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

[2daMoon]

Just woke up, got my coffee. (yaaaaaawn)

Was there something going on today? I forget.

Gonna get another coffee and try to remember what it was.

 

[dakh]

Can anyone who uses IBKR help me with this?

I have 2 options positions expiring today which, if they end up in the money, I do not have the ability to exercise.

However, I may want to hold these positions until minutes before market close, or even until after market close. Although I may sell them earlier during the day, I may want to sell them during the cross, or even short the stock in AH if the options are ITM, and then buy back the shares through exercising the options.

I just talked to the IBKR trading desk, and was informed that (as I suspected) these positions will be automatically closed by them, because I will be unable to exercise them. As early as 12:30 Chicago time... I asked them to not do so, but the best the person I talked to could do for me is put in a request to the risk department, which he informed me usually isn't granted.

I'm kind of at a loss, because it sounds like IBKR will close these positions automatically as early as 1:30PM if they are ITM. Does anybody know of anything else I can do? Worst thing that could happen is that I lose internet connection, the options expire ITM, and I don't have the margin to exercise them. I don't understand why IBKR would have a problem with this.

Yeah same boat here, best I can think of is to roll them forward 1 week before they get forcefully liquidated.

 

[Zero CO2]

Friend of mine has a Fidelity 401k and wants to invest in TSLA but they wont let him. How can he roll over into an IRA or something that will let him. He's still employed there.

Fidelity has a trading option in many 401K plans called "brokerage link"... have him look into brokerage link first ...I don't think you can trade options(not positive about this) there are some restrictions on what funds can be moved to brokerage link directly ...
I have a brokerage link account tied to my 401k ... it has 100% TSLA shares

 

[2daMoon]

Friend of mine has a Fidelity 401k and wants to invest in TSLA but they wont let him. How can he roll over into an IRA or something that will let him. He's still employed there.

If the friend meets the 59 1/2 years old IRS threshhold, they can roll 401K into an IRA. But it probably wouldn't be done in time to do any trading today.

 

[FrankSG]

Yeah same boat here, best I can think of is to roll them forward 1 week before they get forcefully liquidated.

I was thinking this would be too costly, but I guess they'll only get liquidated if ITM, and if they're ITM, they should be cheaper to roll-over.

If there's absolutely no way to reason with IBKR, I'll probably do this. Thank you!

 

[lascavarian]

They had Dan Ives at Wedbush on, who is bullish. Host was skeptical, but Ives called for $700 near-term and $1000 long-term.

Dan Ives did a really good job of concisely describing Tesla as a disruptive technology company playing in a trillion dollar developing market for their product. No reservations about coming competition etc. No reservations about earnings. A lot of green lights to invest would be an easy interpretation as I viewed his comments.

 

[Iain]

Fidelity has a trading option in many 401K plans called "brokerage link"... have him look into brokerage link first ...I don't think you can trade options(not positive about this) there are some restrictions on what funds can be moved to brokerage link directly ...

I have a brokerage link with fidelity and trade Tesla stock. I set it up years ago but as far as I remember it was easy to do.

 

[Cherry Wine]

So what do we think is going on in pre-market? Margin calls for shorts? Speculative buying? I doubt it's index funds.

 

[dakh]

Fidelity has a trading option in many 401K plans called "brokerage link"... have him look into brokerage link first ...I don't think you can trade options(not positive about this) there are some restrictions on what funds can be moved to brokerage link directly ...
I have a brokerage link account tied to my 401k ... it has 100% TSLA shares

Oh yes you can trade options in BL account. If not for that I'd be missing a digit in my account total figure.

 

[JBRR]

Margin account yes, but I don't have any margin.

Person on phone told me they'll liquidate them as early as 12:30 Chicago time

I don't want them exercised. In total the options would cost ~4.5x my current account value to exercise.

I'd just like them to not automatically exercise and not liquidate them to protect from auto exercise.

The person on the phone seemed to tell me I couldn't stop the liquidation, but I'll try calling again around 10AM or 10:30AM to try to reason with them again. I'm guessing they'll be too busy around open to answer my call.

roll em?

 

[ggr]

Margin account yes, but I don't have any margin.

Person on phone told me they'll liquidate them as early as 12:30 Chicago time

I don't want them exercised. In total the options would cost ~4.5x my current account value to exercise.

I'd just like them to not automatically exercise and not liquidate them to protect from auto exercise.

The person on the phone seemed to tell me I couldn't stop the liquidation, but I'll try calling again around 10AM or 10:30AM to try to reason with them again. I'm guessing they'll be too busy around open to answer my call.

I'm afraid there's something I just don't understand about this conversation. What I think I understand is that you have in-the-money call options, but not enough capital/margin to exercise them on close. But if they're in the money, just sell them before close? Or sell enough of them to raise cash to exercise the rest? Note that "liquidate" in this context just means they sell them for you... you don't lose them or anything.

 

[Vad42]

What peak price will TSLA reach tom... - Poll Results - StrawPoll

Well looks like the 5-10% group leads the way, though there is a quite a fat tail toward the higher %'s.

It's almost as if no one really knows what will happen It's already +2.5% premarket and climbing.

