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

[Curt Renz]

A lot of analysts’ advice seemed to be:

Wait and see...

...the price keep going up.

Indeed. Their problem is that most of them have been trained to evaluate long established companies in the auto industry. They're focused on the standard financial metrics as they would apply to a company's recently finished quarter and projections for the following quarter. Those are the figures they must show their bosses in order to justify their ratings for a stock and its price target. Anticipating the future growth potential of an innovative young company that is totally disrupting both the auto and energy industries is beyond most of their pay grades.

 

[Tslynk67]

5x on Mar 2020 $355 calls.

Yeah, 22x on those Jan 2021 $650's - could be zero tomorrow or 1000x 12 months for now. Pfff!

 

[PlaidCPA]

It's pretty crazy to have 60% of your liquid assets in far out of the money call options unless it's just a really small account and you are young and don't really need it. To be clear, I am not in that position at all. TSLA only comprises a bit over a third of my accounts and TSLA options a lot less than that.

Options and stocks are two completely different beasts, especially options with strike prices so far above the current share prices. But personal situations vary so widely that I can't give you any meaningful guidance.

Completely agree. This is a major dilemma I have and its been a wild ride. Cant focus on work because I don't know what to do with these options. (Good problem to have I suppose). Based on my calculations I lose 15K every couple of weeks due to time decay. Oh well I will post when I close my position to present a real rags to riches story or the opposite lol

 

[Cherry Wine]

Completely agree. This is a major dilemma I have and its been a wild ride. Cant focus on work because I don't know what to do with these options. (Good problem to have I suppose). Based on my calculations I lose 15K every couple of weeks due to time decay. Oh well I will post when I close my position to present a real rags to riches story or the opposite lol

The theta on those is only .07 (7 * 14 = 68 per contract every two weeks) - are you saying you have 200 contracts?

 

[AlexS]

Y

It looks like Tesla needs a ~$500 share price to become the number 2 auto maker in market cap. Right now it's number three after Toyota and VW.

You are wrong, Tesla is already #1 auto maker + every other side business they are running

 

[PlaidCPA]

The theta on those is only .07 (7 * 14 = 68 per contract every two weeks) - are you saying you have 200 contracts?

202 contracts cost basis 28K

 

[Curt Renz]

Dow Jones Newswires: "Tesla Unit in Agreements With Chinese Lenders for Term Loan Facility and Revolving Loan Facility...Tesla Shanghai Repays Bridge Loan"

New Tesla 8-K: SEC Filing | Tesla, Inc.

 

[AlMc]

I appreciate the occasional posts with details of (call) options bought. I have a feeling that I see fewer posts from people with details of how they get out of these options (exercise, sell, worthless expiration...). Maybe this is just because the number of call contracts owned by TMC posters is increasing, but I think I and others could learn something from posts with details of how people get out of their (call) options.

Thanks in advance.

Answering that question is difficult as it depends on taxable vs non taxable account that holds the contracts. personally, I only keep them in retirement accounts so that no tax is due. If in a taxable account it depends on your tax bracket/can you convert to shares with no tax consequence...etc/etc.

EDIT: Back in 2013 I had several large positions in calls in a taxable account and paid a hefty sum as most were ST and the proceeds pushed me into another tax bracket....It was a 'first world problem' but it taught me a lesson.

 

[Thekiwi]

Why do some people buy very low strikes?
They are not getting any leverage for their money, but get a ton of risk compared to shares.
See the top and bottom.

These are 1/22s that still have 2 years to run.
View attachment 492952

"They are not getting any leverage for their money"

They are getting leverage, even at those low strikes' and pay little in the way of premium for it. For stocks that don't pay any dividends, this sort of play is not a terrible idea.

 

[Chickenlittle]

Hi StealthP3D.
I hold many Jan. 2021 $690 calls. I am lost as to what to do about them because they grew to 60% of my total portfolio and I am not sure what the hell to do at this point. I don't like options that are so out of the money with 1 year expire to be 60% of my portfolio. At the same time it hurts me to even think about selling them because I am waiting on SP 500 inclusion and I think TSLA will reach 550-700 a share in 2020. Whats your philosophy regarding these particular options? I am glad to hear that someone else is in this position.

