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

[lklundin]

I understand the high level statements. I would like to hear objective responses such as what have been done to Model Y design to achieve higher efficiency than M3. Remember, MY and M3 are on the same platform. And MY is taller and bigger. If everything else all equal, MY should get lower efficiency.

It seems to follow that Tesla has made some efficiency improvements.

If so, then we should expect the launch of the Model Y to be accompanied by a new and more efficient Model 3.

 

[SageBrush]

Nah, I'm good. I'm not investing to make a 8% return, I have the index funds in my 401k to make sure I don't starve when I'm old. Personally I'm taking a gamble that will result in me retiring on time with a comfortable but sufficient nest egg, or retiring early with more money than I need.

I don't think you will find many here that don't know exactly what they are getting into. ​

Well said, although my personal experience is that as my net worth increased, my 'comfortable nest egg' amount became a moving target. It was not due to a change in living standard but two main things:

1. A desire to include my children in my security blanket
2. I incorporated the possibility of dips in my net worth of 30 - 50% from recessions or whatever.

The number I carried in my head for decades snowballed 4 fold. And the simple truth is that retirement brought a feeling of financial vulnerability.

 

[Rammstein]

I don’t understand how very little float makes it easy to manipulate the stock price. Wouldn’t it be a lot harder to manipulate it up rather than down since no one is selling?

 

[SageBrush]

Unless you think CNBC/Financial Media isn't playing you....

I think they are a mixture of idiots and bought puppets, the money equivalent of faux news. I admit though to being only peripherally aware of both since I have to take a long shower after exposure and I dislike wasting hot water.

 

[Fact Checking]

I don’t understand how very little float makes it easy to manipulate the stock price. Wouldn’t it be a lot harder to manipulate it up rather than down since no one is selling?

In the Nasdaq market, at any given price level, buyers and sellers are in rough equilibrium in the order book. If not then the price would near-instantly move.

A narrowing float (which I believe to be the case - maybe @ReflexFunds wants to chime in) would have two effects: cause price spikes due to fewer sellers, but also support of higher price levels would be weaker and easier to manipulate due to the shallower order book. Note that the short attack came on the day the price spiked to $960 on a day where the previous close was at $770, when the buying side of the book was probably particularly weak. Once the shorts managed to punch through a critical width of the order book the effect snowballed and was probably magnified by delta-hedging as well (which can increase volatility in both directions), plus weeks/months old trailing stops that were triggered, because the stock barely pulled back during the rally.

But unlike true bubbles that eventually run out in a frenzy, a narrowing float is a semi-permanent anti-dilutive condition with high volatility: the quick dip brings in all the buyers who were uncomfortable buying near ATH's (when you buy to hold long term you don't mind in principle, but it's mentally a lot more comfortable to buy 10-20% off ATHs "at a discount" - even for institutional investors. It's basic human nature to not be the bag-holder who bought near an ATH.

For example yesterday, despite the uptick rule (which normally reduces trading volume), 40 million shares were purchased, and a fair percentage were buy-and-hold I believe.

I.e. the true "effective float" of Tesla narrowed even more due to the Xetra stunt (possibly) run by Andrew Left and his co-conspirators: they shook out over-leveraged longs and low conviction longs, but they possibly also brought on board a few million shares worth more never-sell-below-$5,000 folks - which might have permanently raised the equilibrium fair price level.

If the effective TSLA float is not ~140 million shares but below 50 million shares, then we could see some interesting things going forward at these volume levels. If not then we'll consolidate somewhere.

 

[CorneliusXX]

I make a plea to those of you who, like me, are retail traders and not pros.
I am a very young retail trader from Italy, this is not financial advice, and you have no reason to believe me.

I know you are going to question my motives. I implore you to believe me that this is seriously done in good faith.
Feel free to dislike this x20, but please at least read my warning.

This forum is filled with tons of insight from tons of smart people from tons of different professions.

But being smart doesn't make you immune to greed. Isaac Newton lost a ton of money in the market. It's not because he was dumb. He was one of the smartest people alive on the planet.

If your Tesla position (or ANY position) in your portfolio is >20%, ESPECIALLY if it's massively up because of the recent run up, even more critically if it's an option position, ALL CAPS IF IT'S IN SHORT TERM OPTIONS, ALL CAPS ITALIC BOLD UNDERLINED IF IT'S SIGNIFICANT MONEY TO YOU:
please consider REDUCING IT to more prudent risk levels.

