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Q3 After Hours Conspiracy?

Discussion in 'TSLA Investor Discussions' started by MikeC, Nov 5, 2013.

  1. MikeC

    MikeC Active Member

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    A few people noticed how rapidly the stock dropped after hours today, seemingly to me before the report was made available (and certainly before it could be read and digested).

    At 4:02:10 PM Eastern, the "after hours high" was $181.97: Tesla Motors, Inc. After Hours Trading - NASDAQ.com

    At 4:03 PM Eastern, yngwie_2012 posted he saw $163 in this post: Short-Term TSLA Price Movements - Page 1197

    I cannot see the trades made at 4:02 from that NASDAQ site, does anyone have access to them? Is that normal or possible? What time did the ER actually show up?
     
  2. RationalOptimist

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    I guess it's not widely known that computer algorithms process news releases and trade on them instantly. Literally in less than a second of their receipt. The algorithm is prepped by analysts to look for the key numbers from the release, including GM, guidance, etc. Imagine a much more elaborate version of DaveT's earnings preview...

    We can't compete on timing. But we may be able to compete on a more intelligent reading of the ER.
     
  3. sleepyhead

    sleepyhead Active Member

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    I think that these conspiracy theories are unwarranted.

    I was also not able to access the the shareholder letter before the stock started tanking even though I kept refreshing the Tesla website.

    But I had Bloomberg TV on and they got the information before the shareholder letter was up on teslamotors.com

    If there is anyone to blame for this mistake it is Tesla. If you are angry over this situation then you should write a letter to Tesla Investor Relations and let them know that this is unacceptable.

    I saw the Tesla results pop up on Bloomberg TV at least 1 or 2 minutes before the shareholder letter was made available on Tesla's website, and I am upset as well (at Tesla). I actually did not get it in my email until 4:17 EST.

    Even if you got the letter at the same time as everyone else, you still can't compete with the algos. Even algos can't compete with algos and that is why trading firms pay huge money to buy servers directly on the exchange; to get a few milliseconds advantage over other algo-bots.
     
  4. StapleGun

    StapleGun Member

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    I wonder what would happen if companies started adding invisible text and hidden characters between important numbers to throw off the bots that parse them.
     
  5. yobigd20

    yobigd20 Well-Known Member

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    in 2009 algorithmic trading was down below 125 microseconds...

    today, FPGA hardware is used to do the same in the sub-microsecond range. it is impossible for a user to manually trade faster than these systems. Plus the fact that these systems are collocated with the trade servers on ultra low latency networks just to beat competitors to the actual trade by a few milliseconds.

    good luck with your scottrade account lol

    well now that would be interesting....probably could be seen as manipulation of some sort as well as trigger another flash crash. lol
     
  6. austinEV

    austinEV Active Member

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    I have often wondered how hard it would be to just execute some large trade just at and after close without any regard to the content of the press release. The world is mainly and firstly looking for: red or green in the AH? If a market maker wanted to send the stock down for instance, just sell a largish (but modest for them) amount of shares right at the close. Then the direction is established and lots of bots and people trade on the forgone conclusion that the report was bad, then read it and figure out why. Once the trend is established it would seem to feed on itself. I had the same, but opposite impression at the Q2 release. I never really got why it was so awesome (good, but not THAT good). I more got the impression that everyone decided it was a green day and then read the report to build the narrative to why it was good.
     
  7. MikeC

    MikeC Active Member

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    Okay, I can accept the bots explanation. But then, like austinEV points out, if they have the power to make the stock lose 20 points in a minute why don't they just do that regardless of what the ER says?

    I guess I'm just hoping that this crazy drop was an anomaly and we'll recover back to where we were earlier today.
     
  8. Grendal

    Grendal Active Member

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    I just commented on this at Autoblog Green when someone was trashing Tesla and saying they were due to tank. Here was my comment:

    The 350 shortfall is from Deutsche Bank's own estimates, not Tesla's estimates. So Deutsche Bank created their own estimates (which did cause a 10% jump) which then created an artificial shortfall.

    Keep in mind that this is really just a loss of the increase that the bank created in the first place.

    And:


    Tesla said they would make 5100 cars this quarter. Most outsiders estimated they would come in ahead at 5500, which is what they did. Deutsche Bank said they would pull off 5850 on September 19th which caused a stock jump. So for Deutsche Bank, they were 350 short of their estimates. Tesla was 400 AHEAD of their own estimates.
     

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