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

[jeewee3000]

I am actually worried about a VW/Porsche style short squeeze for Tesla.

Do you mean because this would mean the SP would spike insanely high, only to come back down again fast?

 

[Silentk]

What do people think about splitting the daily thread into two?

On a serious note maybe colour coding would work. So off topic posts in orange for example, and on topic posts in black.

It would be very easy to skip all the off-topic fun stuff and only read the important stuff.

Would save mods a huge amound of time filtering as well. Would ppl be prepared to put in the (minimal) extra effort?

Thoughts anyone?

 

[jeewee3000]

worth a mention: Musk already said on Twitter that he will be discussing long range production estimates during the earnings call (2023/24 etc) Something to be prepared for in terms of stock price reaction.

Tried to find this but couldn't. Anyone have a link to the tweet?

 

[SageBrush]

Papafox,
How do you reconcile the daily reports of selling tagged to shorts over 50% almost every day with Ihor's estimate that shares shorted have dropped from ~ 44m to 27m since the 2019 stock price low ?

Can both be true over time ?

 

[Carl Raymond]

This looks significant.

Blackrock to center investment strategy on climate change.

Twitter

 

[dutchneon]

Could it be that they are simply manipulating to amplify their day trading activities? Buy low in the morning and sell higher during the day, endulge (and encourage) the volatility, rinse and repeat?

I am also verry curious about the possibility the day traders / hedge funds just use the volatile vulnerability, to help push the stock high, so they help themselves create position, to help make the inevitable dip even bigger.... and short the hell out of it......

how realistic am i in thinking TSLA stock is this vulnerable to manipulations on this scale?
Cause i'm an enthousiast and read alot about Tesla but i never anticipated Tesla going over 400$ this fast and hard....

 

[bhtooefr]

Did you guys see this? I'd be pretty happy if true
Third Row Podcast on Twitter

Seems Y range is more than original 3.

Here's the actual Executive Order: https://ww3.arb.ca.gov/msprog/onroad/cert/pcldtmdv/2020/tesla_pc_a3740032_0_z_e.pdf

And the Model 3 EOs: https://ww3.arb.ca.gov/msprog/onroad/cert/pcldtmdv/2020/tesla_pc_a3740031r1_0_z_e.pdf (AWD) and https://ww3.arb.ca.gov/msprog/onroad/cert/pcldtmdv/2020/tesla_pc_a3740030_0_z_e.pdf (RWD)

To compare to the other trims, in descending order of range:

Model	2020 UDDS Range	2020 EPA Range
Model 3 LR RWD	495.1*	330
Model 3 Performance 18"	487.37	322 VL
Model 3 LR AWD	470.88	322
Model Y Performance	441.91
Model 3 Performance 20"	430.5	299
Model 3 Performance 19"	428.3*	304
Model 3 Mid Range	391.6*	264*
Model 3 Standard Range Plus	372.78	250
Model 3 Standard Range	329.35*	220*

*: Range copied from a superseded Executive Order (Performance 19") or previous model year, and likely not updated to reflect latest changes if there are any
VL: Voluntarily lowered

Also, if the Model Y is similar to the Performance 18"... that's almost exactly a 10% range hit. I'd expect 292 miles EPA range for the Model Y Performance if it's voluntarily lowered like the Model 3 is, higher if not - original estimate was 280, IIRC.

Just catching up on the thread. Regarding stock splits, if Tesla doesn't split, the big question will be, should I buy a car or shall I buy a share. At one point I remember this dilemma regarding an iPhone.

So, with more and more brokers offering fractional shares, I think this is less important.

Conversely, not splitting reduces the liquidity of options, as seen with BRK.A options being untradeable (because an option involving 100 shares of a $339k/share stock is ludicrously expensive)... and that reduces the amount of speculation (as opposed to investing) in the stock. This doesn't affect employee stock options, either, as those can be issued in units of less than 100 shares, all the way down to one share (although splitting before $100,000/share might not be a bad idea, to reduce the size of a single share options grant).

