Short-Term TSLA Price Movements - 2013

[erha]

+1 jcstp Ma Baker! Loved that vid! great tune for today...

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Wow! If short interest is only down 10% since the earnings announcement, does that mean that 30% of the float is still being shorted?
If so, this squeeze could still grow some legs!

I have no idea how they can conclude that it is down 10%, but that's pretty big news if it is true. Can't wait for those margin calls. I don't even know if its percentage points or just percent (about 4 percentage points). I guess it has to be percantage points though

 

[Sandman]

If you want to mitigate your risks, sell enough to cover your original purchase price. Once that's done, you are playing with "house" money, if it goes to zero, you still haven't lost anything, if it gets to $500, your still making lots of money, just not the absolute maximum possible, but you'll be able to sleep without worrying about your investment.

Good advice. Sold 1/3 of my TSLA late last week to take my original stash off. Then, quite unfortunately, initiated a bear call spread selling june 85 calls and buying june 60 puts to protect the rest of it. Good problem to have but I'm capped out at 85 and likely to get my shares called away unless it dips.

 

[TD1]

If you want to mitigate your risks, sell enough to cover your original purchase price. Once that's done, you are playing with "house" money, if it goes to zero, you still haven't lost anything, if it gets to $500, your still making lots of money, just not the absolute maximum possible, but you'll be able to sleep without worrying about your investment.

Sorry but your reasoning makes no sense, it sounds more like an advice from a degenerated gambler in Vegas.

There is no "house money" the stocks are in your name and have a value, so that value belongs to your name.
Taking profits for the sake of taking profits makes no sense.
Do it if you think the stock will go down or that your position in TSLA went over proportionally big since the big upswing.
Or any other reason that makes any financial sense.

 

[ShortSlaver]

Sorry but your reasoning makes no sense, it sounds more like an advice from a degenerated gambler in Vegas.

There is no "house money" the stocks are in your name and have a value, so that value belongs to your name.
Taking profits for the sake of taking profits makes no sense.
Do it if you think the stock will go down or that your position in TSLA went over proportionally big since the big upswing.
Or any other reason that makes any financial sense.

Well, TSLA has been more like a casino and less like a stock lately. It's just betting on when the squeeze will end. Some people bet it would end soon and sold and are out in the cold. Others will sell at just the right time. But most will be left holding the bag.

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Good advice. Sold 1/3 of my TSLA late last week to take my original stash off. Then, quite unfortunately, initiated a bear call spread selling june 85 calls and buying june 60 puts to protect the rest of it. Good problem to have but I'm capped out at 85 and likely to get my shares called away unless it dips.

You could close that covered call position. Will cost you, but if this thing goes over $100 (it seriously looks like it) it might be worth it.

 

[gregincal]

or that your position in TSLA went over proportionally big since the big upswing.

I believe this is the real reason why some people may want to sell some at this stage. A lot of people now have much more in Tesla stock than they expected to at this stage, and it makes sense to sell some to reduce risk.

 

[avatar]

Well, TSLA has been more like a casino and less like a stock lately. It's just betting on when the squeeze will end. Some people bet it would end soon and sold and are out in the cold. Others will sell at just the right time. But most will be left holding the bag.

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You could close that covered call position. Will cost you, but if this thing goes over $100 (it seriously looks like it) it might be worth it.

This is really key. Trying to predict the peak is the real problem. If you sell to early you leave money on the table. If you sell too late you might lose a high price and it might take 1+ year to get back to that same price not to mention the profits you could take to buy back more shares once the squeeze is over.

I'm actually super bullish about tesla but predict we are nearing the end. 77MM shares traded hands. It will stabilize around ~75 - 80 in my thoughts.

 

[rolosrevenge]

I'm curious if the naked float is still going on.

 

[bonnie]

Do it if you think the stock will go down or that your position in TSLA went over proportionally big since the big upswing.

Totally agree that there is no such thing as 'house money'. I treat profits the same as I treat money that I've earned through a paycheck ... with respect.

