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

[mejojo]

They seem to be caught up in this impeachment thing right now.

No. Impeachment is a separate effort. The Senate is not a blocker at this time. When the bill is passed to the senate, only 20 hours of debate are allowed, so the timeline is not long.

 

[asburgers]

In the article he links it says:

a) If NOPE is high negative — This means a ton of put buying, which means a lot of those puts are now worth more, and a lot of calls are now worth less/worth less (due to price decoherence). This means that to stay delta neutral, market makers need to sell/short more shares, pushing the stock price down.

It's important to preface this that the condition you quoted was if "Stock Meets/Misses market Expectations (aka price goes down)". It's the opposite if the "Stock Meets/Exceeds Market Expectations (aka price goes up)".

Summarizing her points:
1) If Stock Meets/Exceeds Market Expectations (aka price goes down) - hedging actions push the stock price up regardless of whether NOPE is high negative or high positive.
2) If Stock Meets/Misses Market Expectations (aka price goes down) - hedging actions push the stock price down regardless of whether NOPE is high negative or high positive.

It's a great article with a lot of thought put behind it, but I really need to stew on the usefulness of this conclusion. The formula is dope though.

 

[Nocturnal]

Could we "Sell" these to each other? One week I buy yours. The next week you buy mine? Or can only MM's do that...

I just sold a bunch of 3/19 $20s. You can buy those if you like.

 

[buttershrimp]

So, I think I've busted Edmunds and their EV 'real world range' tester/author, Jonathan Elfalan. Here is the article from Tuesday claiming that Tesla's ranges are way over-rated by the EPA:

Edmunds Tested: Electric Car Range and Consumption | Edmunds

Well that looked pretty grim, but it got me remembering - didn't Edmunds do a comparison of 'real world range' between the Model Y and the Taycan back in November 2020? Why yes, yes they did, and it was done by the same author, Jonathan Elfalan. Here it is:

Tesla Model Y vs. Porsche Taycan: Testing EPA Range in the Real World | Edmunds

Hm, that's interesting - why is this article I remember from November 2020 now dated February 3rd, 2021? To the Wayback Machine!
Here is the archived version of the original article as posted on November 19, 2020:

Tesla Model Y vs. Porsche Taycan: Testing EPA Range in the Real World | Edmunds

What's this? It's different! The testing methodology and result for his Model Y range has been altered! Apparently Jonathan didn't know the original article would be archived..

In the original article from November (near the bottom):

Max Battery Usage
A key difference between Tesla and other companies is that it makes more of its battery available for use. Electric vehicle batteries that are constantly charged to their maximum capacity tend to degrade quicker over time, so manufacturers including Porsche place stricter limits on charging and use. Tesla leaves it up to the owner's discretion and simply recommends that the max battery charge only be used for longer trips. Otherwise, it says owners should use a charge of around 90% for daily use.

The 90% charge is what Edmunds followed for its Model Y test as, again, it represents how the majority of Tesla drivers will use their car. Extrapolated out, Edmunds estimates that charging the Y's battery to its maximum capacity would have added 25 miles to its as-tested range.


That section of the article has now been changed to:

Max Battery Usage
A key difference between most luxury and mainstream electric vehicles is that luxury brands typically make more of a car's battery available for use. Electric vehicle batteries that are constantly charged to their maximum capacity tend to degrade quicker over time, so some manufacturers place stricter limits on charging and use. Both Porsche and Tesla leave it up to the owner's discretion and simply recommend that the max battery charge only be used for longer trips. Otherwise, it says owners should use a charge of around 80% to 90% for daily use.

In the interest of aligning our range testing with the EPA's estimates, which take 100% of the nominal battery capacity into account, Edmunds charges all electric vehicles to their maximum allowable capacity. You can view the real-world range for every electric vehicle Edmunds has tested here. For vehicles that have a suggested lower daily charge such as the Taycan and Model Y, there is an asterisk next to the range figure. For others without an asterisk such as the Ford Mustang Mach-E, the max range can be used on a daily basis.


So in the original article he says he charged the Taycan to 100%, but the Model Y to only 90%, because that's what they suggest in the manual for normal use. Apparently on February 3rd he realized that this was an obviously unfair way to compare the vehicles and he didn't want to risk losing credibility before releasing his new article, so he went back in time and actually charged the Model Y to 100% for the test he did last November! Comparing the altered article to the original we see he has also made up new results for the Model Y range:

Original version:

• TLDR: The Taycan beat the Model Y by a whopping 70 miles in our testing, yet the EPA says it should lose by 88 miles. So what gives?

