I'm not related to JP, but I'm shorting TSLA...

[Causalien]

You can always see the last edit time of my posts in the forum (I sometimes edit a few minutes or at max a few hours later for clarity because I'm not a native speaker). Comments on SA can't be edited a few minutes after posting anyway.

I can't give price targets (these depend on future - yet unknown - news in my opinion so I constantly revise them) or timeframes and I'm certainly not an oracle. (I only do this because some people accused me of being short when I had no positions or assumed I was "short since $30" etc.).

I'm also not a technical or short-term trader, I usually hold for a few weeks or even months.

Irregardless, when an argument arises. A timestamped posts with no edits holds more weight than ones that has. Explaining how an edited timestamp that occurred shortly after just weakens your position. Some of the masses cannot understand why that is so, even though tmc have a special breed of people. but we are about to be flooded with an army of newbies like the last time we approached $200.

 

[keithz]

Make sure you don't modify your timestamp posts. Posts with "modified" cannot be timestamps.
You will also need to include your position % based on your net worth. Since a $1000/or a 1% investment with perfect execution shows no conviction at all.

I did the same and if you do this, you hold weight in my world. Even more weight is if you include a price target and a time frame of when it will happen. These are the steps in becoming an oracle if you are not explaining why you are shorting.

Honestly, I really don't get the obsession with the size of somebody's portfolio and the assumed correlation to their conviction. To a person who earns $30k per year, a $10k portfolio is an achievement. I think the percentage of your portfolio dedicated to a particular stock or trading philosophy or position says a lot more about your conviction. My own portfolio is at $50k. 85.41% is Tesla stock and long calls. Undiversified? Sure. That's cause TSLA shot up so quickly and I got incredibly lucky. My very first TSLA trade was in Fall 2012 at about $28. The average price of my position is around $85. So basically, Tesla was a huge chunk of my portfolio at the start. And it's grown to absolutely dominate my portfolio, largely because of my conviction and belief that TSLA will go up.

Now is my conviction worth less because my portfolio is only $50k?

I was hestitant to be sure. I was getting back into the market after I had cashed out my portfolio to put a downpayment on a house. So I had spent all of Summer 2012 hesitating on getting back into the market. I had actually been lusting over the Model S too. But decided that it was too rich for my blood and I would need to wait for the E. In the meantime, whatever I read about the car convinced me that I needed to put some dough into Tesla directly. I opened the trading account in September. On top of savings on hand, I actually even borrowed from my own line of credit. And plunked about $10k into TSLA to start. Over time, my total investment in TSLA has been about $17k, but that position is worth over $40k. I'm happy.

 

[kcveins]

Honestly, I really don't get the obsession with the size of somebody's portfolio and the assumed correlation to their conviction. To a person who earns $30k per year, a $10k portfolio is an achievement. I think the percentage of your portfolio dedicated to a particular stock or trading philosophy or position says a lot more about your conviction. My own portfolio is at $50k. 85.41% is Tesla stock and long calls. Undiversified? Sure. That's cause TSLA shot up so quickly and I got incredibly lucky. My very first TSLA trade was in Fall 2012 at about $28. The average price of my position is around $85. So basically, Tesla was a huge chunk of my portfolio at the start. And it's grown to absolutely dominate my portfolio, largely because of my conviction and belief that TSLA will go up.

Now is my conviction worth less because my portfolio is only $50k?

I was hestitant to be sure. I was getting back into the market after I had cashed out my portfolio to put a downpayment on a house. So I had spent all of Summer 2012 hesitating on getting back into the market. I had actually been lusting over the Model S too. But decided that it was too rich for my blood and I would need to wait for the E. In the meantime, whatever I read about the car convinced me that I needed to put some dough into Tesla directly. I opened the trading account in September. On top of savings on hand, I actually even borrowed from my own line of credit. And plunked about $10k into TSLA to start. Over time, my total investment in TSLA has been about $17k, but that position is worth over $40k. I'm happy.