If 20% sounds like too small of an allocation to Tesla, and you're not just playing with dollars you can afford to lose: PLEASE, PLEASE, PLEASE. BOOK SOME GAINS.

I'm not asking you to sell your Tesla investment here. I'm not saying that this valuation is too high. I'm not saying higher risk cannot mean higher returns. I'm not saying Tesla is a bad company. I'm not saying ANY of those things.

I'm just asking for some risk management.

I've read about so many investment boards full of smart people analyzing companies. I've seen thousand-page threads about investment theses. They all made sense.

And then for whatever reason the shares take a big hit, and people are suddenly posting about their life savings having halved. People don't know how to tell their partner. People post about their children's college fund being gone.

Even if the price action is driven by short sellers. Actually, especially if the price action is driven by short sellers!

Please, consider the possibility that you will lose money due to market irrationality, manipulation, short selling, short gamma bloodbaths, huge market corrections having nothing to do with Tesla, your broker glitching out. Please be safe.

Sorry, I do realize this sounds extremely condescending. I don't think I'm smarter than you. I do think someone might read this at the right time and just maybe be more prudent, and it might matter.

Sorry,
MFran123

I tried to warn them about Issac Newton back in January and they didn't listen. Some people just don't know what is good for them.

You're correct, this probably is a bubble.

As a fan of history, it reminds me of a certain antipodean aquatic bubble from many a year ago. Did you know that perhaps the smartest person in history invested in this maladventure and lost a bunch of money. If that's not a reason to sell Tesla now, I don't know what is. I'm far more daft than perhaps the smartest person in history, so what chance do I have to understand stonks.

Other things in common with the aforementioned bubble and Tesla:

• The Queen has granted Elon a monopoly on trade with South America and the surrounding Islands
• Elon is trying to deal in the slave trade, or as it is colloquially known "autonomous vehicles"
• Tesla is definitely hunting whales

 

[jepicken]

Here's the historic IV of a very popular long-term LEAP contract

That's very useful info to put current IV's in context. Where do you get those historical IV charts?

 

[Fact Checking]

BTW., no Xetra shenanigans today, so far:

Less than 2,000 TSLA shares traded today on Xetra (!). Even the smaller Frankfurt exchange (FWB) had higher TL0 volumes.

Compare today's session with the intense market manipulation incident two days ago:

There were over 68,000 shares traded in that pre-market session (!). The usual Xetra TL0 volume is less than 5,000 shares, like today.

Note that insane spike down with a low of €701.30 and how whoever entered that short position on Xetra likely reversed the position after a "job well done" of price-manipulating the Nasdaq open down to a negative sentiment, which was at "10:00 (CET)" in the chart above.

I suspect the main goal of the short attack was not to establish an equities short position, but to make a leveraged short-term bet via $900 and $800 02/07 puts expiring today, a fair chunk of which were closed yesterday already - the rest might follow today and they'd be tiptoeing out to the exits soon. (Or not. )

 

[Fact Checking]

Tesla's Q1 international RO-RO shipments are in full swing, here's the ship positions from today:

The first European ship, Glovis Cosmos, should arrive in 1-2 days at Zeebrugge.

 

[AlexS]

Wonder if marketmakers will bring back up SP instead of hedging, to not pay out PUTs.

 

[Mike Smith]

Tesla's brand value ranked the fastest growing of any company in the world by Brand Finance - 65% increase in brand value over last year.

 

[Fact Checking]

Wonder if marketmakers will bring back up SP instead of hedging, to not pay out PUTs.

That would be my guess normally, except that open interest is all over the place this week:

Tesla, TSLA & the Investment World: the 2019-2020 Investors' Roundtable​

Open interest didn't change much yesterday in terms of distribution, but there was a lot more call buying and a fair amount of in the money put selling.

So I'd guess market makers, to the extent they have control over the price, would prefer for the price to settle down and consolidate: they are probably reasonably delta hedged already, and extra volatility increases their cost basis, because they have to delta hedge both on the way up and on the way down.

Options market maker total costs scale with the amount of cumulative delta hedging they have to perform for any particular options series. So while they don't mind volatility for far away options as it increases their income, on the day of big expiries I think they prefer price stability.

