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

[Cape Coddess]

Do the current sellers not like money?

A year from now we'll be seeing newbies posting that they sold at the S&P inclusion and had to buy back in at a higher price. You know how it goes

 

[2daMoon]

Does this saw blade have the right tooth count for cutting Shorts?

 

[jamaatta]

Well, Nordnet.se also went down a few mins ago.

Nordnet.fi is also down.

 

[samppa]

Just dropped my car off for service. Parking lot full of cars, and a trailer fully loaded. Service staff said they are very busy with lots of deliveries. On the sad side, my loaner P85D is locked in chill mode.

If you have a fakra cable, I can unlock it for you, you just need to pull IC and connect from there

 

[TheTalkingMule]

Yeah, I think that that + delta hedging mechanisms should be plenty to give it a decent squeeze this week, even if sellers show up at $650+.

So far it's pretty bullish to me that we're up 4-5% on such low volume.

In my mind we're also gonna see a lot more "faux selling" than the level of real selling MM's and others are counting on at inclusion. I and others looking to capture value in this spike, but not necessarily sell, are diving into covered calls. Personally I'm planning to sell against all my shares if the strikes extend out far enough for Jan 2022.

My attachment to Tesla as an organization has a dotted line to my TSLA holdings, but above say a $1T valuation in 2020 I start to see things as a bit short term irrational. But spiking to where I think we'll spike($850ish) is not nearly enough for me to sell. I will however sell 25% of my shares in 2021 at 30% above that spike, another 25% of shares at 50% above spike, and so on. With the plan to eventually piece my original holding back together down the line in a macro downturn.

To me this is the logical HOLDer's way to monetize the spike and I think a LOT of people will do the same. Buying calls periodically starting in September trying to capture this inclusion rise has paid off, now selling long calls way OTM makes a lot of sense if you pretty much just want to hold for the next couple years, but still gain profits from a spike we're "sure" is coming.

So the question is, if the expected selling at $800+ does not appear, but rather a ton of deep OTM covered calls......doesn't that only make things worse via massive forced MM hedging?

 

[Cape Coddess]

If anything, it looks like capping on the downside to me. Seems to me like somebody is very carefully buying up every time it drops below $xxx, and ups this limit by a few $s every so often.

That's how I like to do it, but I swear it's not me. I'm just sitting back and watching the show this week...so far.

 

[M|S|M MYP]

Sounds bullish to me:

 

[Cape Coddess]

Rrrggh...Schwab is down.

I think they just did an update during the night. It must have gone wrong.

 

[mongo]

Food for thought:

NOT INVESTMENT ADVICE!!!

Say you have 200 $TSLA shares and want to sell @$1k
Tax rate is 25%
So you get $200k - $50k = $150k
if $TSLA goes down 20% to $800, you want to buy back in because you are really, really proud of yourself that you sold and $TSLA is now down 20% and you are buying it back at a discount, so you buy 200 shares @$800 for $160k
So the net result is you are -$10k for thinking you can time the market.

Only if your basis was $0.
If you bought the 200 shares at 600:
(1000-600)= 400 * 200*25% = $20k in tax, $180k in cash
Buy in back in at $800: 200*800 = $160k.
You still have 200 shares, plus $20k additional in cash.
And your new basis is $800 for when you sell in the future.

 

[cusetownusa]

Food for thought:

NOT INVESTMENT ADVICE!!!

Say you have 200 $TSLA shares and want to sell @$1k
Tax rate is 25%
So you get $200k - $50k = $150k
if $TSLA goes down 20% to $800, you want to buy back in because you are really, really proud of yourself that you sold and $TSLA is now down 20% and you are buying it back at a discount, so you buy 200 shares @$800 for $160k
So the net result is you are -$10k for thinking you can time the market.

Wouldn't it be more nuanced than that? Depends if the gains are short-term versus long-term and what the cost basis is. Plus, if they were lucky enough to time it like that, then the new shares would be at a much higher cost-basis.

Ultimately, if someone was able to time this then I would assume they would come out ahead. Although, there are a lot of factors so not even going to try and do the math.