I agree wholeheartedly..

 

[DaveT]

As a rule of thumb, a single short position is only 1% of my portfolio and my overall short position is around 5% (around 10% was the all-time-high).
My last trade at $198 was 0.5x (50% of a normal-sized short-trade as indicated, where x is about 1% of the portfolio size).

So if your TSLA short position at $198 was 0.5% of your portfolio, then what's the point of posting (and kind of bragging about it) on a Tesla Motors fan site? That's like 2.5 shares short if you're portfolio is $100k (or 10 shares short if your portfolio is $400k). It's not very noteworthy.

If you want to add to the short argument, then you should join a thread that's already discussing that...
Devils advocating...from someone who shorted TSLA

Actually, I think this thread should be merged with the thread I linked to and we should keep all the devils advocates/shorts posts together there.

 

[NigelM]

If you want to add to the short argument, then you should join a thread that's already discussing that...
Devils advocating...from someone who shorted TSLA

That other thread is in the past tense; Realist finally abandoned the dark side. ;-)

 

[tftf]

So if your TSLA short position at $198 was 0.5% of your portfolio, then what's the point of posting (and kind of bragging about it) on a Tesla Motors fan site? That's like 2.5 shares short if you're portfolio is $100k (or 10 shares short if your portfolio is $400k). It's not very noteworthy.

That's a valid point. Let me discuss why I spend a disproportionate amount of time (the long positions in my portfolio are larger, I only have 7-20 positions on usually, some of them are passive ETF investments, so they require less attention) on Tesla with respect to the current portfolio size:

Tesla in my view is a disruptive company (even if it fails or remains a niche player far in the future).

It has a large influence (or "halo" effect) on the entire personal transportation market. Let me give two other examples: Apple had and has the same halo effect on the PC and CE industry, Bitcoin has a halo effect on traditional fiat currencies. Since I can't analyze all companies or trends in a sector as an independent, I focus on these kind of organizations or developments more than established companies to look into the future and develop scenarios.

In the auto industry (*), I look at two companies at the moment: TSLA and Nissan-Renault (actually 2.5 companies, because Nissan and Renault are still two companies but working closely together. A good article on this: What is Carlos Ghosn waiting for? | FT Alphaville ).

I also keep an eye on Toyota should they make progress in hydrogen (I know that Tesla execs like to call this "fool cells") and Honda (mainly because of their R&D in robotics) as well as BMW.

I see two major long-term trends in the auto industry:

- Alternative propulsion (but I'm not sure yet if long-range EVs really will be the winners)
- Driverless cars and related services, shrinking long-term ownership ratio of cars (what some pundits like to call "Transport as a service")

Both companies are doing interesting things in these areas, that's why it's worth looking at them more closely. There will also be many potential new entrants in my opinion because these two trends require different skill sets. For example, I see Asian consumer electronics companies (such as Samsung) enter the EV space and make cars in 5-10 years from now. GOOG is another name but so far their entries into making hardware for consumers failed quite miserably.

PS: As an additional disclosure, I think going long again Renault or Nissan in the future, especially if they speed up a merger. I was long both companies in 2009 into early 2010.

__________
* I know some people say Tesla is a tech company, not an auto company. I discussed this earlier.

 

[austinEV]

Honestly, I really don't get the obsession with the size of somebody's portfolio and the assumed correlation to their conviction. To a person who earns $30k per year, a $10k portfolio is an achievement. I think the percentage of your portfolio dedicated to a particular stock or trading philosophy or position says a lot more about your conviction. My own portfolio is at $50k. 85.41% is Tesla stock and long calls. Undiversified? Sure. That's cause TSLA shot up so quickly and I got incredibly lucky. My very first TSLA trade was in Fall 2012 at about $28. The average price of my position is around $85. So basically, Tesla was a huge chunk of my portfolio at the start. And it's grown to absolutely dominate my portfolio, largely because of my conviction and belief that TSLA will go up.

