Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[Curt Renz]

A YouTuber comes to the conclusion that many media outlets actually shun Tesla because it does not pay for advertising. Surprise! Surprise! He points to a glaring example in the Sunday London Times of November 15.

Sam Alexander - Nov 22:

 

[Artful Dodger]

Is there any way this can't keep going up until Dec 21? With a guaranteed pull back after that?

Only if history repeats:

8 days in August:



8 days in November:



Hint: the August run was 15 days (not 8), and was fueled by just $5B in forced buying (not $50B).

TL;dr We're just about half way into this run. And the end is Dec 24, not Dec 21 (Index funds can buy +/- 3 days of the effective inclusion date)

Cheers!

 

[Skryll]

Also, it's a good rule to not sell any covered calls before any dramatic rises that are completely unexpected.

/s

Does it turn long stock that was held long enough for long term capital gains tax into short term capital gains when those calls convert ?

 

[dw4ngg]

Who gets to clean up the poop, the pee, and the puke after the ride?

Father Time

 

[Knightshade]

Does it turn long stock that was held long enough for long term capital gains tax into short term capital gains when those calls convert ?

Nope.

If you sold a call and it gets assigned you are required to sell them 100 shares at the strike price- how long you held those shares before said sale is how long you held em- the option aspect has no bearing on that.

In fact- even better-In a case where you get exercised- you add the premium you received when you wrote the call to the proceeds from the sale of the underlying asset at the strike price.

Your holding period for the underlying asset determines whether you treat the capital gain or loss as short- or long-term.

So you get to threat the premium as long-term cap gains if the underlying shares sold were as well.... (unlike if the option you sold expires worthless in which case the gain is short term no matter how long ago you wrote the option).

 

[StealthP3D]

Very few will buy an ICE due to brand loyalty, when they want an EV. if they can't get an EV, many will simply delay purchase, that should be a trend 2025-2035.

Those buying an ICE in 2030 are people that want an ICE even though gas stations are closing, fast chargers are everywhere, and EVs are better than ICE on every single metric, including purchase price. The word for that is hobbyist, or someone with a strong sense of nostalgia.

Exactly. We speak of a lot here of Tesla trying not to "Osborne" sales of one product with another, newer, better product. But the real Osborne effect is that EV's Osborne traditional ICE autos as people gradually figure out how superior an EV is to ICE. That is why legacy auto is dragging their feet on offering compelling EV's.

Tony Seba, someone who has extensively studied technological disruption over the decades, has graphed what is (very) likely to occur with new car sales as people become aware that gasoline cars are slow, stinky and weak. Undesirable, overly expensive for what you get and inconvenient. Guess what? A shortage of EV's does not cause people to buy a car that will soon be worthless, it causes them to wait. New car sales will drop while EV sales continue to climb as people defer paying a lot of money for yesterdays technology and capabilities.

All this Tesla "competition" that the idiots continue to say will be here any day now will never really arrive. Don't get me wrong, the EV's will arrive but they won't impact Tesla sales, they will displace gasoline car sales. That's why they are taking so long to get here. They are not competitive with Tesla based on features/price and to make them competitive with gasoline cars requires the makers of these EV's to sell them at slimmer margins than they can achieve on their gas cars. What this means is that EV's really are likely to have well over 50% of new car sales by 2030. Because as the cost to make an EV continues it's historic decline, it will be much easier to make an EV that is competitive with ICE (which are becoming slightly more expensive to make each year). There is no chance these cost curves are about to reverse and thus sales of ICE vehicles are soon to be relegated to a niche market regardless of the potential lack of any government regulations or subsidies (however unlikely). It's a good thing that modern ICE cars can actually often run 200,000 miles without major overhaul. Because as electrification takes over the auto market it will get to the point where most ICE cars still on the road are old beater ICE cars. At that point they will probably be legislated away as the toxic nuisances they are.

 

[Artful Dodger]

Damn, it would have hit at 525 595

FTFY. Now, wanna bet it hits 695 next week? And it's still a long way to Dec 24th.

TL;dr HODL

 

[johnm6875]

Something that I hadn’t thought about until your post, Tesla robotaxis will probably us AI, like their Autobidder. Therefore, the taxi fleet will always be properly spaced and located to minimize travel time and distance to the next predicted clients. Perhaps, the fleet will be so efficient that most pick ups will be nearly instantaneous. With camera vision, maybe one will even slow down, and wait for that stupid, slow human to finish typing the request into the app.