 

[Baumisch]

But Jeff! The technology is so far ahead of everybody else! You look at Porsche, and I'm not knocking Porsche, but the Taycan... I get every car magazine, and all the reviews are:

"Well... looks nice, but it doesn't have the range of a Tesla. If people can't go from here to grandma's house on one charge, or a quick charge, they're not gonna buy the car."

Tesla's technology somehow is better than Audi! And Porsche!
.

A German channel did a comparison M3 LR vs Tycoon Turbo - and the Taycan has similar range (-6%) tested at 90+ mph, which is normal cruising speed at Autobahn Germany. And also Charging Speed in Kilometers is faster if charged to 80%, but even to 50% on V2 Superchargers Taycan I faster. I am a Tesla Fanboy but Taycan seems to be legit, I compare Taycan to Model S and it's a shame, Model S is sooooo sloooow charging it's not even fair!

 

[Thekiwi]

New cell job listings: Search for Jobs | Tesla
Previous jobs talked about Pilot line. New ads talk about setting up cell manufacturing. Location : Fremont.

Excellent find! Can’t wait for battery day now, to see the massive leap in design efficiency that allows them to fit a cell production line into Fremont!

 

[ProfTournesol]

Excellent find! Can’t wait for battery day now, to see the massive leap in design efficiency that allows them to fit a cell production line into Fremont!

and new form factor ....

 

[JBRR]

Tesla, Inc. (TSLA) - Put-Call Ratio (Volume) (60-Day)

found this site to be a good tool for analyzing the options trading.

 

[JBRR]

DataGrapple - Blog #12464 - Looking increasingly IG - 2020 February 04

Tesla inc. (TSLA) 5y CDS rallied another -10bp today. The spread is 135bp mid on our London close. For reference, until last mid-October, this CDS had been trading roughly between 400bp and 850bp. That range was broken on the downside last October, when TSLA wowed the markets breaking lower than 350bp on Oct24, after it reported that was profitable in Q3. Auto gross margin ex-credits north 20% and positive CF generation have been welcomed by the bond market. Today it is closing tighter than the 5 widest names in CDX IG s33. Bloomberg put out a piece where they note that TSLA has more cash than ever, which could help credit rating agencies upgrade the name. Indeed, TSLA ended Q4 with a record $6.3B of cash, up nearly $1B from Q3. S&P currently rates Tesla B-, 6 steps below IG, with a positive outlook. It said in November it could upgrade the company if, among others, FCF is at least around break-even and cash at minimum $2.5B. Cash is more than double that and Q4 was the 3rd consecutive quarter of positive FCF. Moody’s has outlined similar upgrade criteria.

A credit rating upgrade cannot be far off.

 

[Right_Said_Fred]

A German channel did a comparison M3 LR vs Tycoon Turbo - and the Taycan has similar range (-6%) tested at 90+ mph, which is normal cruising speed at Autobahn Germany. And also Charging Speed in Kilometers is faster if charged to 80%, but even to 50% on V2 Superchargers Taycan I faster. I am a Tesla Fanboy but Taycan seems to be legit, I compare Taycan to Model S and it's a shame, Model S is sooooo sloooow charging it's not even fair!

Yep, my Model S is charging soooo slooowly that during road trips I can't even finish lunch before it's ready to continue. And that is after a drive that the Taycan will not even be able to complete without running out of electrons.

 

[Mike Smith]

Brand Finance values Tesla's brand at 12.4B. I think this is way too low.

 

[Fact Checking]

New cell job listings: Search for Jobs | Tesla
Previous jobs talked about Pilot line. New ads talk about setting up cell manufacturing. Location : Fremont.

This new position in particular, which opened two days ago:

https://www.tesla.com/careers/job/technical-programmanagercellengineering-59240

Technical Program Manager, Cell Engineering
Job Category: Manufacturing
Location: Fremont, California
Qualifications:

• 5-10 years working with development of manufacturing equipment preferably in powder mixing and conveyance.

Powder mixing is the first of many steps of li-ion cell production.

Also:

"You will drive the development and deployment of new manufacturing equipment and processes, as well as planning and execution of new cell manufacturing expansion within Europe. "​

GF4 cell production confirmed.