But I can't agree regarding various comments about selling TSLA because a portfolio has become skewed heavily there. I have financial goals each year -- and the rest of my portfolio is plugging away exactly as it should. TSLA is one of my wild duck s , it has far far exceeded expectations. Why should I sell it just because it grew a little too fast for comfort? The rest of my portfolio is right where it should be. If my goal for 2013 was to have (for example purposes only!) $1000 in my portfolio, divided up between income producing funds at 40%, growth at 40%, and 20% just wild ... and I have the $400 achieved in each of the first two categories, why should I care that that 20% hit $2000? Why would I sell it off? Maintaining a portfolio ratio seems arbitrary in that case.

Just my two cents.

 

[mitch672]

Sorry but your reasoning makes no sense, it sounds more like an advice from a degenerated gambler in Vegas.

There is no "house money" the stocks are in your name and have a value, so that value belongs to your name.
Taking profits for the sake of taking profits makes no sense.
Do it if you think the stock will go down or that your position in TSLA went over proportionally big since the big upswing.
Or any other reason that makes any financial sense.

It makes sense to ME, if his position has tripled, he can take 1/3 off the table, have his original investment cash back, and still be in for long term gains, without putting any of his original cash at any risk. This was especially important in my case, as I was using a rollover IRA in my brokerage account to buy TSLA, and although I am bullish on the long term prospects of TSLA, I'd rather have my original cash back, as, well CASH, thank you very much. More dry powder availble on a pullback, some tax-free gains locked in (IRA account). You don't have to maximize everything in life, sometimes it's best to be a bit conservative/reserved, you know, for when things perhaps get ugly.

P.S. this was not done for rebalancing, this was done to lock in enough profit to get back the original cash investment. I like my IRA heavily cash weighted, I am probably much older than many of you here, I plan to retire early in less than 2 years.

 

[deonb]

http://www.streetinsider.com/Analys...orsche-VW+-+Analyst/8332355.html?si_client=st

Interesting info:
"Under a very extreme bullish scenario, if Tesla can achieve a 20% operating margin and deliver 200,000 units, a price target of $307 per share could be justified, according to Morgan Stanley data."


Although that is 200'000 Model S's, or as much as all the Mercedes S-Class'es, BMW 7-series and Audi A8's sales combined worldwide.

However, considering the Tesla works out $25'000 cheaper in the US and > $50'000 cheaper in Europe, I won't think this un-reachable in 5 to 7 years. Just solve the recharge time perception problem.

Oh, and put in a CV gearbox for the German model... can't sell a car in Germany that only does 110mph.

 

[Johann Koeber]

Response to Bonnie:

I hear what you are saying.

But rebalancing forces you to sell high and buy low.

 

[bonnie]

Response to Bonnie:

I hear what you are saying.

But rebalancing forces you to sell high and buy low.

You're also gambling that you won't lose your postion. Sell high and maybe not be able to buy back in at a price that includes the gains you pay in taxes. Since I believe TSLA will go much higher over the next few years, I'm not in the mood to gamble with long-term growth.

 

[smorgasbord]

Portfolio Rebalancing is billed as a risk avoidance maneuver, but it can actually hurt long-term gains.

The pro for Rebalancing is that investment vehicles that have gone up rarely go up as much the next year. So, if you don't do anything, you end up more invested in things that won't significantly appreciate.

The con for Rebalancing is that you're making moves on a purely Technical basis, ignoring the fundamentals of your investments. Buy and Hold of great investments is how serious money is made. Look at Microsoft in the 1980s, Apple in the 2000's, etc. MS employees used to joke about $100,000 snow blowers (they sold some stock to buy a $5K snow blower and that stock then went up 20X during the rest of the decade). Is Tesla one of those companies?

How many people sold Apple at $100 or $200 and didn't get back in? Even with it down hugely from it's $700 peak, it's still over $450 today.

Rebalancing is a short-term risk avoidance thing, but by doing so it may actually be adding long-term risk. Are you adding money to losing stocks to bring their relative proportions in your portfolio to some threshold? That might work for Netflix, but it wouldn't have worked for Intel. In my view, it's better to look at your portfolio and decide based on fundamentals how you want your portfolio to look. Selling winners and adding to losers does not often make a great portfolio.