 

[Fact Checking]

Conversely, not splitting reduces the liquidity of options, as seen with BRK.A options being untradeable (because an option involving 100 shares of a $339k/share stock is ludicrously expensive)... and that reduces the amount of speculation (as opposed to investing) in the stock. This doesn't affect employee stock options, either, as those can be issued in units of less than 100 shares, all the way down to one share (although splitting before $100,000/share might not be a bad idea, to reduce the size of a single share options grant).

Wow, this is a very good argument against splitting the TSLA stock - an argument that someone should repeat to any Tesla Investor Relations person willing to listen.

 

[Fact Checking]

After an impressive day with a gap up plus intraday rise of +10%, closing +5% higher than the old all-time-high set just two trading days ago, with barely any pullback, I'd expect short-seller margin calls to come rolling in in volume, maybe set new all-time-highs as well in after-hours trading.

Almost half a million shares were traded in after-hours trading yesterday, which is very high by historical standards.

The first 2.5 hours of pre-market trading are showing similarly high volumes, 100k shares traded so far, and the volume and price action is indicative of margin call trades after a new all-time-high has been set:

Note that the price move from $537 to $534 was following a macro trend.

I'd expect both the pre-market and regular trading to be sensitive to macro trends. Futures are trending down currently, Nasdaq is projected to open about -0.2% lower at the moment.

 

[FrankSG]

Wow, this is a very good argument against splitting the TSLA stock - and argument that someone should repeat to any Tesla Investor Relations person willing to listen.

Do people buying a handful of options (even if you add them all up) really influence stock price all that much? A $5k or $10k SP isn't prohibitive to speculators who currently buy 100s or 1000s of option contracts, is it?

 

[dw4ngg]

Do people buying a handful of options (even if you add them all up) really influence stock price all that much? A $5k or $10k SP isn't prohibitive to speculators who currently buy 100s or 1000s of option contracts, is it?

Yes bc if you buy/sell 100s of contracts, you generally are sophisticated (or smart) enough to hedge.. edit: with share purchasing or selling activity ***

 

[Fact Checking]

Do people buying a handful of options (even if you add them all up) really influence stock price all that much? A $5k or $10k SP isn't prohibitive to speculators who currently buy 100s or 1000s of option contracts, is it?

Absolutely, see @ReflexFunds's analysis about the delta hedging side effect from a couple of days ago:

Reflex Research on Twitter

"$TSLA options update 1) At Tesla the huge options market (Calls on 71m shares, Puts on 148m) is a very powerful stock price feedback loop. Higher prices force option sellers to buy more shares to delta hedge & these purchases again drive the price higher."​

While in most stocks the options market follows the underlying, TSLA price action is very often defined by very large derivatives positions.

Basically TSLA options are extremely unpredictable and hard to price. Hence my impression is that most options market makers don't even try: they just delta hedge and mark up options premiums to finance the overhead.

Yes, like last Friday they will occasionally freeze price action into a narrow range to take a bite out of profit taking and options exercise, and to make rollover expensive to options holders - but other than that I don't think market makers have the market power to define the TSLA price - it goes wherever people trading options and the stock want it to go.

 

[printf42]

Well, technically it's newly printed shares, so it will impact all the EPS calculations, etc. - i.e. it's technically dilutive, so TSLAQ have been using this half-truth to create an imaginary $554 price barrier for short-term price rises.

The first tranche is 1.69 million shares, so the dilutive effect is also minimal (0.9%) - and obviously dealing with a sustained $554 (and higher) price levels is a happy problem to Tesla investors.

“Toss a coin to ur Witcher”, Elon deserves it.

 

[dl003]

Macro trending down slightly but will get worse at the opening bell as shorts liquidate their entire portfolio to cover Tesla.

 

[KarenRei]

“Toss a coin to ur Witcher”, Elon deserves it.

So long as Elon keeps his ratio of personal-luxury-spending to investment-in-a-better-future-spending down, I consider being diluted by CEO awards to Elon to be a form of charitable contribution to building a better world.

In regards to that, I do think he's gone a bit overboard in terms of buying out the neighbors in his neighborhood. Last I saw his LA real estate was estimated at $70M, and he has smaller amounts of real estate elsewhere. But he's far from "private islands", "superyachts", "floating sky palaces" territory. He also has a $70M Gulfstream G650ER, which sometimes he practically lives out of, but 90+% of his travel is business travel, and pretty much nobody who supports Musk's work wants to see him wasting time traveling coach. He could get by on a cheaper jet, with only occasionally needing more stopovers, but... meh.

