Hi, I’m a short seller

[elasalle]

We still don't know if he is just an innocent short, or a troll ready to get to work.

This thread is one thread where the Long Trolls and Fudsters will be put on notice or maybe also added to ignore list.

Kinda sucks that so far we only see Longs replying (looks like they are well intended and with good hearts). Where are the Shorts - they should feel welcome here.

 

[ValueAnalyst]

Hello All: As my name suggests, I have made a bet against Tesla via long dated put options. I look forward to a healthy discussion from all sides.

Welcome, and thanks for being open. I'm long and write on Tesla on various platforms. What would you like to discuss?

 

[ShortSeller]

Welcome, and thanks for being open. I'm long and write on Tesla on various platforms. What would you like to discuss?

V.A - Thanks for stopping by. I read your SA articles. Let’s talk about the financial outlook, I see a big problem looming for Q1 earnings, possibly a loss of over $1 Billion

 

[ShortSeller]

I was going to ask whether you are worried about the size of the short bet against the company - that you were joining a crowded trade. But I think that question is functionally irrelevant for you as your position is via option ownership, so your worst case are the options expiring worthless for a 100% loss.

I've considered the opposite side of that trade, purchasing call options (with a limited downside of 100% loss if the options expired out of the money), but all I've actually done is purchased shares with cash and hold them.

If you have any thoughts about the aggregate size of the short against Tesla, and whether that's good for an incremental investor in a short position, I'm interested in hearing them.

Good question, I think outright shorting on this is dangerous, it’s a crowded trade with extremely high institutional ownership. The potential for a squeeze is high even if the fundamentals are poor.

 

[ValueAnalyst]

V.A - Thanks for stopping by. I read your SA articles. Let’s talk about the financial outlook, I see a big problem looming for Q1 earnings, possibly a loss of over $1 Billion

I have 1Q18 loss estimated at $800 million, which is close to market expectation, so likely is already priced in the stock.

I see slight improvement in 2Q18, primarily due to higher Model 3 deliveries, followed by positive net income in 3Q18 and thereafter.

 

[Gwgan]

have made a bet against Tesla via long dated put options.

I see a big problem looming for Q1 earnings,

Are you short because you think the company is going to do badly and are you looking at Q1 one as the beginning of the end or are you focusing on Q1 as a short term opportunity?

 

[bro1999]

We still don't know if he is just an innocent short, or a troll ready to get to work.

What's an "innocent" short? Someone who is short a stock purely for personal profit?

 

[ShortSeller]

Are you short because you think the company is going to do badly and are you looking at Q1 one as the beginning of the end or are you focusing on Q1 as a short term opportunity?

I actually think the beginning of the end has already happened, specifically Q3 when the stock price was above $350 and the investors were led to believe M3 production was ramping up. I’m not in for a short term gain, I’ll be holding well past Q1 earnings no matter what happens.

 

[Yggdrasill]

What's an "innocent" short? Someone who is short a stock purely for personal profit?

I guess it's a short that isn't out there, slashing the tires of the car carriers and peeing on the superchargers. Figuratively speaking.

 

[Electroman]

I see a big problem looming for Q1 earnings, possibly a loss of over $1 Billion

Ya.. so..?

But to your point, how does a company in a highly capital intensive industry - how many other industries can you name that are this capital intensive? - would start making profit in a short 5 years since they started manufacturing their first (mass market) model. Sure they could if they didn't bother with Gigafactory or any other investments laying the foundation for the future, but then whats the point? A mini Porsche sized company will be swamped and bought over in no time.

 

[ShortSeller]

What's an "innocent" short? Someone who is short a stock purely for personal profit?

Not sure what this means, don’t longs look for personal profit?

 

[bro1999]

Not sure what this means, don’t longs look for personal profit?

That's why I'm asking. Is it possible to be an innocent short?

 

[ShortSeller]

Ya.. so..?

But to your point, how does a company in a highly capital intensive industry - how many other industries can you name that are this capital intensive? - would start making profit in a short 5 years since they started manufacturing their first (mass market) model. Sure they could if they didn't bother with Gigafactory or any other investments laying the foundation for the future, but then whats the point? A mini Porsche sized company will be swamped and bought over in no time.

Actually Elon said the profits from S and X would pay for the 3, then made several claims that additional capital wouldn’t be necessary. As we now know, all of these claims never came true.
My expectation was the losses would at least begin to narrow 5 years into the start of mass production, but the opposite is happening.

 

[ShortSeller]

That's why I'm asking. Is it possible to be an innocent short?

I guess I don’t quite understand why a short needs some sort of qualifier, as in innocent vs. guilty. Aren’t we all here to see our investments profit, regardless of what side of a trade we are on?

 

[MrRandyB]

Have you driven a Tesla?

 

[Uncle Paul]

Longs invest in to future of a company.
Shorts invest in the failure of a company.

Stock market was developed to provide capital to hard working entraprenures with great ideas and a future.
Shorts have perverted the stock market into a gambling casino, hoping the worst things possible will take down a great company.

 

[Yggdrasill]

Longs invest in to future of a company.
Shorts invest in the failure of a company.

Stock market was developed to provide capital to hard working entraprenures with great ideas and a future.
Shorts have perverted the stock market into a gambling casino, hoping the worst things possible will take down a great company.

Hopeing isn't so bad. In my view, what they're doing only becomes immoral if they actively sabotage the company, which admittedly, many shorts do.

 

[ShortSeller]

Have you driven a Tesla?

Rode as a passenger in a Model S, never drove it myself.

 

[ShortSeller]

Longs invest in to future of a company.
Shorts invest in the failure of a company.

Stock market was developed to provide capital to hard working entraprenures with great ideas and a future.
Shorts have perverted the stock market into a gambling casino, hoping the worst things possible will take down a great company.

Doesn’t it take two sides of a trade to make a market?

 

[ShortSeller]

Hopeing isn't so bad. In my view, what they're doing only becomes immoral if they actively sabotage the company, which admittedly, many shorts do.

Let me know if you have any examples of this. My last big short was SunEdison, which went bankrupt because it was horribly mismanaged.