Altered version:

• TLDR: The Taycan beat the Model Y by 55 miles in our testing, yet the EPA says it should lose by 88 miles. So what gives?

Looks like he gave the Model Y an extra 15 miles of range. How generous of him! But, oh no, he screwed up. Looking further through the article we see:

Original version:

The 2020 Porsche Taycan 4S, an all-new electric luxury sport sedan, was way off from the EPA estimated 203 miles of range in Edmunds' real-world driving test. Edmunds observed 323 miles and saw a better energy consumption of 32.3 kilowatt-hours of electricity used every 100 miles of driving, versus the EPA's 49 kWh/100 miles.

In contrast, the 2020 Tesla Model Y Performance with 21-inch wheels — the brand's newest small SUV — did exceptionally well in the EPA's test, earning a range estimate of 291 miles and a power consumption rating of 28 kWh/100 miles using the maximum range mode. While Edmunds saw comparable efficiency in its real-world test, at 28.4 kWh/100 miles, the overall range result of 253 miles was slightly lower than the EPA estimate.

Altered version:

The 2020 Porsche Taycan 4S, an all-new electric luxury sport sedan, was way off from the EPA estimated 203 miles of range in Edmunds' real-world driving test. Edmunds observed 323 miles and saw a better energy consumption of 32.3 kilowatt-hours of electricity used every 100 miles of driving, versus the EPA's 49 kWh/100 miles.

In contrast, the 2020 Tesla Model Y Performance with 21-inch wheels — the brand's newest small SUV — did exceptionally well in the EPA's test, earning a range estimate of 291 miles and a power consumption rating of 28 kWh/100 miles using the maximum range mode. While Edmunds saw comparable efficiency in its real-world test, at 28.4 kWh/100 miles, the overall range result of 263 miles was lower than the EPA estimate.


So in one place in the article he gave the Model Y an extra 15 miles of range, but here he's only giving them an extra 10 miles. Woops! Interestingly, in the original article he even states that if he had charged the Model Y to 100% it probably would have given the Model Y an extra 25 miles of range (makes sense since that's about 10%). In the altered version he only gives them 10 or 15 miles depending on where you look, so he is clearly biased against Tesla and wants to give them as little range as possible in his new made up numbers.

So unless I'm missing something, he's altered his methodology for a past range test and made up new numbers go with it. This is the same guy running these new tests, where he could be accelerating and braking in different ways for the different test vehicles, or just be making up numbers entirely.

By the way February 4th, the day he altered that old article? That was the day before all that unusual put option activity on Friday February 5th. He then released his new article on Tuesday. Someone made a lot of money on those puts!

Perhaps Fred will write an article calling him out? Lol

 

[mekberg]

Zach using Tesla's newly-created block-chain technology to issue 1:1 digital shares which can't be counterfeited by naked shorting, and have their entire chain of custody encoded into the cyrpto-key for each share...

Yeah, that'll work.

Cheers!

That’s an intriguing idea. Do you know how feasible this is from a regulatory point of view? The technical side is pretty straightforward.

 

[Prunesquallor]

The bigger question is why are politicians looking at a new EV tax credit law that still limits how many cars an individual manufacturer can sell before the credit goes away? Do we want more EVs and cleaner air or not? The EV credit should exist for X number of years - period. Don't punish the manufacturers that are doing a better job of making and selling cars!

It may have to do with the limitations of the reconciliation rules. The bill must be, at worst, deficit-neutral. So this may represent the largest loss of tax revenue that could be offset in other areas.

 

[StarFoxisDown!]

Yeah.....this is definitely going red today. Can't even maintain buying volume for an hour

Oh well. I think we should expect to spend some time in the 700's at this rate. Might have to wait till Q1 P/D to really get a catalyst

 

[EVMeister]

Yeah.....this is definitely going red today. Can't even maintain buying volume for an hour

Oh well. I think we should expect to spend some time in the 700's at this rate. Might have to wait till Q1 P/D to really get a catalyst

Whenever somebody says something will "definitely" happen here, the opposite often happens. So thank you!

 

[SOULPEDL]

So, I think I've busted Edmunds and their EV 'real world range' tester/author, Jonathan Elfalan. Here is the article from Tuesday claiming that Tesla's ranges are way over-rated by the EPA:

Edmunds Tested: Electric Car Range and Consumption | Edmunds

Well that looked pretty grim, but it got me remembering - didn't Edmunds do a comparison of 'real world range' between the Model Y and the Taycan back in November 2020? Why yes, yes they did, and it was done by the same author, Jonathan Elfalan. Here it is:

Tesla Model Y vs. Porsche Taycan: Testing EPA Range in the Real World | Edmunds

Hm, that's interesting - why is this article I remember from November 2020 now dated February 3rd, 2021? To the Wayback Machine!
Here is the archived version of the original article as posted on November 19, 2020:

Tesla Model Y vs. Porsche Taycan: Testing EPA Range in the Real World | Edmunds

What's this? It's different! The testing methodology and result for his Model Y range has been altered! Apparently Jonathan didn't know the original article would be archived..

