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

[Off Shore]

"If you bombard Earth with photons for long enough it will emit a Tesla" is exactly what I needed to hear today.

 

[Highway2Heel]

Jokes aside, that interview basically said ARK is sticking with their January assessment. That’s interesting because TSLA is on track to significantly exceed it, amazing as that sounds.

I believe $6800ish was a base case. The bull case was $15,000 by 2024. This is why I won’t sell anytime soon.

 

[Bet TSLA]

Just found out on a finance forum a woman who’s husband had some really bad streak with options. -1.4M. Do you think TSLAQ made another victim and will create another divorce?

The answer is easy, but she obviously doesn't understand. Who cares? Making the kind of money she makes the loss is pretty much irrelevant in the long term. Happens all the time.

All she's saying is that he's investing in a manner that's too risky for her. If she didn't want that to happen, she needed to make it clear up front. The real test for this sort of thing is whether she would be complaining like this if he was up $1.4M instead of down. I have my doubts.

Like most other such things, this is not about investing, it's about communication within their marriage. Useless to discuss that though.

 

[dl003]

PETA going to flip out after this.

because the animals might become smart enough to unionize, making PETA useless?

 

[Green Pete]

I have never considered writing calls or puts because of the increased risk associated. But giving the upcoming 5:1 split and the fact this forum is very bullish I am surprised how much I hear about people writing covered calls but not about writing puts. With the split bringing the cost of a put being exercised to ~400x100 or $40,000k could someone advise as to why as a Tesla bull writing a put would be a bad idea. If it's not exercised you get to keep the premium. If it is exercised you have to buy TSLA, and if you believe the long term thesis you would be happy to do so any way. Is there a downside to this idea that I am not thinking about properly?

You could in theory write one weekly put a week and pull in maybe 1,000 dollars a week or so, and if you are forced to buy, you are buying something you believe has long term value otherwise.

I personally won't do this until next year if I do for various tax reasons, but I was curious on other peoples takes.

 

[TheTalkingMule]

"If you bombard the Earth with photons long enough, it will emit a Tesla."

Phenomenal quote.

 

[juanmedina]

I have never considered writing calls or puts because of the increased risk associated. But giving the upcoming 5:1 split and the fact this forum is very bullish I am surprised how much I hear about people writing covered calls but not about writing puts. With the split bringing the cost of a put being exercised to ~400x100 or $40,000k could someone advise as to why as a Tesla bull writing a put would be a bad idea. If it's not exercised you get to keep the premium. If it is exercised you have to buy TSLA, and if you believe the long term thesis you would be happy to do so any way. Is there a downside to this idea that I am not thinking about properly?

You could in theory write one weekly put a week and pull in maybe 1,000 dollars a week or so, and if you are forced to buy, you are buying something you believe has long term value otherwise.

I personally won't do this until next year if I do for various tax reasons, but I was curious on other peoples takes.

Why not do both? I sold a call to write some puts and I am also going to write some call in my after-tax account hopefully to cover exercising some options.

 

[Oil4AsphaultOnly]

I have never considered writing calls or puts because of the increased risk associated. But giving the upcoming 5:1 split and the fact this forum is very bullish I am surprised how much I hear about people writing covered calls but not about writing puts. With the split bringing the cost of a put being exercised to ~400x100 or $40,000k could someone advise as to why as a Tesla bull writing a put would be a bad idea. If it's not exercised you get to keep the premium. If it is exercised you have to buy TSLA, and if you believe the long term thesis you would be happy to do so any way. Is there a downside to this idea that I am not thinking about properly?

You could in theory write one weekly put a week and pull in maybe 1,000 dollars a week or so, and if you are forced to buy, you are buying something you believe has long term value otherwise.

I personally won't do this until next year if I do for various tax reasons, but I was curious on other peoples takes.

I think you'll find that some/many of us already do sell puts. So to answer your hypothetical: the risk is all the gains you would miss out on to earn what is potentially the equivalent of a 10% annual return. It's definitely a decent return, but relative to what you could've gotten, it's an "opportunity loss".

 

[Krugerrand]

That is one amazing group of diverse individuals working together for the benefit of all. What a very special presentation to witness. I want to invest in that group of people.

