Krugerrand
Meow
Bingo! Finally, somebody comes to my rescue. Buying spree begins.
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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
Bingo! Finally, somebody comes to my rescue. Buying spree begins.
Fact Checking
Well-Known Member
Thank you for your sacrifice!
Mike Smith
Active Member
This is a tiny problem for Tesla, and a massive problem for all of their competitors. Time will show this virus was a huge positive for Tesla.
ZachF
Active Member
has the buy signal been lit? Only down ~1% now.
Krugerrand
Meow
I’m going to take that post as a demand issue post as well. Keep ‘em coming.
Krugerrand
Meow
For me it has. Don’t be shy.
ZachF
Active Member
Well, Tesla is the only auto manufacturer where you don't have to venture out to potentially coronavirus-infested dealerships to make a purchase...
ZachF
Active Member
StealthP3D
Well-Known Member
Sometimes simple is better.
I don't put a lot of importance of being well-diversified but it depends upon your financial situation as well as the stock(s) involved. Buy and Hold is not incompatible with some amount of portfolio rebalancing but most people overdo it.
Every individual has a unique situation. At over 90% one stock, even I would rebalance some. But keep in mind your example started out with an initial position of 50% in TSLA at $30. When Tesla was at $30 I couldn't buy ANY of it (let alone 50% of my portfolio!) because it was too speculative. As a company establishes it's "Gorilla" status I become more comfortable holding a larger position but this will be different depending upon an individual's specific situation.
Let's look at the rather extreme scenario you laid out above. First off, I see it would be highly atypical for someone to put $100,000 of a $200,000 portfolio in stock as speculative as TSLA was in 2012 when it was a fledgling automotive company trading at $30. I'm sure someone did but this example is already an outlier at best. Ignoring that, observation tells me that most people (that bought around $30) sold most or all of it at $150 or less. So someone who held on to every share at $900 is going to have a HUGE amount of emotional leeway to be able to watch it drop from $900 to $600 (or even less) without even batting an eye compared to someone who sold most of it off at $90-$150 or less (and later re-bought for more).
A basic tenant of my style of buy and hold investing is that you don't sell just because it seems like you have done really well (because you will likely leave a lot of money on the table). This doesn't preclude selling some because your portfolio has become extremely concentrated in one position, it just says to use a good amount of restraint before doing so. To me, restraint means waiting to rebalance until after a stock is done reaching for the sky, not on the way up. For example, if I found with TSLA climbing through $500 I had an uncomfortable amount of TSLA in my account and wanted to rebalance, I would wait and watch for a couple of weeks rather than selling at $500 to "lock in my gains". Growth stocks, once they become a "darling" can go higher than you ever thought. You never hit the top this way but you might be surprised how it prevents you from leaving huge amounts of money on the table. But the key thing is NOT selling simply because it has had a good run.
I'm not going to speak for Karen but I believe she uses that strategy when she is taking on additional leverage through options. While that strategy can be used with a basic long position the tax implications for most people preclude it from being an advantage. Because one of the fundamental strengths of a Buy and Hold strategy is deferring taxes and letting your investments compound. I can testify, the benefit is eye-opening. When you trade regularly, all that goes out the window.
I don't believe you should ever invest a single dollar that you are not mentally prepared to lose. And I've never advocated (or used) margin. So your "rules" don't really make a lot of sense to me, especially at the end where you say, "Only after you have more than enough outside Tesla (or in future income) where you can safely sustain a black swan event, should you never sell a share.". Because, even in my 30's when I was investing discretionary income with gusto, I knew I could sustain a "black swan event". I've always been prepared to lose it all and don't recommend anyone enter the stock market without knowing everything could go to hell in a handbasket. Additionally, some day I will sell all of my TSLA (if I live long enough).
BTW, I just added more TSLA shares @ $645 as I was explaining this.
That they are no longer impartial.
CyberDutchie
Active Member
What the hell was that, hit 690 and two seconds later down to 660. Reeks of manipulation
I hope Krugerrand is OK!
Mike Smith
Active Member
I am finding this market activity incredibly suspect.
Sorry for delay.
It broke the run technicals.
TSLA - TESLA
I am not associated with that site in anyway. I just refer to it for technical indications at times.
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