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

[M3Rider]

Now Tesla should sue that specific short seller.

Wondering about owners of those bots that sold aftermarket on Fri. Are they happy with the guy?
Prob. the only victims of his efforts.

 

[lklundin]

or me. <==Thank you. Edited to add your name.



Karen has forwarded your post to the forum. Keith should respond within some delay. Also, I’m confused. I got wn automatic response from the site, as a confirm your email type thing, or are you trying to become a mod? That usually takes a longer response.

I am only an infrequent supercharger user and don't have plans to contribute frequently.
I just happened to notice that the Herzsprung, DE Supercharger has (had?) construction work ongoing, quite obviously to double its charging stalls from 6 to 12. Maybe attaching a photo to my post as documentation somehow overwhelmed the site. I actually wanted to attach more than one photo, since there was a good view of the ongoing electrical work. But I understand that the site is run by volunteers giving their own time.

 

[Fact Checking]

I think you're underestimating the potential for manipulation in after-hours trading, regardless of volume. If you think TSLA should have opened at $504.10 based on the after-hours trading, then the manipulators are doing a great job. It's obvious why they'd want the recent drop to continue, given the appearance of a recent parabolic top. Again, this drop was quickly rejected in Germany based on no new news.

Everyone who ignores high volume after-hours or early-trading price changes is a fool. TSLA genuinely dropped to $504 on Friday, as some news reports (also initial inquiry by @tinm) suggested that there's an active NHTSA investigation, which turned out to be false: there's an investigation of whether to investigate.

 

[Mike Smith]

Everyone who ignores high volume after-hours or early-trading price changes is a fool. TSLA genuinely dropped to $504 on Friday, as some news reports (also initial inquiry by @tinm) suggested that there's an active NHTSA investigation, which turned out to be false: there's an investigation of whether to investigate.

I think you're making my point for me. It's a disservice to claim there's been some great rally in Germany when really it just unwound a drop based on false information that didn't even happen in regular trading. It's a binary decision whether to use the after-hours close or market close, and it's clearly more informative to use the market close. The only exception might be after an earnings report or other major news when a few million shares trade after-hours. This doesn't mean I think after-hours trading should be ignored completely.

 

[fdutra1]

For OTM call contracts expiring on Jan. 31st, how are the premiums expected to evolve as the ER on Jan. 29 approaches?

In principle, the decreasing number of days left before expiry should leave such contracts with less probability to end up ITM, causing a downwards pressure on the premium.

How will the markets expectation to the ER affect this basic pricing mechanism?

Volatility? I'm no expert but have seen the premium price of OTM/ITM options skyrocket on a Friday well beyond any sane expectations of TSLA's current ability to reach beyond the strike. Getting old, so maybe my memory is failing,,,

 

[lklundin]

As someone holding some jan 31 600calls, premiums shouldve spiked upon confirmation of the ER being within their expiration. Should stay around whatever we see on tuesday up until the ER itself. (note value of the calls will move with the SP) premiums may drop after ER but the SP could move another 18%. (maybe??)
Yes every day we trade flat the cost of Jan 31s will go down. If we trade up theyll remain the same or increase in price.

If the stock doesnt move on the 29th yes youll be able to buy options a lot cheaper. If it shoots up, sure the IV may drop but option cost could still be 20-2000% more expensive depending on what youre looking at.
In my opinion if you expect the stock to be over 530 after the ER I suspect youd be better buying now than when its 530-650.
Decisions youll have to make for yourself. I got lower cost at the risk of Not being included in the ER which almost would have assured these 600s go to 0 so that was and still is a bit of a gamble. Now that its more likely to expire ITM the price goes up!
One could pinpoint targets you need post ER better if we knew what calls you had in mind. How bullish are you?

Thank you so much for improving my vague understanding of options trading.

Based on the excellent contributions from many here, I actually decided to go ahead and buy my single Jan 31 600$ call contract a few hours before the close last Friday. So I was very pleased to see the ER announcement that followed. This was only my 7th purchase of a call contract, with just over 3% of my portfolio being calls, so I am still learning and still keeping the risk level at a reasonable level.

In addition to learning the math behind the options trading, I am also trying to make sure that I will not develop some kind of gambling affliction from these trades, since the risk level is so much higher - and that I will be able to remain rational while placing these trades. So I will be interested to see how I react if my call expires worthlessly, and how that might affect my view on my continued Tesla trading.

Thanks again.

 

[sparcs]

here's the shortseller's response via CNBC after Tesla made their statement:

Sparks told CNBC on Monday, after Tesla issued its denial: “I am encouraged by Tesla’s commitment to continue cooperating with NHTSA, and I expect we will learn shortly why Tesla owners report unintended acceleration much more frequently than owners of other vehicles.”

 

[MP3Mike]

That's a price display artifact, with some effect on inexperienced or lazy investors, to the great delight of after hours and pre-market arbitrageurs.

But what we should be interested here on the TMC investor forum is the "real" current price of TSLA and changes to it, not display artifacts.

No it isn't a "price display artifact". Reporting a % change number is meaningless unless everyone agrees on what that percentage applies to. The agreed upon standard is that the % change number always relates to that last NASDAQ close price for the stock.

Never did I say that you should ignore the AH activity, but it is just considered part of the next official trading session.

