Short-Term TSLA Price Movements - 2013

[DaveT]

... puts some label on their username signaling their bad feedback?

That's a brilliant idea, TSLAopt.

 

[JRP3]

You can't compare a Tesla to an Ipad. Cars are made to get you from point A to point B, and 5 years from now you will still be able to drive the Model S all over the world exactly the same as you can today. A 5 year old Ipad is no good on the other hand, because it doesn't have enough storage, new apps may not be compatible with it anymore, or new software has higher hardware requirements than a 5 year old Ipad might have.

I could not disagree any more with some of the opinions on this topic. Yes, the Model E or the new Model S 3-5 years from now will have some newer technology (like autopilot or AWD) but that is not enough to make an older model obsolete.

It is like saying that a 2012 Subaru Outback is obsolete, because the 2013 has push button start, memory seats, rearview camera, and several safety features called eyesight (lane departure, blind spot monitor, etc.). In reality these cars will be worth almost the same amount of money on the used car market. The 2012 might go for $18k and the 2013 for $21k or so.

All of the important stuff surrounding Model S will never get substantially better enough to make the old model useless: speed, acceleration, handling, etc. That is what makes a car. All of the other stuff, such as parking sensors, vented seats, etc. are just luxury items that really don't add much value to a used car.

If a Model S is built to last 200K+ miles, then it will for sure be worth more than 50% after 3 years and 30k miles on it. Guaranteed!

Spot on.

Resale value (of nearly any product) is predicated, essentially, on a lack of progress. When tomorrow's product is identical to today's, then the product holds its value.

Not in the case of vehicles. I've only bought used vehicles, and never once did I value those vehicles on what the newer version may or may not have, it's irrelevant. For your supposition to be true people would have to cross shop used and new vehicles of the same model, that doesn't happen. A 3 year old Model S will still outperform the majority of all vehicles, and it's 200+ miles of range will still be compelling for most people. Those people shopping a used S are not in the market to spend twice as much on a new one, no matter what range it may have or if it might get to 60 0.5 seconds sooner.

ICE drive train technology is rather stagnant, with only minor improvements each decade. The improvements expected in the electric drive train, particularly with range, are going to be significant. That's a good thing for the EV movement, but it'll have a significant negative impact on the resale value of early EVs.

The resale of my Model S is going to drop when Tesla plugs new tech into the 2016 Model S that gives it a 350 mile range and improves it's 0-60.

The only way your resale value will drop is if Tesla or someone else offers a similar vehicle with similar specs near the price of a used Model S. I think the likely hood of that happening in three years is minimal.

 

[ckessel]

Not in the case of vehicles. I've only bought used vehicles, and never once did I value those vehicles on what the newer version may or may not have, it's irrelevant. For your supposition to be true people would have to cross shop used and new vehicles of the same model, that doesn't happen.

If you don't cross shop any used item against new to decide the best bang for your dollar, then you're purposely putting on blinders.

Let's take an exaggerated example. Tesla has a major breakthrough in battery and drive train cost reduction and puts out a 700 mile range car tomorrow without changing price. What do you think your used 265 mile Model S is suddenly worth?

That same impact is going to occur, just at the more modest 8-10% range improvements expected per year rather than my exaggerated impact.

It's hard to compare this to historical ICE depreciation because the years of ICE engine technology advancing at 8-10% per year are decades past. Improvements there are very tiny increments each year. That's a big part of why EVs will absolutely crush ICE by the time Gen3 comes out. Today Tesla has shown it can build a competitively priced car that as good or better. In 5 years, Tesla will crush on both price and performance, not just compete, because EV advancement will leave ICE in the dust.

 

[JRP3]

bonaire is a troll, don't waste your time responding to him (or her).

FYI there is a "bonaire" on Seeking Alpha with a high FUD factor as well. I reserved judgement and thought I'd give him a chance to prove himself here before I mentioned it, and he has.

 

[InTheShadows]

We are way OT here.

 

[Discoducky]

FYI there is a "bonaire" on Seeking Alpha with a high FUD factor as well. I reserved judgement and thought I'd give him a chance to prove himself here before I mentioned it, and he has.