 

[ggr]

So the naked shorts are forced to buy Tesla stock. What do they do with it? If they just keep it, they will eventually make money and own a quality company. They only get clobbered if they turn around and dump it. If they keep it, how many voting shares will end in the hands of reluctant negative owners? Does it make any difference?

One of us is misunderstanding something. They are forced to buy, because they already sold it. So as soon as they buy it at market rate, they have to return it to whomever they borrowed it from, or sell it to me for $41 ;-), or something like that.

 

[CapitalistOppressor]

No. You might have other stock sales over the rest of the year that takes dives.

He should still do an estimate for capital gains and set aside enough money to cover it.

 

[rolosrevenge]

He should still do an estimate for capital gains and set aside enough money to cover it.

Unless you play with a Roth IRA like me, then you don't have to worry about such things, you just can't get your money out for a very, very long time (other than $10000 for a first house)

 

[ShortSlaver]

This is really key. Trying to predict the peak is the real problem. If you sell to early you leave money on the table. If you sell too late you might lose a high price and it might take 1+ year to get back to that same price not to mention the profits you could take to buy back more shares once the squeeze is over.

I'm actually super bullish about tesla but predict we are nearing the end. 77MM shares traded hands. It will stabilize around ~75 - 80 in my thoughts.

I'm betting at low 70's to mid-60's. If we see it fall to $70.00 I'm buying a ton of it. I think it's fairly priced there. However, I feel certain we will see $100 TSLA this week and it might not fall back. A large part of my position is gone at $80 so I'm willing to accept I might have left the party too soon. But I have cold hard cash so that's good too. If I can get in at $70 I'll strengthen my position. Until then, I'm holding and waiting.

 

[deonb]

Unless you play with a Roth IRA like me, then you don't have to worry about such things, you just can't get your money out for a very, very long time (other than $10000 for a first house)

I'm jealous... too late for me to Roth IRA. Sniff.


However, I think the other thing he could do is to sell anything that he has currently at a loss (SCTY comes to mind ), and immediately re-buy it. That way you can write off a current loss against the TSLA gain. You'd still have to pay tax on it in the future, but better to let things ride with tax-deferred money.

However, I *think* there is a time limit in terms of when it is legal to do that (sell-and-rebuy for a loss), but you can always change out a strait-up long position to a synthetic long if there is any issue.

I've been "lucky" in that I have a large capital loss carryover which would cover things up to now. Wooo-hooo hooo hoo... not really.. sob.

 

[avatar]

I'm betting at low 70's to mid-60's. If we see it fall to $70.00 I'm buying a ton of it. I think it's fairly priced there. However, I feel certain we will see $100 TSLA this week and it might not fall back. A large part of my position is gone at $80 so I'm willing to accept I might have left the party too soon. But I have cold hard cash so that's good too. If I can get in at $70 I'll strengthen my position. Until then, I'm holding and waiting.

I exited the party today at $84. I made an obscene profit as my average price was $36. Enough to buy several model S I looked at the volume and realized I'd rather leave a little too early than a little too late. The rise is happening fairly gradually but the drop could happen very quickly as the demand from shorts subsides. I too am sitting on a mountain of cash biding my time for this baby to come back down so that I can load up for the next round.

 

[voidptr]

However, I think the other thing he could do is to sell anything that he has currently at a loss (SCTY comes to mind ), and immediately re-buy it. That way you can write off a current loss against the TSLA gain. You'd still have to pay tax on it in the future, but better to let things ride with tax-deferred money.

However, I *think* there is a time limit in terms of when it is legal to do that (sell-and-rebuy for a loss), but you can always change out a strait-up long position to a synthetic long if there is any issue.

That's called a wash sale, and in the US, even selling and buying equivalent call options is a violation. You have to wait 30 days after selling to buy back in, and not have bought additional shares in the preceding 30 days, or the loss gets carried until you dispose of the new shares.