 

[vikings123]

I have never considered writing calls or puts because of the increased risk associated. But giving the upcoming 5:1 split and the fact this forum is very bullish I am surprised how much I hear about people writing covered calls but not about writing puts. With the split bringing the cost of a put being exercised to ~400x100 or $40,000k could someone advise as to why as a Tesla bull writing a put would be a bad idea. If it's not exercised you get to keep the premium. If it is exercised you have to buy TSLA, and if you believe the long term thesis you would be happy to do so any way. Is there a downside to this idea that I am not thinking about properly?

You could in theory write one weekly put a week and pull in maybe 1,000 dollars a week or so, and if you are forced to buy, you are buying something you believe has long term value otherwise.

I personally won't do this until next year if I do for various tax reasons, but I was curious on other peoples takes.

I could not agree more. The split allows you to reduce your risk and at the same time get a ‘dividend’. Hop on over to the “applying the wheel” thread and you can learn a ton there.

I will give you another option which leverages margin. I don’t know what kind of account you have but if you are approved for margin, you can use that margin as a collateral for selling puts. This is what I do in my IBKR account. I only use margin as collateral for selling puts, no interest charges. Of course you have to be very disciplined with this kind of margin leverage strategy. This way you can remain fully invested with your cash.

If you get assigned on a sold put you can then sell an aggressive covered call against those shares. You can do this on a weekly basis and earn good dividend by selling puts while using a margin account but not actually pay any interest until you get shares assigned.

Let me just add that this is not for a casual investor and definitely requires time commitment.

 

[lascavarian]

Loved the reference to hydrogen evolving into consciousness.

 

[MTL_HABS1909]

PETA going to flip out after this.

I’m vegan and have no issues with this. From what I saw, they seem to be treating them properly, so PETA should spend their time fighting the factory farming industry, but that’s just my take....

 

[Artful Dodger]

After-action Report: Fri, Aug 28, 2020: (Full-Day's Trading)

Headline: "TSLA Opens with 2 ATHs; Breaks from Macros at Lunch"

Traded: $45,264,630,397.08 ($45.26 B)
Volume: 20,083,686
VWAP: $2,253.80

Closing SP / VWAP: 98.18%
(TSLA closed BELOW today's Avg SP)
Mkt Cap: TSLA / TM = $412.494B / $187.288B = 220.25%​

TSLA 1-mth Moving Avg Market Cap: $321.88B
TSLA 6-mth Moving Avg Market Cap: $190.99B
Nota Bene: Mkt Cap on pace to unlock CEO comp. 3rd tranche Sep 04, 2020

'Short' Report:

FINRA Volume / Total NASDAQ Vol = 49.1% (49th Percentile rank FINRA Reporting)
FINRA Short/Total Volume = 58.5% (54th Percentile rank Shorting)
FINRA Short Exempt Volume was 0.75% of Short Volume (46th Percentile Rank)​

Comment: "Sell-off started at 12:15 pm; Closed up +8% for the week"

View all Lodger's After-Action Reports

Cheers!

 

[JRP3]

I’m vegan and have no issues with this. From what I saw, they seem to be treating them properly, so PETA should spend their time fighting the factory farming industry, but that’s just my take....

I expect PETA and other ethical vegans to claim an animal cannot consent to being experimented on. PETA likes high profile issues so I expect we will hear something from them on this issue if it comes across their radar.

 

[Prunesquallor]

I believe $6800ish was a base case. The bull case was $15,000 by 2024. This is why I won’t sell anytime soon.

End of 2024
Bear: $1500
Expected Value: $7000
Bull: $15,000

 

[Prunesquallor]

I believe $6800ish was a base case. The bull case was $15,000 by 2024. This is why I won’t sell anytime soon.

God I love that woman.
Edit: as in: I love her intellect.

 

[Nocturnal]

Just found out on a finance forum a woman who’s husband had some really bad streak with options. -1.4M. Do you think TSLAQ made another victim and will create another divorce?

This sort of thing is why people like Charts, Skeptic etc. are truly awful humans. It's fine for them to dwell in their craziness, or mock longs etc. but they encourage people to do stupid things by stirring them up. Not so different from when somebody gets fired up about politics and shoots up a pizza parlor.

The answer is easy, but she obviously doesn't understand. Who cares? Making the kind of money she makes the loss is pretty much irrelevant in the long term. Happens all the time.

All she's saying is that he's investing in a manner that's too risky for her. If she didn't want that to happen, she needed to make it clear up front. The real test for this sort of thing is whether she would be complaining like this if he was up $1.4M instead of down. I have my doubts.

Like most other such things, this is not about investing, it's about communication within their marriage. Useless to discuss that though.