Also on TM forums with largely neutral posts bordering on problematic. Just FYI, but I only know of 3 troll-like contributors so I don't mind the 'opinions' unless it is causing unrest. The mod's do a great job, IMHO, when it 'crosses the line'

 

[ckessel]

We are way OT here.

Yea, sorry, I'm a major culprit on that. Guess it goes into the Long Term Fundamentals?

Back on topic, the price of options. Well, LEAPS, so maybe that's long term too. We were discussing a couple days ago that volatility increases the premium on options. Any rules of thumb for knowing when the implied volatility is reaching it's nadir and thus is a good time to buy options? TSLA can be crazy volatile, so does it's implied volatility ever die down much?

 

[TSLAopt]

Yea, sorry, I'm a major culprit on that. Guess it goes into the Long Term Fundamentals?

Back on topic, the price of options. Well, LEAPS, so maybe that's long term too. We were discussing a couple days ago that volatility increases the premium on options. Any rules of thumb for knowing when the implied volatility is reaching it's nadir and thus is a good time to buy options? TSLA can be crazy volatile, so does it's implied volatility ever die down much?

Most option market makers use the Black Scholes formula or some variation of it (ie. Binomial pricng model) to price options. You can google that to read more about it, but its a bit complex to explain/understand unless you are very familiar with the Greeks. I could be wrong but I think the previous 90 days volatility of the underlying stock is used somehow to price the option (or maybe I'm confusing this 90 days stat with 'Portfolio Margin' margin requirements for the stock).

On another side note with LEAPs, in November I believe the Jan 2016 LEAPs for TSLA should become available. Those will be very interesting to see how they are priced...probably will be very expensive.

 

[Cameron]

Im feeling like we are going to hit 200 sooner than later, maybe even this week if the overall market is good. Everyone seems to be talking about it and the volume might be coming back after last Thursday and Friday which is generally good for the stock. If it does I would suspect a fair amount of profit taking, but until then I think we will see some pretty explosive short term action.

 

[ckessel]

On another side note with LEAPs, in November I believe the Jan 2016 LEAPs for TSLA should become available. Those will be very interesting to see how they are priced...probably will be very expensive.

Where do I find when Jan2016 becomes available? The only link I can find seems to indicate it should be available now.

Monday, September 16, 2013: 2016 LEAPS begin trading for January cycle option classes. A notice listing the new LEAPS series will be distributed during the week of September 9th.

 

[sleepyhead]

Where do I find when Jan2016 becomes available? The only link I can find seems to indicate it should be available now.

Monday, September 16, 2013: 2016 LEAPS begin trading for January cycle option classes. A notice listing the new LEAPS series will be distributed during the week of September 9th.

It's Nov 11. Which is like the worst possible time because that will most likely be three days after Q3 ER. If Q3 is a blowout then Nov 11 will be the worst time to buy options; I expect ER to be on Nov 06.

 

[ckessel]

It's Nov 11. Which is like the worst possible time because that will most likely be three days after Q3 ER. If Q3 is a blowout then Nov 11 will be the worst time to buy options; I expect ER to be on Nov 06.

Would it make sense to load up on the Jan2015's before then and roll into the 2016's when they become available?

 

[Causalien]

Yea, sorry, I'm a major culprit on that. Guess it goes into the Long Term Fundamentals?

Back on topic, the price of options. Well, LEAPS, so maybe that's long term too. We were discussing a couple days ago that volatility increases the premium on options. Any rules of thumb for knowing when the implied volatility is reaching it's nadir and thus is a good time to buy options? TSLA can be crazy volatile, so does it's implied volatility ever die down much?[/QUOT]

I'll give you a few scenario as a basis of IV. But true understanding can only be gained after you've watched it for long enough.
The formula I use for calculating IV is different from what others uses. Other people's 100 is equals to my 1.
For most normal stocks IV of 0.4 is considered high volatility. For TSLA, 0.4 IV is on the low end. When IV is at around 0.4, you can sell a monthly option 3 strike out and still make decent money.

