Short-Term TSLA Price Movements - 2016

[Papafox]

But unfortunately there are smart longs (strong longs) and stupid longs (weak longs). Just like there are smart and dumd shorts. You have this continuum from worst to best: "strong short" - "weak short" - "weak long" - "strong long". But don't get your judgment clouded because you are a strong long - there are still too many weak longs.

While we certainly have a huge variation in how much emotion versus research various longs use in their decisions, there's also the issue of risk tolerance. I'm in a position with my life right now where I am quite risk tolerant, but others who have pretty much set their financial houses in order are less risk-tolerant because losing money makes a bigger difference in their lives than making money. To each their own. That said, with a very optimistic long-term outlook for TSLA right now, it makes little sense to sell shares on a dip. Strong longs should do better than weak longs over the coming years in terms of owning shares. Strategies with options is where the two types vary the most.

 

[Johan]

While we certainly have a huge variation in how much emotion versus research various longs use in their decisions, there's also the issue of risk tolerance. I'm in a position with my life right now where I am quite risk tolerant, but others who have pretty much set their financial houses in order are less risk-tolerant because losing money makes a bigger difference in their lives than making money. To each their own.

I don't think it's necessarily so that the weak or strong long difference stems from different risk tolerance in turn resulting from "having your financial house in order" or not. The first two steps are correct, bit the third is wrong: risk tolerance is not a result of "having your financial house in order" (i know my house is in order and I'd suggest that >98% of TSLA investors also have their houses in order). No it's because your risk estimates are different, not your risk tolerance. I percieve Tesla not making it really well as something that has a low risk of occuring, while a "weak long" assigns this possible scenario a higher risk.

 

[Papafox]

I don't think it's necessarily so that the weak or strong long difference stems from different risk tolerance in turn resulting from "having your financial house in order" or not. The first two steps are correct, bit the third is wrong: risk tolerance is not a result of "having your financial house in order" (i know my house is in order and I'd suggest that >98% of TSLA investors also have their houses in order). No it's because your risk estimates are different, not your risk tolerance. I percieve Tesla not making it really well as something that has a low risk of occuring, while a "weak long" assigns this possible scenario a higher risk.

We're both right to some degree. I'm sure you would agree that some investors have a lower risk-tolerance than others and therefore they will choose to trade differently than more risk-tolerant investors. I also appreciate what you're saying, though, because being a "weak" long often is caused by uncertainty about the risk vs. reward prospects and that uncertainty will work against the investor. In fact, at times like this with fairly low stock price, known catalysts ahead and much de-risking already behind TSLA, there's an argument for trading more aggressively in these circumstances because more aggressive trading now might carry less risk than less aggressive trading after the stock price has popped up.

 

[Johan]

We're both right to some degree. I'm sure you would agree that some investors have a lower risk-tolerance than others and therefore they will choose to trade differently than more risk-tolerant investors. I also appreciate what you're saying, though, because being a "weak" long often is caused by uncertainty about the risk vs. reward prospects and that uncertainty will work against the investor. In fact, at times like this with fairly low stock price, known catalysts ahead and much de-risking already behind TSLA, there's an argument for trading more aggressively in these circumstances because more aggressive trading now might carry less risk than less aggressive trading after the stock price has popped up.

... Except short term trading is not about being right about the company (that's for investing) but about understanding how the market as a whole is going to move in the short term (which really is most of the time not the result of the company being on the right or wrong path).

 

[geneclean55]

Regarding Brexit, the two most recent polls show a swing back to the remain camp. Personally, i am betting on a market bounce back this week, leading up to Tesla delivery numbers.

First Brexit Poll Since Jo Cox Killing Shows Remain in Lead

 

[EinSV]

A couple quick thoughts to toss into the mix on the S60 introduction.

First, Tesla would prefer not to do another cap raise, so they need more cash in the door between now and 2018. Introducing the S60 is an easy way to increase profits with little or no cap spend, allowing Tesla to raise cash for the Model 3 launch between now and the time they are ready to unleash GF cell production. With Fremont humming along, introducing the S60 should quickly ramp up sales, including by bringing in Model 3 reservation holders and others who will be tempted by the S60's lower price but might not spring for an S75D. Even if margins on the S60 are lower than the 75D, overall free cash flow should be higher due to increased volume.

Second, GF cell production should come on line later this year and hopefully will ramp relatively quickly. Not sure whether new GF cells will be used for Model S but if so, S60 battery cost should be at least $6K lower than recent S75s (conservative assumptions: $190 x 75 - $135 x 60 = $6150). So if/when GF cells are used, margins on the S60 may be comparable to recent S75 margins, even before accounting for streamlined production/reduced costs in Fremont. Another way to use the GF to print $.

 

[MitchJi]

Uncertainty over Brexit (macros) and the delivery numbers released ( I expect them to be excellent....18k is my prediction) coupled with evidence of the FUDsters pulling out all the stops has me 'short term' positioned with a strangle.
I hope the put part of that goes to 'zero'

I hope your put (I'm long) goes green big time in the next few days, and you sell, followed by a meteoric rise when the rest of us can do well.

 

[Rob_B]

But not much about Service Center expansion. I just would like to know if anyone heard anything new in that regard..