Now is my conviction worth less because my portfolio is only $50k?

I was hestitant to be sure. I was getting back into the market after I had cashed out my portfolio to put a downpayment on a house. So I had spent all of Summer 2012 hesitating on getting back into the market. I had actually been lusting over the Model S too. But decided that it was too rich for my blood and I would need to wait for the E. In the meantime, whatever I read about the car convinced me that I needed to put some dough into Tesla directly. I opened the trading account in September. On top of savings on hand, I actually even borrowed from my own line of credit. And plunked about $10k into TSLA to start. Over time, my total investment in TSLA has been about $17k, but that position is worth over $40k. I'm happy.

There are 2 reasons position size matters. One, as Dave T points out that his short position might be so small as to be a dalliance in his portfolio. The second reason is that you could say you shorted at 198, and the stock goes to 210 he could say he shorted more, then it goes to 220, he says he shorts more. Then the stock goes down to 210. Then he could divulge the amounts: 2 shares at 198, 2 shares at 210 and 200 shares at 220. So you can dial in a victory even with "timestamps" without quantity.

 

[TSLAopt]

There are 2 reasons position size matters. One, as Dave T points out that his short position might be so small as to be a dalliance in his portfolio. The second reason is that you could say you shorted at 198, and the stock goes to 210 he could say he shorted more, then it goes to 220, he says he shorts more. Then the stock goes down to 210. Then he could divulge the amounts: 2 shares at 198, 2 shares at 210 and 200 shares at 220. So you can dial in a victory even with "timestamps" without quantity.

It should be very clear to everyone that tftf lost a lot of money already trying to short TSLA. Why else would he be on these boards and SA incessantly trying to talk the stock down if he wasn't short the stock??
If he wasn't short those times and was waiting for an entry point (ie. 198) he would have kept his mouth shut hoping it goes higher and only then begin touting his horn once he put on his short at 198.

 

[sleepyhead]

It should be very clear to everyone that tftf lost a lot of money already trying to short TSLA. Why else would he be on these boards and SA incessantly trying to talk the stock down if he wasn't short the stock??
If he wasn't short those times and was waiting for an entry point (ie. 198) he would have kept his mouth shut hoping it goes higher and only then begin touting his horn once he put on his short at 198.

Didn't you read his post from last November where he claimed, with perfect hindsight, that all the trades that he ever made in TSLA (both long and short) were perfectly timed and big winners, without ever making a losing trade?

I agree with you completely TSLAopt, I don't think he is posting in good faith.

 

[tftf]

Didn't you read his post from last November where he claimed, with perfect hindsight, that all the trades that he ever made in TSLA (both long and short) were perfectly timed and big winners, without ever making a losing trade?

I had a losing trade around $90, please see my post again. I also wrote later in this thread that I was lucky because of overblown (imho) fire incident reactions in mass and financial media and closing my short position at the right time back in November 2013. I was also lucky that Goldman Sachs issued a negative report on TSLA right after I entered my first short position around $125.

70-80% of my portfolio is usually in ETFs, I do not believe in picking stocks or being able to beat the market consistently for my core portfolio, luck is often involved in my opinion even if I try to analyze my few active picks in detail.

About sizes: I will specify that, usually I do simple trades opening/closing the entire or half of the position (so 0.5x at $220 would be the same amount of shares again as the 0.5x at $198. The default size when not specified is 1x).

Anyway, before the dicussion turns unproductive again:
I will just post my TSLA trades from now on (and hopefully discuss the battery plant and financing in a constructive way when that news is public. This plant will influence TSLA stock and long-term strategic outlook a lot in my opinion).

PS: I went long AAPL recently around $501 after staying on the sidelines at AAPL for months despite writing a lot about the company (see 'halo' explanation above). Is that also nefarious since that happened to be the short-term bottom back in January? Proof: tftf's StockTalks - Seeking Alpha

 

[NigelM]

I will just post my TSLA trades from now on....