I foresee a time when I'm better at scheduling on my calendar and the system calculates when the Robotaxi should be at my door. It might even urge me to hurry-up because a traffic delay has been detected and I might be late. I rarely ever "call" for a Robotaxi it just knows when and where to be to haul me and my goods from one place to another. They don't even need to be close, they just need to know when to arrive. I think it would be cheaper to wait for me if I dawdle than to strategically place a bunch of cars "just in case."

 

[st_lopes]

This is from a few years ago - but they have done it before.

Canada Revenue Agency says it's still auditing high-balance TFSAs | Financial Post

"The tax agency contends that some Canadians are operating their TFSAs like a business and has set up eight criteria that can lead to an audit including frequency of trading, period of ownership, knowledge of securities markets, trading experience and time spent on an account. Some of those criteria tend to penalize people in the securities industry, say critics."

Im not an accountant, so perhaps some accountants like @st_lopes can chime in on this ?

A high balance in a TFSA could get you some attention (I suspect mine will). Though the bar for CRA to be able to recategorize your gains as taxable is fairly high. Note that the outcome of such a re-categorization is worse than just going from non taxable to capital gain treatment (eg 50% of gain being taxable), but rather they would treat the gains as business income (fully taxable).

In essence they would need to prove that you are trading on the account of income, or in other words that you have undertaken a business within the TFSA, which the examples you’ve listed would all be considerations.

Generally speaking those rules (which predate TFSA’s and are more commonly applied when trying to recategorize capital gains as business income) were designed to prevent realtors, professional money managers, and day traders from getting preferential tax treatment on their gains where their primary employment was already in that specific industry.

Where you are a passive HODLer, or even a more active investor with options and weeklies (though the line does get blurred here), but you continue to have a primary source of income unrelated to your investing, you’re generally on the safe side of that interpretation. Though I would suggest getting qualified tax advice if you are worried about that classification.

 

[jkirkwood001]

No offense to anyone holding FB, but I can’t understand how it’s STILL worth more than Tesla. It’s basically a webpage with a thumbs-up button and the most complicated logic is that if I know Joey, and Jesus knows Joey, then I know Jesus.

Meanwhile, Tesla is transforming the world and teaching cars to drive themselves. TSLA is clearly not overvalued at this level.

Personally, it's Apple I question the value of. Phone hardware is becoming commodity (how many pixels do you need in your image. Really.) And they don't get "it's the information, stupid" as well as Google. I know the vast majority will disagree with me on this (yeah, about $2T disagree!) Not an Apple hater. I just don't think they have done paradigm shift design in years. My $0.02 worth.

 

[Artful Dodger]

A fourth consecutive session of TSLA all-time intraday and closing highs

Indeed, 4th consequtive day of TSLA ATHs in all 4 categories:

• Open
• High
• Low
• Close

And, we're now up +43.5% over the past 8 sessions.

Cheers!

 

[Bet TSLA]

Indeed, 4th consequtive day of TSLA ATHs in all 4 categories:

• Open
• High
• Low
• Close

And, we're now up +43.5% over the past 8 sessions.

Cheers!

Yeah, kind of makes all the people saying "Who cares about the S&P? They need Tesla way more than Tesla needs them." look pretty dumb. It's quite clear that TSLA is better off (i.e. higher) now than before the S&P index committee admitted that Tesla exists.

 

[qphan79]

Nope.

If you sold a call and it gets assigned you are required to sell them 100 shares at the strike price- how long you held those shares before said sale is how long you held em- the option aspect has no bearing on that.

In fact- even better-In a case where you get exercised- you add the premium you received when you wrote the call to the proceeds from the sale of the underlying asset at the strike price.

Your holding period for the underlying asset determines whether you treat the capital gain or loss as short- or long-term.

So you get to threat the premium as long-term cap gains if the underlying shares sold were as well.... (unlike if the option you sold expires worthless in which case the gain is short term no matter how long ago you wrote the option).

I was thinking of selling January 2022 at the highest strike price in 2 weeks. If I buy to close them after more than a year, you’re saying that it’s still considered a short term gain?

 

[Artful Dodger]

Would sound even better with an ORGANA addition.

