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

[UCF3]

I don't really understand the 5:1. If you're going to do it, why not 10:1?

They didn’t want to get close to Gordon Johnson’s price target

 

[Zero CO2]

this should help with liquidity for S&P inclusion

 

[Mike Smith]

Companies tend to do splits when they expect the stock to go higher in the near future. SP moves in either direction are exacerbated somewhat with an increased share count. Tesla sees good news on the horizon.

 

[printf42]

Splits help retails investors (who do not do fractions)
Split helps S&P accumulate incognito
Playing options just got 5 times costlier

Congrats All!!

Split also makes it more costly for high frequency trading, since they pay fees per share, hence we can expect less manipulation.

 

[JusRelax]

Playing options just got 5 times costlier

I wish that that meant that my options are now worth 5x as much LOL.

 

[mickle]

AWESOME!!! (IMHO)
Each stockholder of record on August 21, 2020 will receive a dividend of four additional shares of common stock for each then-held share, to be distributed after close of trading on August 28, 2020. Trading will begin on a stock split-adjusted basis on August 31, 2020.
"

So what goes on between Aug 21-28? It sounds like shares trade at current prices but you don't get the extra 4?

 

[elasalle]

Does Split (# of shares outstanding) make TSLA eligible for DOW as well now? Do we have two suitors now

 

[Mich]

did LEAPS just got burned?

 

[dl003]

@#*$(*#**(*(!@**)( my heart almost stopped. Some small/mid cap companies got added but not TSLA
S&P 500® - S&P Dow Jones Indices

 

[Unpilot]

Say a person had a 10/16 $3500 call....what happens there?

 

[Driver Dave]

420 here we come!

 

[Mike Smith]

Splits help retails investors (who do not do fractions) ...widens the base
Split helps S&P accumulate incognito
Playing options just got 5 times costlier

Congrats All!!

This doesn't do anything to help S&P funds accumulate - it actually makes it somewhat more difficult since the price will now be slightly more volatile. And options just got 5 times cheaper, not costlier.

 

[phantasms]

YEAH BABY!!!!!!

 

[Runarbt]

So what goes on between Aug 21-28? It sounds like shares trade at current prices but you don't get the extra 4?

not current price, it will trade 1/5th

 

[JusRelax]

Does Split (# of shares outstanding) make TSLA eligible for DOW as well now? Do we have two suitors now

Seems possible, but IMO not likely. The most expensive stocks I see on the DOW currently are Boeing at 345.02 and United Health at 303.98

 

[Cherry Wine]

Say a person had a 10/16 $3500 call....what happens there?

You now have 5 $700 calls. Congrats!

 

[woodisgood]

Say a person had a 10/16 $3500 call....what happens there?

I believe said person ends up with 5 10/16 $700 calls but I’m honestly not sure. Haven’t been through this.

 

[Ameliorate]

This doesn't do anything to help S&P funds accumulate - it actually makes it somewhat more difficult since the price will now be slightly more volatile. And options just got 5 times cheaper, not costlier.

Are you familiar with this language? I was not expecting the "dividend" part. In a traditional split option holders would receive 5x as many options, they would all be valued at 1/5 of current, to be net neutral. Is this a traditional split?

 

[JusRelax]

This doesn't do anything to help S&P funds accumulate - it actually makes it somewhat more difficult since the price will now be slightly more volatile. And options just got 5 times cheaper, not costlier.

I think what @elasalle meant is that the fees to transact on TSLA options just got 5x more expensive.

 

[Nuclear Fusion]

Split helps S&P accumulate incognito

Yeah that sucks
Unless the fund has ultra strict rules to only buy when listed
This is totally intentional from Tesla due to pending S&P listing