However, the tricky part is timing it correctly. Not worth the risk in my opinion, especially if you are dealing with short-term gains and a high tax bracket due to having income from a job. Downside is to great with not much upside.

 

[Prunesquallor]

Food for thought:

NOT INVESTMENT ADVICE!!!

Say you have 200 $TSLA shares and want to sell @$1k
Tax rate is 25%
So you get $200k - $50k = $150k
if $TSLA goes down 20% to $800, you want to buy back in because you are really, really proud of yourself that you sold and $TSLA is now down 20% and you are buying it back at a discount, so you buy 200 shares @$800 for $160k
So the net result is you are -$10k for thinking you can time the market.

You only pay cap gain taxes on the gains.
edit: @mongo beat me to it.

 

[Artful Dodger]

Bipartisan group to release Covid relief bill as Congress faces pressure to send help | CNBC.com (54 min ago)

 

[Knightshade]

I think you're just misunderstanding the notion of 0. Now and in the past, 0 interest in TSLA meant they didn't own TSLA. It's too hard. These people are very conservative, low risk. If you're benchmarked against an index with no TSLA then there's no point in fooling around with TSLA.

I think you're misunderstanding what benchmarked against means.

It means they want to beat the results of the index.

Why would you mirror something you are trying to do better than?

They held 0 TSLA because they felt it would not help them BEAT the index results.

If a managed fund that charges significant fees were to report "Hey we exactly matched the returns o a passive S&P index fund!" their customers would wonder WTF they're spending their money on with those fees.

Buying into stocks NOT in the index is literally the only way to beat it

But as soon as the benchmark buys TSLA, then the new 0 is owning exactly the same percentage. So if you are a conservative, low risk fund manager then you buy TSLA to be equal weight with the benchmark, and since it's too hard you never think about it again.

Again- how does that make any sense?

At that point they're just a passive index fund- not an actively managed fund trying to beat the index.

If you want to BEAT the index, mirroring it is exactly the way to insure you fail at your one job.



So pre-inclusion, an active fund manager either thought TSLA would do worse than the index as a whole, and bought 0.

Or she thought it would beat the index as a whole and bought shares (see ARK as the most obvious example of such a fund).

The same is true post inclusion.

 

[M|S|M MYP]

You only pay cap gain taxes on the gains.
edit: @mongo beat me to it.

This is why i just HODL and play 'dead' and buy on dips

 

[Lessmog]

Nordnet.fi is also down.

Looks to my unschooled eye like the auth service agent is down, making login impossible. They recommend phoning in if you need to trade.

Earlier today, Google was reportedly also down for a half hour or so -- all except for search.

Wonder if there is a sinister actor behind both? Timing seems a bit sus ...

 

[TheTalkingMule]

Can we give it a rest with the incessant "timing the market is difficult" and "leverage via options is risky" nonsense? If people don't understand that, they deserve to lose their investments.

Inclusion Week is finally upon us!

 

[Nocturnal]

Buying into stocks NOT in the index is literally the only way to beat it

Changing up the weighting of those stocks is a way to beat the index. i.e. double up on Apple and own half as much Stock X. Not buying Tesla now is an active choice, in that they believe Tesla will underperform. Previously they could just ignore it. Now they have to actually take a position. Buy less than the index, buy more, or buy the same. The last is the easy option.

 

[Dreadnought]

Buying into stocks NOT in the index is literally the only way to beat it

Not correct. One can also beat the index by not buying stocks that are in the index but underperform.

 

[Tslynk67]

Volume is miniscule. Like some of the lowest we've seen since announcement. Nothing is happening so far. This doesn't mean nothing will happen all day, but it could be that nothing happens until later in the week. Time will tell.

Volume on 18Dec calls from $600 all the way to $800 is very high though. I'd guess that people are adding to their positions and tightening up the coil further. But it won't be unwound until entities show up who buy the actual stock.

Volume doesn't look too bad, in any case, we're 4% up without obvious buying-frenzy, I'll take that fro the moment...

 

[Cape Coddess]

Does this saw blade have the right tooth count for cutting Shorts?

View attachment 617616

THAT is a thing of beauty. Gave me heart palpitations.