Gigapress
Trying to be less wrong
From open on April 26th to open on April 27th, TSLA dropped 9.73% while the S&P 500 dropped 2.14%, a 3x difference, which is well within the range of typical variation TSLA exhibits around its beta for individual days. Today I tried doing the analysis again but using the S&P 500 instead of the NASDAQ Composite, and I got the same general results but slightly stronger.
The first scatter plot below depicts the daily TSLA change relative to the daily S&P 500 change for all trading days since Jan 2020. There is a weak correlation with R^2 of 0.269 and a beta of 2.
If we look at the second plot, which zooms in on the 17 days where the S&P 500 dropped between 2 and 2.5% like it did on April 26th 2022, the change for TSLA was usually anywhere from +0.5% to -10%. Just looking at the chart, I can't even find the April 26th data point easily...because it's not an outlier. Now let's do the math. The average drop for TSLA on those days was 6.7%, with a population standard deviation estimate of 5.4%.
(9.7% - 6.7%)/5.4% = 0.56 sigma deviation from the mean
This is not statistically significant, and therefore there is no basis for concluding that Elon's stock sale on April 26th had any substantial impact on the stock price, unless we believe Elon's sale had a substantial influence on the entire S&P 500 that day. To the extent that Elon's sale did drag down the TSLA price on April 26th, the effect was most likely smaller than the effect of the S&P 500 drop.
Also, to clarify, my statement was not absolute: "the timing of the biggest drops in TSLA's price have coincided almost exactly with the broader market collapse days and not so much with major dates in the stock selling and Twitter acquisition saga". This generic statement is true while leaving room for outliers, although after reviewing the historical record in more detail I should add that big TSLA drops also tends to occur during times of extreme volatility.
Out of 667 total trading days since Jan 2020, there have been 20 days (3%) in which Tesla fell at least 9%, and the April 26th 2022 drop was only one of the 20 data points. TSLA has had 49 total days since Jan 2020 in which it moved at least 9% from one open to the next.
The table behind the spoiler lists those instances with the context of the S&P 500 and events that were probably significant in moving the stock price up or down.
| Date | TSLA Open | S&P 500 Open | S&P 500 % Change | TSLA % Change | Same direction? | Notable Event |
| 05/27/22 | 723.25 | 4077.25 | 2.33% | 9.35% | TRUE | Broad stock market rally and bigger Tesla rally after Musk filed 13-D amendment changing his Twitter bid |
| 05/13/22 | 773.48 | 3963.9 | 1.54% | 10.34% | TRUE | Twitter fires two top executives, freezes hiring and announces non-labor cost-cutting |
| 05/12/22 | 701 | 3903.95 | -2.16% | -11.82% | TRUE | Ukrainian war of independence and sanctions causing severe economic challenges and stock market crash SEC initiates investigation of Musk for delay In disclosing 5% Twitter stake |
| 04/27/22 | 898.58 | 4186.52 | -2.14% | -9.73% | TRUE | Ukrainian war of independence and sanctions causing severe economic challenges and stock market crash including massive TSLA bear run; Elon announced intent to acquire Twitter two weeks earlier but stock held steady for 11 days |
| 02/25/22 | 809.23 | 4298.38 | 3.43% | 15.54% | TRUE | Invasion of Ukraine causing volatility |
| 02/24/22 | 700.39 | 4155.77 | -3.91% | -15.66% | TRUE | Invasion of Ukraine causing volatility |
| 01/28/22 | 831.56 | 4336.19 | -1.01% | -10.91% | TRUE | Tesla quarterly report Stock market meltdown |
| 01/24/22 | 904.76 | 4356.32 | -2.57% | -9.19% | TRUE | Stock market meltdown |