While I don't think that anybody should be in a situation to be spending many tens / lower hundreds of millions of dollars in personal luxury (while simultaneously recognizing that people who are good at using billions of dollars of capital to create new wealth or running cost-effective charitable activities should be encouraged to do so - that the act of "having wealth" isn't itself the problem, it's the usage).... compared to his peers, Elon's personal luxury spending appears to be relatively modest. I mean, just one of Gates's many mansions and ranches alone is worth more ($123M) than all of Musk's real-estate combined - and Gates is generally thought of as a "philanthropic billionaire"

 

[FrankSG]

Absolutely, see @ReflexFunds's analysis about the delta hedging side effect from a couple of days ago:

Reflex Research on Twitter

"$TSLA options update 1) At Tesla the huge options market (Calls on 71m shares, Puts on 148m) is a very powerful stock price feedback loop. Higher prices force option sellers to buy more shares to delta hedge & these purchases again drive the price higher."​

While in most stocks the options market follows the underlying, TSLA price action is very often defined by very large derivatives positions.

Basically TSLA options are extremely unpredictable and hard to price. Hence my impression is that most options market makers don't even try: they just delta hedge and mark up options premiums to finance the overhead.

Yes, like last Friday they will occasionally freeze price action into a narrow range to take a bite out of profit taking and options exercise, and to make rollover expensive to options holders - but other than that I don't think market makers have the market power to define the TSLA price - it goes wherever people trading options and the stock want it to go.

I think you guys misunderstood what I asked. I understand options influence the share price, but I'm skeptical that those calls on 71m shares and puts on 148m shares are predominantly retail investors buying a handful of contracts at a time. Isn't the vast majority of this most likely held by big guys that buy 100s and 1000s of contracts, who would be unaffected by rising option premiums as a result of a rising SP?

 

[AlexS]

someone is covering premarket? printing 540+

 

[dl003]

So long as Elon keeps his ratio of personal luxury spending to investment-in-a-better-future spending down, I consider being diluted by CEO awards to Elon to be a form of charitable contribution to building a better world.

In regards to that, I do think he's gone a bit overboard in terms of buying out the neighbors in his neighborhood. Last I saw his LA real estate was estimated at $70M, and he has smaller amounts of real estate elsewhere. But he's far from "private islands", "superyachts", "floating sky palaces" territory. He also has a $70M Gulfstream G650ER, which sometimes he practically lives out of, but 90+% of his travel is business travel, and pretty much nobody who supports Musk's work wants to see him wasting time traveling coach. He could get by on a cheaper jet, with only occasionally needing more stopovers, but... meh.

Once he runs out of space for unsold model 3 he'll be looking at islands for sure.

 

[mongo]

So long as Elon keeps his ratio of personal luxury spending to investment-in-a-better-future spending down, I consider being diluted by CEO awards to Elon to be a form of charitable contribution to building a better world.

In regards to that, I do think he's gone a bit overboard in terms of buying out the neighbors in his neighborhood. Last I saw his LA real estate was estimated at $70M, and he has smaller amounts of real estate elsewhere. But he's far from "private islands", "superyachts", "floating sky palaces" territory. He also has a $70M Gulfstream G650ER, which sometimes he practically lives out of, but 90+% of his travel is business travel, and pretty much nobody who supports Musk's work wants to see him wasting time traveling coach. He could get by on a cheaper jet, with only occasionally needing more stopovers, but... meh.

Directed at the line of thought, not yourself:

Elon does not sells shares of Tesla, Elon does not take a salary. All his spending money is based on loans against his stock. Real estate is a way for him to continue paying the bills on his plane and other things. Take out loan, buy appreciating asset, take out new loan against asset.

I paid most of my Tesla-related expenses too. Tesla last year was actually net negative comp for me.

Twitter

Dude flew out to Flint and back to CA with something like 10 hours on the ground and a big group of people just to inspire kids. I say he can have whatever plane he wants.

 

[Mkorpal]

Anyone get the feeling today might actually top yesterday?