 

[SageBrush]

In addition to learning the math behind the options trading, I am also trying to make sure that I will not develop some kind of gambling affliction from these trades, since the risk level is so much higher - and that I will be able to remain rational while placing these trades. So I will be interested to see how I react if my call expires worthlessly, and how that might affect my view on mu continued Tesla trading.

I feel exactly this way.

Besides being a very new newb to the world of options my gut feeling is that it comes way too close to gambling in so many instances. I think I am still going to venture into options when I estimate high volatility in order to take advantage of a tax advantage I 'enjoy' but otherwise I'll watch the game from the sidelines.

 

[Lessmog]

here's the shortseller's response via CNBC after Tesla made their statement:

Sparks told CNBC on Monday, after Tesla issued its denial: “I am encouraged by Tesla’s commitment to continue cooperating with NHTSA, and I expect we will learn shortly why Tesla owners report unintended acceleration much more frequently than owners of other vehicles.”

Well, for me, I am mostly excited by Plant-A-Seed-Day.

 

[printf42]

here's the shortseller's response via CNBC after Tesla made their statement:

Sparks: “...why Tesla owners report unintended acceleration much more frequently than owners of other vehicles.”

Maybe, because most of the reports are “on behalf of a owner”. aka, not reported by a owner?
Just guessing here.

 

[ggr]

Agree with premiums going up prior to earnings. For me, the uncertainty is what happens to them the day after earnings are reported. I've seen them go either way without any regard to the actual value of the earnings, and for me there lies the rub.

The time value premium depends on the volatility of the stock, and that will always decrease after the earnings report. Any individual option may go up or down depending on the stock movement, but the premium should reduce.

 

[Mike Smith]

here's the shortseller's response via CNBC after Tesla made their statement:

Tesla didn't 'blast' the customer complaints as claimed in CNBC's title, they 'blasted' the petition. CNBC has very little regard for the truth and takes every opportunity to make Tesla look bad.

 

[SageBrush]

The time value premium depends on the volatility of the stock, and that will always decrease after the earnings report. Any individual option may go up or down depending on the stock movement, but the premium should reduce.

(my bolding)
Did you mean the time value will drop ?

 

[SageBrush]

Tesla didn't 'blast' the customer complaints as claimed in CNBC's title, they 'blasted' the petition. CNBC has very little regard for the truth and takes every opportunity to make Tesla look bad.

The petitioner is playing the 'concerned citizen,' but I think he is just a stock manipulator and I hope he pays dearly for it.

 

[ggr]

(my bolding)
Did you mean the time value will drop ?

Yes. Is there some other premium being discussed?

 

[ByeByeJohnny]

Yes, that's accurate but misleading: once we clean out the multi-exchange artifacts TSLA appreciated +2.3% today, from $504 to $515.5, see my other comment.

But with that reasoning if Tesla tomorrow closes at 512 you should then say that it was down 3 (if the europrice today was 515, not sure of exchange) instead of up 2 (compared to closing at 510) or even up 8 from 504 where Nasdaq after hours closed. All because of 1284 stocks traded in Frankfurt. When an average day now is 20 million?

I've never seen afterhours and premarkets included in any week, month or other graphs either

 

[dw4ngg]

here's the shortseller's response via CNBC after Tesla made their statement:

Sparks told CNBC on Monday, after Tesla issued its denial: “I am encouraged by Tesla’s commitment to continue cooperating with NHTSA, and I expect we will learn shortly why Tesla owners report unintended acceleration much more frequently than owners of other vehicles.”

OBJECTION - leading statement by the short guy over there.

 

[fdutra1]

The time value premium depends on the volatility of the stock, and that will always decrease after the earnings report. Any individual option may go up or down depending on the stock movement, but the premium should reduce.

So if I'm reading you right, the Total premium that I purchase and sell a call option for is actually a combination of the "time value premium" (extrinsic value =volatility) and the underlying price (intrinsic value), and that the volatility will decrease after earnings, but the Total premium may increase/decrease as a function of the underlying stock price changing. This is really important to me as I have several 1/31 calls at various strikes, so if I expect the price of TSLA to increase exponentially with a grand earnings report, and I anticipate that it will reach or top some of my various strike prices, I may want to hold on to those. On the other hand, I may wish to part with those that are quite a ways OTM just prior to the ER. A lot will depend on the stock price and market sentiment/news just prior to earnings I guess. Thanks!, I think my rub has been scratched a bit.

 

[MC3OZ]

I feel exactly this way.

Besides being a very new newb to the world of options my gut feeling is that it comes way too close to gambling in so many instances. I think I am still going to venture into options when I estimate high volatility in order to take advantage of a tax advantage I 'enjoy' but otherwise I'll watch the game from the sidelines.

With options trading close to expiry there is an additional risk of manipulative stories being posted in the media, with corresponding bear raids.

It is a pattern we have seen many times, it is harder to sustain manipulation and misleading reporting over a longer time frame, but it has a short term effect most times, because the short selling seems to be in sync with the reporting...

The experienced traders know this will happen and I guess they have strategies to deal with it, but a newb needs to be aware of this risk and plan to deal with it... The media, short sellers and the SEC are not going to change the way they play the game, Tesla can't do much about it...