| 11/11/21 | 1102.77 | 4659.39 | -0.23% | 9.14% | FALSE | Elon selling bunch of stock causing volatility |
| 11/10/21 | 1010.41 | 4670.26 | -0.79% | -13.91% | TRUE | Elon selling bunch of stock causing volatility |
| 05/11/21 | 599.24 | 4150.34 | -1.84% | -9.88% | TRUE | Elon on Saturday Night Live over the weekend |
| 03/10/21 | 700.3 | 3891.99 | 1.04% | 15.15% | TRUE | Not really clear why this might've happened, but there was a strong Tesla China sales report from CPCA and a Big Tech rally |
| 02/23/21 | 662.13 | 3857.07 | -0.73% | -13.18% | TRUE | Major one-day drop in NASDAQ and Bitcoin, which Tesla had recently announced stake in |
| 01/08/21 | 856 | 3815.05 | 1.34% | 10.08% | TRUE | Continued TSLA explosive bull run Gamestop-driven meme stock mania |
| 12/10/20 | 574.37 | 3659.13 | -1.26% | -12.13% | TRUE | Tesla $5B capital raise via equity offering on 12/9; Elon announced move to Texas on 12/8 |
| 11/19/20 | 492 | 3559.41 | -1.46% | 9.74% | FALSE | Continued TSLA explosive bull run |
| 11/17/20 | 460.17 | 3610.31 | 0.28% | 12.53% | TRUE | S&P 500 announcement for TSLA inclusion |
| 09/24/20 | 363.8 | 3226.14 | -2.83% | -10.21% | TRUE | Wild TSLA volatility immediately following 5-for-1 stock split on Aug 31st; widespread market selloff first three weeks of September (index down 10%) |
| 09/15/20 | 436.56 | 3407.73 | 1.31% | 14.60% | TRUE | Wild TSLA volatility immediately following 5-for-1 stock split on Aug 31st; widespread market selloff first three weeks of September (index down 10%) |
| 09/08/20 | 356 | 3371.88 | -2.37% | -11.62% | TRUE | Wild TSLA volatility immediately following 5-for-1 stock split on Aug 31st; widespread market selloff first three weeks of September (index down 10%) |
| 09/03/20 | 407.23 | 3564.74 | 0.59% | -14.98% | FALSE | Wild TSLA volatility immediately following 5-for-1 stock split on Aug 31st; widespread market selloff first three weeks of September (index down 10%) |
| 09/01/20 | 502.14 | 3507.44 | -0.07% | 12.94% | FALSE | Wild TSLA volatility immediately following 5-for-1 stock split on Aug 31st |
| 08/21/20 | 408.952 | 3386.01 | 0.76% | 9.89% | TRUE | Continued TSLA explosive bull run |
| 08/18/20 | 379.798 | 3387.04 | 0.18% | 13.24% | TRUE | Continued TSLA explosive bull run |
| 08/13/20 | 322.2 | 3372.95 | 0.52% | 9.59% | TRUE | 5-for-1 stock split announced 2 days prior |
| 07/24/20 | 283.202 | 3218.58 | -1.62% | -15.66% | TRUE | Earnings call 2 days earlier; Giga Texas announced; Biggest day for Q2 2020 corporate earnings reports in general; TSLA coming off furious highly-volatile bull rally |
| 07/13/20 | 331.8 | 3205.08 | 1.67% | 18.84% | TRUE | Continued TSLA explosive bull run |
| 07/07/20 | 281.002 | 3166.44 | 0.35% | 10.05% | TRUE | Continued TSLA explosive bull run |
| 07/02/20 | 244.296 | 3143.64 | 1.21% | 12.79% | TRUE | Huge beat of consensus expectations for Q2 2020 production and deliveries |
| 06/16/20 | 202.37 | 3131 | 4.58% | 10.25% | TRUE | CPCA reports Tesla China sales in May jumped to new record up 150% MoM from April, shooting Model 3 plug-in market share to 17% at over 11K sold, 3.6x more than the nearest competing vehicle Tesla WeChat account polls Chinese people for suggested designs for a "China-style" EV |
| 05/05/20 | 157.958 | 2868.88 | 1.91% | 12.67% | TRUE | High volatility time for TSLA in general following epic recovery from COVID panic (average daily move 6%) |
| 05/01/20 | 151 | 2869.09 | -2.11% | -11.72% | TRUE | Elon swearing on earnings call, saying California COVID protocols were "fascist" and government needs to "give people back their goddamn freedom", Elon tweeting controversial COVID opinions; High volatility time for TSLA in general (average daily move 6%) following epic stock market recovery from COVID Panic and spectacular growth of options trading on TSLA while people stayed at home and played on Robinhood |
