

 

[hoang51]

Well, that was interesting.

I suspected a quick jump was coming because there was an extremely positive news story late Sunday night showing up on Yahoo Finance -- basically saying "Model 3 is definitely on time". Bought another 100 shares premarket at $270. Sure enough! Then spent the morning rolling my cash-secured puts up since I have a new, slightly higher "price floor" which I think Tesla is very unlikely to drop below for more than a week or two.

I think it has to do with Elon over on the Eastern hemisphere earlier today that gotten more attraction to Tesla: Tesla CEO Elon Musk says ‘almost all new cars will be self-driving within 10 years’

 

[austinEV]

For those hoping for a sharp short sqeeze - I don't think it's going to happen. Yes, some shorts will get squeezed, but the vast majority of investors think Tesla is fundamentally overvalued, and there is no news that can come in the near term that will change this. As TSLA rises new shorts will come in to temper the rise. This is what has been happening and I expect it to continue.

Yeah it just works out to be price support. Whenever a ticker hits new highs, one should ask "who is buying at these levels?" If you cannot come up with a good answer for that, we could be toppy. But the lovely thing about TSLA is the answer is "people who hate the stock". (Plus new entrants, momo traders etc). Its just a nice bonus.

Plus major market tailwinds. Holy cow!

 

[vgrinshpun]

We've got some covering going on at Fidelity, 346k shares so far...

 

[Yggdrasill]

I sold some shares at 279.5. Now TSLA is down to 107.8% of my portfolio.

Next time I'm selling is probably after the short squeeze. (I don't have to see a sharp short squeeze. I'd be happy with a slow grind down to 20 million shares shorted.)

 

[ev-enthusiast]

Where is the 52 week high sitting?

 

[Drax7]

Glad we are building a nice cushion so that we can withstand any correction post earnings report.
if we sell off after earnings report on good news, it makes sense to add to the position.

 

[neroden]

I'd like to make a very newbie question, but I'm a small "but and hold" investor, and I will try to buy again in the next few years, depending on news and dips.
I don't plan to sell before 2020, or even 2025.

But I'm curious: do you think Tesla will ever give dividends?

There has been a secular worldwide trend for stocks to not pay dividends, ongoing since at least the 1970s. This can be good, when the company has good internal investments to make. Or it can be bad, when the company doesn't have any good internal investments, and habitually throws profits down ratholes.

This is just part of the current market environment. This may or may not change; it is quite independent of Tesla.

If it does change, it will change because the stock market is so riddled with frauds, accounting falsification, and with executives setting fire to company profits on ill-advised "reinvestment", that investors start *demanding* dividends -- giving companies with dividends significantly higher P/E ratios than companies without dividends in the same sector, for example. Or if you watch IPOs crash and burn if the company isn't offering dividends. If that happens, you'll see a return to everyone-issues-dividends, and in that case I'm sure Tesla will issue dividends too.

I actually think there's a decent likelihood of this happening within the next 20 years, but it certainly isn't happening this year.

 

[vgrinshpun]

Upper Bolinger Band (20 day) on a daily chart is at 274.14, and TSLA is more than $5 above this point. Looks like TSLA breaking-out as IBD predicted with the buy point at $269.44.

 

[T3slaTulips]

Just passed ATH close.

 

[PKINOC]

Was not expecting such a big move today.

Very entertaining!!!

 

[Yggdrasill]

I have to say, TSLA is stronger than I expected. I didn't think they'd break 280, but yes, that happened.

 

[MartinAustin]

holy s##t only $11 away from all-time high

...and... TSLA was $11 lower than the current price... yesterday's close.