I hate to break the HODLer ranks around here, but I'm planning to sell 10-20% of my holdings between today and Monday. I "need" to buy a lot of expensive toys next year, and hell, after all YOLO, and you can't take it with you when it's all over.... And I don't subscribe to the people saying you will regrets selling and buying CyberTruck (for example), because in 5 years you'll say it costs you 500,000. Maybe true, maybe not, but whatever, I'd rather have it now and enjoy it, and not worry about where the price will be tomorrow or borrow too much against that. Who knows what will happen in future..

 

[Johan]

So what do we think is going on in pre-market? Margin calls for shorts? Speculative buying? I doubt it's index funds.

Margin calls yes maybe. Short term traders traying to again front-run the whole thing? I agree probably not the index funds. Did you see my question about your DITM calls being excercised? Maybe a lot of people experience this and perhaps are holding such positions naked - so they need to go out and actually buy the stock in order to deliver???

 

[Opus BC fan]

 

[Boomer19]

Can anyone who uses IBKR help me with this?

I have 2 options positions expiring today which, if they end up in the money, I do not have the ability to exercise.

However, I may want to hold these positions until minutes before market close, or even until after market close. Although I may sell them earlier during the day, I may want to sell them during the cross, or even short the stock in AH if the options are ITM, and then buy back the shares through exercising the options.

I just talked to the IBKR trading desk, and was informed that (as I suspected) these positions will be automatically closed by them, because I will be unable to exercise them. As early as 12:30 Chicago time... I asked them to not do so, but the best the person I talked to could do for me is put in a request to the risk department, which he informed me usually isn't granted.

I'm kind of at a loss, because it sounds like IBKR will close these positions automatically as early as 1:30PM if they are ITM. Does anybody know of anything else I can do? Worst thing that could happen is that I lose internet connection, the options expire ITM, and I don't have the margin to exercise them. I don't understand why IBKR would have a problem with this.

if the problem is cash/margin < cost to exercise the simple answer is if ITM, OCC rules are auto-ex anything .01 or more ITM

then you’d end up in deficit
but IB credit manager would automatically liquidate portfolio positions until the deficit was neutralized +/- haircut (buffer) depending upon portfolio margin, reg T margin, and concentration of assets within portfolio

the mid-day explanation from service desk may mean that they actually anticipate the credit deficit prior to exercise, and will manage it prior to close, meaning they’d rather liquidate portfolio positions during regular trading than after hours when liquidity is tighter.

i’d imagine this is a standard automated procedure and that they aren’t handholding specific scenarios like tesla inclusion for example. i doubt they have the manpower to manage one-offs, and i imagine other e-brokers are similar, or worse, they don’t even have automated credit managers

 

[FireMedic]

Some here have speculated about a post inclusion sell off. If that happens, the indexes need to buy more shares in order to re-balance at that 1 1/2 percent? Right

Example; if they bought at $750 and it drops back to $650. Would they need to buy more chairs? And vise versa; if it continued to rise they would need to sell chairs to maintain that %...correct?

 

[corduroy]

So what do we think is going on in pre-market? Margin calls for shorts? Speculative buying? I doubt it's index funds.

FOMO crowd who are just hearing about the S&P inclusion today?

 

[dakh]

I'm afraid there's something I just don't understand about this conversation. What I think I understand is that you have in-the-money call options, but not enough capital/margin to exercise them on close. But if they're in the money, just sell them before close? Or sell enough of them to raise cash to exercise the rest? Note that "liquidate" in this context just means they sell them for you... you don't lose them or anything.

The issue is if you expect a 3:55 spike and want to have exposure to it with those options. If you broker liquidates them before 355 you miss out.

 

[Boomer19]

Margin account yes, but I don't have any margin.

Person on phone told me they'll liquidate them as early as 12:30 Chicago time

I don't want them exercised. In total the options would cost ~4.5x my current account value to exercise.

I'd just like them to not automatically exercise and not liquidate them to protect from auto exercise.

The person on the phone seemed to tell me I couldn't stop the liquidation, but I'll try calling again around 10AM or 10:30AM to try to reason with them again. I'm guessing they'll be too busy around open to answer my call.

ib and other brokers don’t decide what to exercise. there are OCC rules for expiring options. if ITM by .01 or more, they auto-ex at occ participant level (brokers banks etc)

 

[avoigt]

Greenpeace:
"According to VW, 54,000 orders for the ID.3 had been received across Europe by the end of November, and 28,000 vehicles had been delivered.

In total, only 7,349 ID.3s have been registered in Germany since deliveries began. Of these, over 3,000 were own registrations, i.e. cars registered to VW itself or to VW dealers.

Considering that there were already 33,000 (non-binding) pre-orders for the introductory version of the ID.3 in 2019, this figure is disappointing."

The VW new agency Model disincentivizes selling a BEV.
According to sources from dealers, is the average margin for an ICE 14% but for a BEV just 6%

8% less margin is a lot of money for a dealer and explains why they continue to recommend ICE instead of BEVs

Greenpeace ID.3 mystery shopping at VW Dealerships

"I am interested in a new car. I am still open about the model and drive train. My budget is up to 35,000 euros after all discounts. Which car would you recommend to me?"

Dealer Recommendations
17 ICE
1 ID.3

https://twitter.com/alex_avoigt/status/1339895591313260546