In the original article from November (near the bottom):

Max Battery Usage
A key difference between Tesla and other companies is that it makes more of its battery available for use. Electric vehicle batteries that are constantly charged to their maximum capacity tend to degrade quicker over time, so manufacturers including Porsche place stricter limits on charging and use. Tesla leaves it up to the owner's discretion and simply recommends that the max battery charge only be used for longer trips. Otherwise, it says owners should use a charge of around 90% for daily use.

The 90% charge is what Edmunds followed for its Model Y test as, again, it represents how the majority of Tesla drivers will use their car. Extrapolated out, Edmunds estimates that charging the Y's battery to its maximum capacity would have added 25 miles to its as-tested range.


That section of the article has now been changed to:

Max Battery Usage
A key difference between most luxury and mainstream electric vehicles is that luxury brands typically make more of a car's battery available for use. Electric vehicle batteries that are constantly charged to their maximum capacity tend to degrade quicker over time, so some manufacturers place stricter limits on charging and use. Both Porsche and Tesla leave it up to the owner's discretion and simply recommend that the max battery charge only be used for longer trips. Otherwise, it says owners should use a charge of around 80% to 90% for daily use.

In the interest of aligning our range testing with the EPA's estimates, which take 100% of the nominal battery capacity into account, Edmunds charges all electric vehicles to their maximum allowable capacity. You can view the real-world range for every electric vehicle Edmunds has tested here. For vehicles that have a suggested lower daily charge such as the Taycan and Model Y, there is an asterisk next to the range figure. For others without an asterisk such as the Ford Mustang Mach-E, the max range can be used on a daily basis.


So in the original article he says he charged the Taycan to 100%, but the Model Y to only 90%, because that's what they suggest in the manual for normal use. Apparently on February 3rd he realized that this was an obviously unfair way to compare the vehicles and he didn't want to risk losing credibility before releasing his new article, so he went back in time and actually charged the Model Y to 100% for the test he did last November! Comparing the altered article to the original we see he has also made up new results for the Model Y range:

Original version:

• TLDR: The Taycan beat the Model Y by a whopping 70 miles in our testing, yet the EPA says it should lose by 88 miles. So what gives?

Altered version:

• TLDR: The Taycan beat the Model Y by 55 miles in our testing, yet the EPA says it should lose by 88 miles. So what gives?

Looks like he gave the Model Y an extra 15 miles of range. How generous of him! But, oh no, he screwed up. Looking further through the article we see:

Original version:

The 2020 Porsche Taycan 4S, an all-new electric luxury sport sedan, was way off from the EPA estimated 203 miles of range in Edmunds' real-world driving test. Edmunds observed 323 miles and saw a better energy consumption of 32.3 kilowatt-hours of electricity used every 100 miles of driving, versus the EPA's 49 kWh/100 miles.

In contrast, the 2020 Tesla Model Y Performance with 21-inch wheels — the brand's newest small SUV — did exceptionally well in the EPA's test, earning a range estimate of 291 miles and a power consumption rating of 28 kWh/100 miles using the maximum range mode. While Edmunds saw comparable efficiency in its real-world test, at 28.4 kWh/100 miles, the overall range result of 253 miles was slightly lower than the EPA estimate.

Altered version:

The 2020 Porsche Taycan 4S, an all-new electric luxury sport sedan, was way off from the EPA estimated 203 miles of range in Edmunds' real-world driving test. Edmunds observed 323 miles and saw a better energy consumption of 32.3 kilowatt-hours of electricity used every 100 miles of driving, versus the EPA's 49 kWh/100 miles.

In contrast, the 2020 Tesla Model Y Performance with 21-inch wheels — the brand's newest small SUV — did exceptionally well in the EPA's test, earning a range estimate of 291 miles and a power consumption rating of 28 kWh/100 miles using the maximum range mode. While Edmunds saw comparable efficiency in its real-world test, at 28.4 kWh/100 miles, the overall range result of 263 miles was lower than the EPA estimate.