Take V for example. It is on a straight channel up, but its IV is super low in the 0.20 range. This is because its rise is so predictable that even if it reaches the top of the channel, the market maker that wrote the option can still fleece you. This is a case where buying the stock actually earns more than an option even if the stock went the direction that you wanted.

For TSLA, it has seen IV above 1 twice. Now when IV goes above 1, several funny things happen. The black scholes model changes into a multiplication effect instead of a decaying effect. Which means that all the theoretical option pricing goes out of whack on the ITM and near ITM options. I think when this happens, the market maker just go by their gut feeling. Maybe I made a mistake in my derivation of the Black Scholes formula, but that is the impression I got when I worked on it and also from my option trading experience. On any gap up, it is easy for TSLA to reach an IV of 0.8.

The other time when I see any stock's IV goes above 1 is when I was observing the bank stocks during the financial collapse.

My suggestion for any stock with IV above 1, is to short any type of option it has. I sold both call and puts when it happened just because I am 99% sure that IV will eventually fall below 0.8. Kind of like VIX will have 100% of going above 10 within any given year. Of course, the one time that this strategy might blow up in your face, is during the financial collapse on bank stocks. So exercise caution.

 

[Jack6591]

Trolls piss me off. However, when Julian was excommunicated from Seeking Alpha, I objected in a loud and clear voice. Freedom of speech, trumps all.

 

[Convert2013]

Also on TM forums with largely neutral posts bordering on problematic. Just FYI, but I only know of 3 troll-like contributors so I don't mind the 'opinions' unless it is causing unrest. The mod's do a great job, IMHO, when it 'crosses the line'

You guys are paying too much attention to Bonaire's comments...
Anywho, now getting back OT.. Am wondering what catalysts the remainder of September potentially holds for TSLA... hopefully Elon tweets on Europe and US sales performance as the quarter wraps up.

 

[hoang51]

I still find it amuzing that many people here have held on to TSLA through the three week consolidation period and as soon as the stock broke up 5% to ~$174 everyone is selling. This is the exact opposite of what you should be doing. This is a bullish breakout trade above $173.80 on high volume and this is a great entry point to buy.

I'll answer this because I was one of them. I was reviewing the previous time DB put out a report and the stock did about 10% across 3 days. This one we just experience in 2 days. So I was expecting a slow march upward and a pullback somewhere. That was why I would sell near the high at $174. While I was watching the morning opening, I saw that it reached to $172 really fast. I tried to log in and cancel my $174 sell order, but I was too late. The stock had rushed up past $174. At that point, I decided to just wait for a big drop instead of buying back in only to probably experience a drop in price in the next few trading days like usual (in my experience) where I wanted to re-enter.

I would like to warn you gus on buying options on the next "dip". Implied volitility will be very high, so the best time to buy is during a consolidation. Unless of course you get a 20% - 25% Goldman like dip, then you buy as much as you can.

Thanks for the warning. I just put in an application to do options with my broker. It seems that there's a pattern to follow with options with Tesla made easy by people like you that could profit more than just trading stocks alone. I will probably load the boat on the options when GS hammers out a report that looks like a downgrade.

 

[brianstorms]

Frankfurt's up. 136.5 euro, or about $184.63. Generally a good bellwether for TSLA on the Nasdaq.

 

[hoang51]

Frankfurt's up. 136.5 euro, or about $184.63. Generally a good bellwether for TSLA on the Nasdaq.

About 1.5 hours after your post, the price is sinking very slowly... It is 136.20 euro ($184.22) right now.

 

[MartinAustin]

Not that TSLA ever follows the general market... but if it will have any bearing on the USA markets, Germany's Angela Merkel won again and will be setting up a coalition government there, so to me that says "European stability" - which should be a good influence on the USA markets.

 

[Fast Laner]

Xetra / Frankfurt price and pieces (Xetra 15 min time delayed)

Tesla Motors Inc. | Aktie | A1CX3T | US88160R1014 | Brse Frankfurt

you might have to accept conditions at "ich stimme zu", but you won't get an inflatable washing mashine.:smile:

after " ich stimme zu" one gets to the main facts, there you go to "Kurshistorie" to get price and pieces.