Please don't turn this into your trading diary, that won't be useful to anyone. The interest level in your trades is undoubtedly because you'd have to be a genius or very lucky to have succeeded so much shorting a stock that's had such long-term upward momentum. You also have to acknowledge that you must have some motivation to come to Tesla's biggest fan club and announce that you're shorting the stock.

WRT luck: I understood Realist's position (although I disagreed with it) because he just doesn't like Model S. I understand that you argue on the financials but I'm actually more curious why you've shorted again when you say yourself you lost money once and got lucky a couple of times? If that GS report had timed differently or the fires hadn't happened you wouldn't be shorting again would you? If I shorted a stock that had a meteoric rise and I had a lucky escape, I doubt I'd go back there to play; I think I'd have more fun in a casino at the roulette wheel.

 

[tftf]

You also have to acknowledge that you must have some motivation to come to Tesla's biggest fan club and announce that you're shorting the stock.

WRT luck: I understood Realist's position (although I disagreed with it) because he just doesn't like Model S. I understand that you argue on the financials but I'm actually more curious why you've shorted again when you say yourself you lost money once and got lucky a couple of times?.

My motivation? Simply showing my positions after being accused of being short when I had no TSLA position or people accusing me of "being short since $20-30". I can't add a disclosure line to every comment I make on SA, it's simpler to add it here.

As for luck vs skill: I have been in the stock market since 1988 (although I could only buy a few stocks back then as a teenager), so I have some experience. However, I think many people retro-actively attribute their winning trades to skill and forget about luck. A good book has been written on the topic recently (no relation to the author):

Luck and Skill Untangled: The Science of Success - Wired Science

I do look at valuation numbers (PEG, EV/EBITDA...), running DCF on a few future scenarios, company news and management, trading volumes, analyst estimates, institutional holdings and short positions, general stock market sentiment and outlook for regions the company generates future revenue and finally simple technical analysis (I do not believe in hundreds of studies from Ichimoku clouds to Elliott waves) to create entry and exit points.

After all that, I still think luck plays a role.

 

[NigelM]

My motivation? Simply showing my positions after being accused of being short when I had no TSLA position or people accusing me of "being short since $20-30". I can't add a disclosure line to every comment I make on SA, it's simpler to add it here.

I'm not sure you're bolstering your reputation on SA by talking shorts here, but maybe you are. It also seems like a lot of work for what you say is a tiny fraction of your portfolio, but who am I to judge.

P.S. You're welcome to continue discussing here under the same conditions as everyone else; but, just to reiterate, this thread should not become your trading diary.

 

[NigelM]

Mod Note: some posts went here - Grammar-Misteaks-Spelling-Misteaks-and-Bad-Puns-)

 

[TD1]

Luck and Skill Untangled: The Science of Success - Wired Science

lol@quoting Wired.

Let me see if I can find some good Disney articles.

 

[Causalien]

Honestly, I really don't get the obsession with the size of somebody's portfolio and the assumed correlation to their conviction. To a person who earns $30k per year, a $10k portfolio is an achievement. I think the percentage of your portfolio dedicated to a particular stock or trading philosophy or position says a lot more about your conviction. My own portfolio is at $50k. 85.41% is Tesla stock and long calls. Undiversified? Sure. That's cause TSLA shot up so quickly and I got incredibly lucky. My very first TSLA trade was in Fall 2012 at about $28. The average price of my position is around $85. So basically, Tesla was a huge chunk of my portfolio at the start. And it's grown to absolutely dominate my portfolio, largely because of my conviction and belief that TSLA will go up.

Now is my conviction worth less because my portfolio is only $50k?