... or MAGNET

• MSFT
• APPL
• GOOGL
• NFLX
• ETSY
• TSLA

Cheers!

 

[MC3OZ]

Personally, it's Apple I question the value of. Phone hardware is becoming commodity (how many pixels do you need in your image. Really.) And they don't get "it's the information, stupid" as well as Google. I know the vast majority will disagree with me on this (yeah, about $2T disagree!) Not an Apple hater. I just don't think they have done paradigm shift design in years. My $0.02 worth.

IMO innovation establishes market share, brand retains market share.

Apple doesn't (yet) have a disruptive competitor with a superior product, Apple has managed to remain the superior product, though IMO competitors have substantially closed the gap. Unless a competitor is clearly superior, brand will win the day.
Tesla has a similar advantage in EVs, first impressions count, and happy customers are loyal customers.

I'm not sure just a better smart phone is enough to disrupt Apple, it needs to be a better experience.

I still think there is a possible niche for Tesla in phones, with great battery life, great battery longevity, great security, great integration with the Tesla eco-system. But this doesn't relate directly to mission so it is a low priority, or no priority.
I would trust Tesla to produce a better experience, I'm not sure anyone else can, but it is so far down the priority list, that it may never happen.

 

[JaredM3]

To those of you who responded to me I thank you very much, and those who reached out privately as well.

Another question, outside of options trading which there seems to be a lot of, does the majority continue to buy shares to add to your portfolio as well?

 

[TheTalkingMule]

... or MAGNET

• MSFT
• APPL
• GOOGL
• NFLX
• ETSY
• TSLA

Cheers!

Move Etsy and add Amazon for MAGENTA.

 

[Rammstein]

Who’s looking forward to putting a bed in the back of the Cybertruck and put it in self driving. So many fun things I can think of while in the bed and the truck is driving itself.

 

[Paul_SF]

Exactly. We speak of a lot here of Tesla trying not to "Osborne" sales of one product with another, newer, better product. But the real Osborne effect is that EV's Osborne traditional ICE autos as people gradually figure out how superior an EV is to ICE. That is why legacy auto is dragging their feet on offering compelling EV's.

Tony Seba, someone who has extensively studied technological disruption over the decades, has graphed what is (very) likely to occur with new car sales as people become aware that gasoline cars are slow, stinky and weak. Undesirable, overly expensive for what you get and inconvenient. Guess what? A shortage of EV's does not cause people to buy a car that will soon be worthless, it causes them to wait. New car sales will drop while EV sales continue to climb as people defer paying a lot of money for yesterdays technology and capabilities.

All this Tesla "competition" that the idiots continue to say will be here any day now will never really arrive. Don't get me wrong, the EV's will arrive but they won't impact Tesla sales, they will displace gasoline car sales. That's why they are taking so long to get here. They are not competitive with Tesla based on features/price and to make them competitive with gasoline cars requires the makers of these EV's to sell them at slimmer margins than they can achieve on their gas cars. What this means is that EV's really are likely to have well over 50% of new car sales by 2030. Because as the cost to make an EV continues it's historic decline, it will be much easier to make an EV that is competitive with ICE (which are becoming slightly more expensive to make each year). There is no chance these cost curves are about to reverse and thus sales of ICE vehicles are soon to be relegated to a niche market regardless of the potential lack of any government regulations or subsidies (however unlikely). It's a good thing that modern ICE cars can actually often run 200,000 miles without major overhaul. Because as electrification takes over the auto market it will get to the point where most ICE cars still on the road are old beater ICE cars. At that point they will probably be legislated away as the toxic nuisances they are.

And a way to accelerate the removal of the beaters is to provide a service that will make no sense to even have that beater.

 

[Oil4AsphaultOnly]

Thanks for sharing; I appreciated the brief discussion of volatility levels.

Like others here, I'm hoping to take advantage of a spike in price and volatility to sell some monthly covered calls in order to acquire more shares. However, the success - and rapid advancement - of Tesla's FSD beta has complicated this strategy. Should the FSD rollout continue to impress, what seemed like price levels inflated by S&P inclusion speculation may become the norm as the market begins to price in Tesla achieving FSD.

I expect the success of FSD testing to be stymied by regulations (too slow to approve its wide-scale use), so the stock price may not price that in yet. So the spike and follow-up volatility should last into the new year. That's what I'm trading on.