The service center in Bellevue is about to move to a new facility having a total square footage of between 4X and 5X the existing facility, based on my rough calculations. I walked around it yesterday. Even just considering the new service area alone, the new bays appear to have at least twice the area of the entire existing building. It would be interesting to know how many other facilities are getting upgrades, but this is definitely one of them. And, being on the West Coast, we're likely to see the Model 3 fairly early in the production phase, so I was glad to see some apparent preparation.

 

[dmckinstry]

... Except short term trading is not about being right about the company (that's for investing) but about understanding how the market as a whole is going to move in the short term (which really is most of the time not the result of the company being on the right or wrong path).

And IMO, much of short term movement for TSLA is irrational.

 

[JRP3]

But they're not giving it away - no dilution of current market by discounting, they're just expanding the market by offering a cheaper product with a really cool upgrade feature that is likely to bring in future revenue at minimal effort.

New 60 may have reduced margin but it increases addressable market by quite a lot. It will bring more revenue over time as some customers will be enticed to upgrade.

Some of the new "60" sales will certainly be people who were already going to buy the 75 but didn't really need the extra range. So they are getting the exact same vehicle for much less money, only missing the range they never needed in the first place. As to Tesla getting the extra value when they get turned in and enter the CPO program, yes they will get upgraded, but at that point in time, say average 5 years down the road, the extra kWh will have much less value as pack prices will have dropped substantially, (we assume). A kWh built today but "sold" in 3-5 years may sell at cost with no profit at all.

 

[MitchJi]

And IMO, much of short term movement for TSLA is irrational.

Exactly how is TSLA different than the overall market in that respect ?

 

[Johan]

And IMO, much of short term movement for TSLA is irrational.

Isn't that what I just said, what you quoted?

 

[dmckinstry]

Exactly how is TSLA different than the overall market in that respect ?

So true, except that much of the time TSLA movement is magnified. That's bothersome to many of us.

 

[MitchJi]

Another opinion (and more proof that the market is irrational - "true or fabricated"):
$TSLA Stock Action Turns Bearish

oks like the issues of the Customer Non-disclosure agreement revised at NHTSA request and the suspension / ball joint fiasco (whether true or fabricated) have canceled all the good will that resulted from Ron Baron’s disclosure of his $300 million investment.

$TSLA stock is now officially in “bearish” territory, with 5 consecutive Heikin Ashi red (negative) bars, the MACD gone negative, the MACD averages crossed the the bears, and finally the stock has dropped below the 200-day moving average. Which means I won’t touch TSLA stock for a while.

 

[sub]

Some of the new "60" sales will certainly be people who were already going to buy the 75 but didn't really need the extra range. So they are getting the exact same vehicle for much less money, only missing the range they never needed in the first place. As to Tesla getting the extra value when they get turned in and enter the CPO program, yes they will get upgraded, but at that point in time, say average 5 years down the road, the extra kWh will have much less value as pack prices will have dropped substantially, (we assume). A kWh built today but "sold" in 3-5 years may sell at cost with no profit at all.

If they are selling the 75 pack limited to 60 for .01 profit today then any extra money they get via CPO in the future is by definition extra profit.

I can see how this new 60 will draw in people, it enticed me back to the website to take another look and consider turning one of my Model 3 reservations into a model S. I really like the idea of having the option of increasing the range after I have the car for a while if I realize I need it.

 

[Ryo]

For those interested in casting their vote for Q2 deliveries I've created a poll: POLL: How many deliveries will Tesla make in Q2?

 

[Lessmog]

Hey JRP3 -- have you seen these Elon tweets about amphibious MS?
I guess you have since it was inspired by Watch a Tesla Model S drive (or swim) through a flooded tunnel [Video]


Elon Musk ‏@elonmusk 2 timför 2 timmar sedan


Tesla owner drives through a flooded tunnel & out the other side

Elon Musk ‏@elonmusk 2 timför 2 timmar sedan


We *def* don't recommended this, but Model S floats well enough to turn it into a boat for short periods of time. Thrust via wheel rotation.


Elon Musk ‏@elonmusk 2 timför 2 timmar sedan


If curious abt TSWLM car, am still planning to do a sports sub car that can drive on roads. Just a side project. Limited market potential

0 retweets 0 gillanden

 

[madodel]

Another opinion (and more proof that the market is irrational - "true or fabricated"):
$TSLA Stock Action Turns Bearish

With the shorts, API, the ICE makers and the auto dealers making up any lie and the pseudo financial press and the lazy assed publications that quote them verbatim, none of whom will make the effort to confirm the lies. So Tesla will be held to a higher standard of proof that they are performing well and even proof that the attacks are lies won't reverse SP drops, at best just keep it from going down more.

I look at it this way, those of us here can smell the deception when we see the trolls post it here and then use the same "evidence" in their fake articles attacking Tesla. So for us it is an edge that the overall market doesn't have. If I hadn't spent so much on my X a few months ago I'd have had cash to buy in at the last crazy big drop. These opportunities are why I follow this thread. RIght now I am just banking cash to buy more. The shorts and shills have proven their outright fraud works so you know they will do this again.

 

[JRP3]

Hey JRP3 -- have you seen these Elon tweets about amphibious MS?

Actually had not seen that. Of course I approve Though after reading the "Repairing a Flooded Model S" thread I'm not sure I'd do that with a Model S

 

[Chickenlittle]

Single data point but when I confirmed my modelX order I was told delivery late July but more likely August. My car has entered production early. Suspect factory hopping