So in one place in the article he gave the Model Y an extra 15 miles of range, but here he's only giving them an extra 10 miles. Woops! Interestingly, in the original article he even states that if he had charged the Model Y to 100% it probably would have given the Model Y an extra 25 miles of range (makes sense since that's about 10%). In the altered version he only gives them 10 or 15 miles depending on where you look, so he is clearly biased against Tesla and wants to give them as little range as possible in his new made up numbers.

So unless I'm missing something, he's altered his methodology for a past range test and made up new numbers go with it. This is the same guy running these new tests, where he could be accelerating and braking in different ways for the different test vehicles, or just be making up numbers entirely.

By the way February 4th, the day he altered that old article? That was the day before all that unusual put option activity on Friday February 5th. He then released his new article on Tuesday. Someone made a lot of money on those puts!

Worse than I thought. BAD Edmonds, Very BAD.

 

[mekberg]

Yeah.....this is definitely going red today. Can't even maintain buying volume for an hour

Oh well. I think we should expect to spend some time in the 700's at this rate. Might have to wait till Q1 P/D to really get a catalyst

Bro....MMD.

 

[MP3Mike]

That’s an intriguing idea. Do you know how feasible this is from a regulatory point of view? The technical side is pretty straightforward.

Here is an article with some details on when Overstock did something similar: Overstock Is Set to Finally Pay Out Its Digital Security Shareholder Dividend - CoinDesk

Note: Having multiple class of shares would likely get TSLA kicked out of the S&P500.

 

[gabeincal]

Can somebody explain why it would be a bad idea to sell 80 x Jan ‘23 100 puts for a premium of $42k?

 

[wtlloyd]

But people here believes it is better to have Tesla promise a lower price and not deliver for a year on a roof than to have a smaller queue with higher prices until production is fully ramped.. It's not like they had a master plan part one with a different model of business or anything. You know how Tesla customers all hate early adoption tax as if it's unexpected.

But I'm not the ceo of Tesla so not allowed to criticize the most negative margin product on their balance sheet.

Low prices discourage competition. Seems obvious to me.

 

[dl003]

I just sold a bunch of 3/19 $20s. You can buy those if you like.

so that was you crashing the price from 0.04 to 0.02...
geez, leave something for the rest of us.

 

[jbcarioca]

Interesting. During my days of doing a daily M25/M1 crawl, I would have happily paid $10k to be able to relax in traffic. For me, FSD is fun & interesting on the open road but it really earns it's keep in heavy, stop/start traffic which should make the UK a prime use case.

I spent nearly a decade commuting between Hyde Park Corner and Northampton. Today that would be quite easy in a Tesla with Tacc even easier with FSD. The M25/M1 was so painful I still remember it and I know it is worse today.

 

[phantasms]

Bro....MMD.

Exactly. I wonder if they'll finally break that 800 today. It'll trigger some stop-losses and then shoot right up to 845. I'm waiting to pounce.

 

[stealthyc]

Can somebody explain why it would be a bad idea to sell 80 x Jan ‘23 100 puts for a premium of $42k?

It reserves 800k of cash or margin for 2 years (which may or may not be considered a bad thing)

 

[StealthP3D]

But people here believes it is better to have Tesla promise a lower price and not deliver for a year on a roof than to have a smaller queue with higher prices until production is fully ramped.. It's not like they had a master plan part one with a different model of business or anything. You know how Tesla customers all hate early adoption tax as if it's unexpected.

But I'm not the ceo of Tesla so not allowed to criticize the most negative margin product on their balance sheet.

I just think it short-sighted and silly to criticize their business plan when they haven't even detailed it for us. You need to understand it before you criticize it. And, obviously, the people who developed the plan know a lot more about the specific factors that helped shaped the plan than you do.

It reminds me of the three blind men describing an elephant (all descriptions radically different depending upon where they were standing when they described it).

 

[dl003]

Can somebody explain why it would be a bad idea to sell 80 x Jan ‘23 100 puts for a premium of $42k?

I assume you have Portfolio Margin. If not, using $800k collateral to generate $42k over 2 years is kinda terrible.
If you have Portfolio Margin, think about what your position would look like in a black swan event, one that although won't get TSLA down to anywhere near 100, but still results in a nasty IV spike that can create a 400 or 500% paper loss and the impact on your margin. Worth the stress? I don't know. Personally I'd rather sell a single 980 put on that same expiry.

 

[mekberg]

Here is an article with some details on when Overstock did something similar: Overstock Is Set to Finally Pay Out Its Digital Security Shareholder Dividend - CoinDesk

Note: Having multiple class of shares would likely get TSLA kicked out of the S&P500.

What if Elon created an X holding company with blockchain only shares?