| 04/14/20 | 139.794 | 2805.1 | 0.81% | 18.44% | TRUE | COVID Panic Bounceback |
| 03/25/20 | 109.05 | 2457.77 | 4.83% | 14.24% | TRUE | COVID Panic Bounceback |
| 03/24/20 | 95.46 | 2344.44 | 2.35% | 10.08% | TRUE | COVID Panic Bounceback |
| 03/20/20 | 87.64 | 2431.94 | 1.61% | 16.95% | TRUE | COVID Panic Bounceback |
| 03/18/20 | 77.8 | 2436.5 | 0.45% | -11.59% | FALSE | COVID Panic |
| 03/16/20 | 93.8999 | 2508.59 | -2.39% | -21.09% | TRUE | COVID Panic ("Black Monday II") |
| 03/12/20 | 116.178 | 2630.86 | -6.89% | -9.26% | TRUE | COVID Panic ( "Black Thursday") |
| 03/09/20 | 121.078 | 2863.89 | -3.06% | -12.26% | TRUE | COVID Panic ( "Black Monday") |
| 03/03/20 | 161 | 3096.46 | 4.11% | 13.18% | TRUE | Wild market volatility continued as world pondered alarming COVID trends |
| 03/02/20 | 142.252 | 2974.28 | 1.97% | 12.95% | TRUE | Wild market volatility continued as world pondered alarming COVID trends |
| 02/28/20 | 125.94 | 2916.9 | -4.76% | -13.74% | TRUE | TSLA bear run had started a week earlier probably due to bubble fears and rapidly growing concern about the exponential spread of COVID globally |
| 02/19/20 | 184.7 | 3380.39 | 0.34% | 9.73% | TRUE | Continued TSLA explosive bull run |
| 02/10/20 | 160 | 3318.28 | -0.52% | 9.51% | FALSE | Continued TSLA explosive bull run |
| 02/06/20 | 139.984 | 3344.92 | 0.60% | -14.98% | FALSE | Continued TSLA explosive bull run (volatility from just two days after a 31% single-day increase) |
| 02/04/20 | 176.592 | 3280.61 | 1.39% | 31.06% | TRUE | Continued TSLA explosive bull run |
| 01/30/20 | 126.484 | 3256.45 | -1.00% | 9.85% | FALSE | Continued TSLA explosive bull run |
| 01/14/20 | 108.851 | 3285.35 | 0.43% | 10.28% | TRUE | Explosive TSLA run following bombshell Q3 and Q4 2019 numbers plus Shanghai ramping production successfully which demonstrated Tesla could go from breaking ground on construction to producing cars in just 1 year; |
The table shows that typically, big moves for TSLA are triggered either by big swings in the general stock market, or by significant Tesla news to which the market reacts strongly, sparking a runaway bull rally. I think there is very little that could've been different in the first half of 2022 that would've overcome the tsunami of hurt TSLA experienced due to the stock market crash and Shanghai shutdowns. In rare instances it does look like Elon's actions temporarily influenced the stock with his antics and stock sales, but the stock recovered within a week or two every time.
Let's expand wider in order to obtain a bigger sample size. In this time, there have been 83 extreme days in which TSLA opened at least 7% lower or higher than its previous open. On those days, the S&P 500:
- Moved the same direction as TSLA on 71 out of the 83 days (86%)
- Moved at least 1% in the same direction on 47 of the days (57%)
- Moved at least 2% in the same direction on 22 of the days (27%)
- Moved at least 3% in the same direction on 11 of the days (13%)
- Fell on 29 out of the 34 days (85%)
- Fell at least 1% on 23 of the days (67%)
- Fell at least 2% on 15 of the days (44%)
- Fell at least 3% on 6 of the days (18%)
- Moved the same direction as the S&P 500 on 33 out of the 35 days (94%)
- Moved at least 3% in the same direction on 27 of the days (77%)
- Moved at least 6% in the same direction on 17 of the days (49%)
- Moved at least 9% in the same direction on 10 of the days (29%)
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