I'm scratching my head at your comment. What "action" are you talking about? This wasn't even a 4% drop today. If you want to run with the big dogs, you have to be comfortable peeing in the tall grass!
...
Responding to
@StealthP3D's comment to
@Vines
If the current price action is causing you to question your buy and hold strategy, that suggests to me that you really aren't comfortable or ready for buy and hold. You are instead a day or at least short term trader (in my lexicon, any trade that is influenced by this particular quarter's execution, numbers, results; that's short term). Any trade influenced by daily changes in share price - that's a short term trade.
For buy and hold, what you're looking for are changes in company strategy and/or prospects for the company strategy to succeed. These changes don't happen on a quarterly basis, nor are they influenced by details in the quarterly results. In Tesla's case specifically, a car that isn't delivered this quarter is a car delivered next quarter. Assuming no incentives, the revenue and profit are the same.
I'm personally a buy and hold investor. A few months back when the share price was under $200, I wrote then that I was as concerned about the $1xx share price as I would be by a $4xx share price. I didn't expect to see $4xx or $5xx (I didn't include it in my example), but in both cases they mean the same thing - nothing. I own exactly as many shares of the company now as I did then.
I grant that waking up to a $5xx share price is more fun than a $1xx share price, but nothing has happened in the last few months to change my investment thesis for the company - it continues to be a 10+ year horizon and a belief / expectation that at some point the company will be trading at $5xxx - an order of magnitude from here. Since I've read an investment thesis that prices out to $5x,xxx by 2030, all of the price action the last few months qualifies as noise. Even in the $5,xxx outcome, recent price action is just noise (where recent encompasses the trip down to $1xx, and the current trip to $5xx). If you're short term, such an idea is outlandish.
The big thing here, and we can use Tesla as our example - back in 2013, the shares had been trading in a range in the $20s and $30s. People were getting into the groove, short term trading the swings back and forth. Life was good for short term trading. And then there was a surprise profitable quarter and the share price disconnected from its trading history. It took 6 months(ish) and the shares had established a new trading range - $130-$180. In today's share price dollars, that'll be a move from the $300s to the $1300-1800 range.
Have we experience the same disconnect from the previous trading history? Maybe. Maybe not. I don't know. I know that I expect it to happen sooner or later and I don't want to be scavenging for pennies in front of the steamroller when it happens (besides - I don't have the time or energy to trade short term).
I do know that I personally suck at short term trading (any trading that depends on quarterly results, or shorter term), and I know that if I noticed that stuff, then I'd have sold out of that last run that turned into my first 10 bagger.
And if I noticed that stuff today, then I'm confident that I'd be selling out of my next 10 bagger just in time to avoid it.
I write all that, to maybe help you see what a buy and hold mentality looks like, and what you'll need to wrap your brain around. There are plenty of situations where buy and hold isn't the right approach - I don't know what's right for you, but if you think buy and hold is right for you, then I suggest strategy over deliveries for the focus of your research and study.