I was hestitant to be sure. I was getting back into the market after I had cashed out my portfolio to put a downpayment on a house. So I had spent all of Summer 2012 hesitating on getting back into the market. I had actually been lusting over the Model S too. But decided that it was too rich for my blood and I would need to wait for the E. In the meantime, whatever I read about the car convinced me that I needed to put some dough into Tesla directly. I opened the trading account in September. On top of savings on hand, I actually even borrowed from my own line of credit. And plunked about $10k into TSLA to start. Over time, my total investment in TSLA has been about $17k, but that position is worth over $40k. I'm happy.

Notice how I also asked about the percentage to net worth. I know what you are trying to say, which is why I asked both $$$ amount and %. Some people like to use $$$ amount some %. But revealing both is usually a nono since that reveals the net worth. What I wanted to know is his conviction, no matter how tftf expresses it. I have no ulterior motive but to properly categorize tftf into the correct indicator. Is tftf 10% as important as Realist? Or is Realist 10% as important as tftf? I need to know this. Otherwise tftf is just a tease to trade jokes with.

Now we konw tftf is 80% in ETF. It still doesn't say whether or not he is 20% networth short TSLA or 0.01% networth short Tesla. This will also allow me to calculate whether (and at what point) he gets margin called to correlate to his story.

 

[DaveT]

Now we know tftf is 80% in ETF. It still doesn't say whether or not he is 20% networth short TSLA or 0.01% networth short Tesla. This will also allow me to calculate whether (and at what point) he gets margin called to correlate to his story.

tftf shared earlier that his TSLA short position at $198 was with 0.5% of his portfolio. Since a portfolio is typically smaller than net worth, you might be correct with your 0.01% of net worth guess.

My last trade at $198 was 0.5x (50% of a normal-sized short-trade as indicated, where x is about 1% of the portfolio size).

 

[Causalien]

tftf shared earlier that his TSLA short position at $198 was with 0.5% of his portfolio. Since a portfolio is typically smaller than net worth, you might be correct with your 0.01% of net worth guess.

Missed that.

 

[tftf]

lol@quoting Wired.

Let me see if I can find some good Disney articles.

Have you read the link? It's an interview with the author of the book, not a Wired article. If you prefer another source:

In the junk-bond fueled M&A boom in the late ’80s, I owned some stocks that were taken over at generous premiums. My returns were impressive over a very short interval, and for a bit longer than that, I believed myself to be a skilled stock picker. But when results are due to luck, the passage of time brings mean reversion, and two decades later I’ve a pretty good notion of where I sit on the investment luck/skill continuum.

According to Michael J. Mauboussin who spoke at the 15th Annual Equity Research and Valuation Conference on December 6, in Philadelphia, investing is one of many activities that involve both luck and skill, and it is not always easy to untangle the two. How many hot hitting baseball players in April are still hitting in August? How many stock pickers who outperform this year will beat a dart board next year? The answer depends upon whether luck or skill had more to do with their results, and this is the subject of Mauboussin’s recent book, The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing.

How Many of Our Successes and Failures Should Be Attributed to Luck? | Enterprising Investor

As for position size: I also do mirrored portfolios for third parties, so the size of all portfolios is quite substantial. But in percentages of each portfolio size, my short positions are indeed small. I don't want to blow up accounts on short positions, all short positions combined never exceeded 10% of my portfolio (usually only around 5%).

PS: I won't talk about the new Canada fire incident that's making the rounds today ( Tesla Investigating Cause of Toronto Garage Fire With Model S - Bloomberg ). I still think the sample sizes are too small, one should have data sets over many years and with EVs from different brands vs ICE and PHEV cars. But if there are more TSLA incidents in a short period of time (as in late 2013) in the mainstream and financial press this could hit the stock again over the coming weeks.

 

[tftf]

I originally wanted to add the rest of my position (0.5x) after the earnings but will first await the separate giga-factory event (next week?).

PS: Buried in the news: The Model X was delayed into 2015, I always expected a very soft launch in late 2014 so it shouldn't matter. (At least that's how I read the newsletter, there will be no X customer deliveries in 2014).