Also that. It's 1.5 years salary for her. The big issue is that she can't trust her husband.

 

[Artful Dodger]

"No, Tesla Doesn't Need Regulatory Credits to Make Money (TSLA)" | Tesla Daily (10 min ago)

 

[Bet TSLA]

My guess is that this will become clear, and this coming week will see the last of this mystery rise, with only the last stragglers participating so fairly muted. And then the next week will be down, maybe one third of what the final split rise turns out to be after the coming week. Maybe even down hard on the 28th in anticipation.

So back to 1750 or so by September 4? Of course all bets are off if S&P 500 inclusion is announced. So that wild card will prevent the stock from falling too far. But I think the week starting August 31 is likely to be rather tricky for traders.

I expect I'll write a few puts for fun this coming week, and then not play the week after. And perhaps even turn some calls into a bull spread to protect my gains.

Well, my prediction isn't too far off the mark so far. After going up 49% in the previous eight trading sessions since the announcement of the split, this week we've gone up 9% in four trading sessions. So, as predicted, a continued rise, but comparatively muted. We'll have to see whether tomorrow and next week continue as predicted.

I did write 20 8/28 2130 puts on Monday for $105. Sadly, I called the dip all wrong and wrote them when TSLA was at 2106 rather than at its eventual low of 1927. C'est la vie. Put me rather quickly down over $200K on the trade. But I didn't close the position until this morning, for $17 when TSLA was at 2210, which was about $175K profit.

Doing a little better with catching the dip, later today I wrote 10 8/28 2180 puts for $58 when TSLA was at 2163 (missing the $2140 low by a fair amount). That's $58K potential profit, so far up $39K and we'll see how tomorrow goes. There's a chance I'll get to see them expire worthless, but we'll have to see how the day looks.

I still have my worry expressed above that TSLA may be down hard tomorrow, likely towards the end of the day. But the mood may end up being more anticipatory than worried. We shall see.

And yeah, this monstrous rise is all good for my core position, but short term trading around the edges is fun. And sometimes profitable.

Okay, now we know more. After going up 49% in the eight trading sessions after the announcement of the split, this week TSLA went up 8% in five trading sessions. I'd call that a win on my prediction of a continued rise, but comparatively muted.

As to my worry (not prediction) that TSLA may be down hard Friday towards the end of the day, I'd say it didn't really come to pass. It certainly hit an all-time high early and never regained those heights, and it ended down some, but at this level closing a little over 100 points below the high and only about 1% for the day can't be characterized as "down hard".

And one more prediction to go for next week. I wrote "And then the next week will be down, maybe one third of what the final split rise turns out to be after the coming week." The final rise in TSLA since the split is 1,374.39 -> 2,213.40, which is about 839 (more than I expected). One third of that is 280. Translating to our new post-split prices, my prediction was that TSLA will be down from 442.68 by maybe about 56, so down to around 390 (1950 currently) for the week.

Given that I have still heard no reason why a fundamentally meaningless split seemed to cause this massive stock price rise, I have to conclude that shorts got scared for some reason but that they'll be back in force. So yeah, I still think we'll be substantially down next week. But I suspect we'll be up first on Monday morning unless macros get in the way. And I don't plan to do any trading next week since I feel I don't understand things at all. This is not a strongly held belief, and I have done nothing to reduce or hedge my long calls. Maybe do some of that Monday if TSLA is indeed up some. If we are down that much next week it will certainly hurt. And it continues to be the case that "Of course all bets are off if S&P 500 inclusion is announced." But at this point I agree that it seems likely this won't happen until rebalancing happens, which is later.

As to my success in writing short-term puts, the $175K win from Wednesday was the big one. I also made another $58K from letting the 2180 puts I wrote yesterday expire worthless. In addition I did a day trade (rather unusual for me, and I didn't mean it to be). With TSLA at 2283 this morning I wrote 10 8/28 2225 puts for $11.80, thinking that they would likely expire worthless. They didn't, but I closed out the position in the last few seconds for $10, so I made $1.8K. If I didn't get my price I would have been okay with having the 1000 shares put to me at 2225, and likely selling them on Monday for a profit, probably more than I made this way. Either that or expiring worthless would not have technically counted as a day trade.

 

[Queeg500]

"If you bombard the Earth with photons long enough, it will emit a Tesla."

If you bombard this forum with attention long enough, it will emit a Roadster.