How can you invest in options not knowing what to do with them? See this a lot when tesla does a run, inexperienced option traders asking advise on what to do next. Typically ends bad. Your brokerage should have asked your experience in option trading before granting you option rights.

 

[Duffer]

Seeking fAilure has another article hitting the newsfeeds.

"Tesla's Q1 and Q2 2020 will be disastrous"

I won't give them the click but the first part of the story praises Elon for orchestrating the short burn of the decade perfectly. Saying that Q4 will likely be a record quarter...

 

[sparcs]

Dow Jones Newswires: "Tesla Unit in Agreements With Chinese Lenders for Term Loan Facility and Revolving Loan Facility...Tesla Shanghai Repays Bridge Loan"

New Tesla 8-K: SEC Filing | Tesla, Inc.

Media seemed to like that one:

Marketwatch: Tesla confirms loans for 'Gigafactory' in China

Bloomberg: Tesla Confirms $1.6 Billion in China Bank Financing for Factory

Reuters: Tesla secures $1.29 billion loan from Chinese banks for Shanghai factory

 

[Carl Raymond]

How can you invest in options not knowing what to do with them? See this a lot when tesla does a run, inexperienced option traders asking advise on what to do next. Typically ends bad. Your brokerage should have asked your experience in option trading before granting you option rights.

“Don’t try this until you are experienced”?

 

[Green Pete]

How can you invest in options not knowing what to do with them? See this a lot when tesla does a run, inexperienced option traders asking advise on what to do next. Typically ends bad. Your brokerage should have asked your experience in option trading before granting you option rights.

How bad can it really end tho. Either they end up worthless, you sell early and end up in a tax conundrum, or you hold until they qualify for long term capital gains

 

[PlaidCPA]

How bad can it really end tho. Either they end up worthless, you sell early and end up in a tax conundrum, or you hold until they qualify for long term capital gains

What are the chances that these options go ITM? SP500 inclusion should have a huge effect. Look at Twitter 60%+ just by inclusion. What I am really trying to figure out is what is the chance TSLA closes 2020 at 800?

@chikenlittle, I am not sure whose question you are answering.

 

[adiggs]

Another sign of the changing times re EV's
Here is a "tech article" paid for by Polestar on Huffpost:
Ten Facts About Electric Cars You’ve Been Getting Wrong | HuffPost
And its brand agnostic.

That is fricking awesome. Polestar gets a thumbs up from me.

 

[Green Pete]

What are the chances that these options go ITM? SP500 inclusion should have a huge effect. Look at Twitter 60%+ just by inclusion. What I am really trying to figure out is what is the chance TSLA closes 2020 at 800?

@chikenlittle, I am not sure whose question you are answering.

Mine cross into LT in September. I'm just sleeping on it till then and will revaluate. I went into it ok to loose it all. Now that it's a bit more than I put in incant claim to not checking the SP way too often but whatever.

 

[M3Rider]

What I am really trying to figure out is what is the chance TSLA closes 2020 at 800?

Depends on who you ask. If you want an answer you'll like, ask @anthonyj.

 

[Toumal]

Seeking fAilure has another article hitting the newsfeeds.

"Tesla's Q1 and Q2 2020 will be disastrous"

I won't give them the click but the first part of the story praises Elon for orchestrating the short burn of the decade perfectly. Saying that Q4 will likely be a record quarter...

And if Q1/2 2020 are not a disaster, Q3/4 2020 will definitely be! Or Q1/2 2021. Or Q3/4 2021...

 

[M3Rider]

but the first part of the story praises Elon for orchestrating the short burn of the decade perfectly.

What if it's not yet perfect? What if Q1 beats Q4 and we get SP500 after that? Then it might be perfect.

Shorties- don't mind what I said, pretty sure I'm wrong.