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

[Crowded Mind]

I did a bit of testing around this, by looking at trends for search phrases that should not have much daily / monthly variation (e.g. "what day is it?"). In those graphs, you do not see some massive drop in search % over the last month or so.

So the Tesla drop is not due to a massive increase in overall search volume. It is due to simply less people searching for Tesla Model S/X/3.

To reiterate, Model 3/S/X search demand in the U.S. and worldwide has dropped 50% in over the last 3 months. I don't see how this cannot affect Q2 demand / ASP significantly unless search volume starts coming back up, and soon.

This does not affect any of my long-term bullishness on the stock, but combined with the COVID fears looming, I have sold half my stock (all that in my IRAs) betting that I will be able to end up acquiring more shares at a cheaper price sometime in the next few weeks.

However I probably don't want to be out before the Buffalo / Battery day events.

But Q2 guidance might not be friendly.

I disagreed with the original post by @StealthP3D, but forgot to then explain why. Google Trends indexes the search data only for the terms that are entered for comparison. So if you are looking at the search interest for Model 3 over time, it is displaying the periodic variance, not the variance relative to Google’s overall search interest. This still applies when adding other search terms. It’s only comparing the terms you are selecting. Overall Google search traffic is completely irrelevant for Google Trends other than the impact overall volume happens to have on the individual search term you are viewing.

The post I am quoting here has the correct idea.

 

[StealthP3D]

Posted on my updated analysis, with which you seemingly haven't actually responded to. You just reposted the same normalization description.

What I posted is Google's own description of how the data is normalized for the total volume of searches. You can see it here:

FAQ about Google Trends data - Trends Help

Do you understand my additional analysis? If you think total search volume doubled (but not for Tesla) then it's likely concentrated in Coronavirus news (maybe). Why would search for "what month is it" increase in absolute search activity, but not Tesla searches?

I don't need to analyze your analysis because Google has already told us exactly how they derive the numbers. Interestingly enough, the Model Y bucked the trend by increasing in search ranking over the past two months (and over the past year). This is a normal response (new products get much higher search rankings as they begin production ramps and start to get released to the public while other models take a back seat).

 

[StealthP3D]

I disagreed with the original post by @StealthP3D, but forgot to then explain why. Google Trends indexes the search data only for the terms that are entered for comparison. So if you are looking at the search interest for Model 3 over time, it is displaying the periodic variance, not the variance relative to Google’s overall search interest. This still applies when adding other search terms. It’s only comparing the terms you are selecting. Overall Google search traffic is completely irrelevant for Google Trends other than the impact overall volume happens to have on the individual search term you are viewing.

The post I am quoting here has the correct idea.

Please see here:

FAQ about Google Trends data - Trends Help

Also, the following link is to an article by Simon Rogers written to help people use Google Trends data in various analyses:

What is Google Trends data — and what does it mean?

It has this to say:

"What’s most useful for storytelling is our normalized Trends data. This means that when we look at search interest over time for a topic, we’re looking at that interest as a proportion of all searches on all topics on Google at that time and location."

There is not any grey area here - it's pretty black and white. You can argue that searches have not been increasing because of Coronavirus but it just makes one look silly to argue that Google Trends does not normalize for total search volume.

If you want to argue this further I suggest you create a separate thread for analyzing Google Trends data.

 

[Nocturnal]

I don't know about you guys, but to me, it would be in the best interest of national security if Russia and the Saudis couldn't decide to crash our economy whenever they wanted. Hmm, are there any other large nations that have leadership interested in tackling long term risks and investing in the future? I wonder what technologies they are pushing? (I assume the answer is no longer solar/EVs AND bat soup)

 

[Crowded Mind]

The methodology Google says they use disproves your rather transparent attempt to create a false impression:


I'm going to trust Google on this one. They normalize the search score for the total volume of searches.



OK, so it looks like your attempt to create a false impression aligns very well with your personal financial stake. It's not a good look.

I'm pretty confident you are misinterpreting this. Here is what Google says about the search index over time that we are discussing.

"Interest over time
Numbers represent search interest relative to the highest point on the chart for the given region and time. A value of 100 is the peak popularity for the term. A value of 50 means that the term is half as popular. A score of 0 means there was not enough data for this term."

The index is self-referential, not total Google search referential. The explanation you posted here is for geographical indexing, not time indexing. Google normalizes for geography on the geographical index because, as they say, otherwise the highest population density would always index the highest. This is not relevant for the time index.

 

[Artful Dodger]

After-action Report: Wed, Mar 25, 2020: (Full-Day's Trading)

VWAP: $538.96
Volume: 21,253,608
Traded: $11,454,803,966.77 ($11.45 B)

Closing SP / VWAP: 100.05%
(TSLA closed ABOVE today's Avg SP)​

FINRA "Short Exempt" / "Short Volume" = 0.44% (Pre-Market + Main Session Only)

Comment: "Strong Opening; Capping during the day; Up $34.25 (6.8%) for the day"

 

[ZeApelido]

This just in:

Interest in the band Fleetwood Mac has exploded in the last 20 months by remaining flat in Google Trends, since absolute search volume must have doubled

 

[Crowded Mind]

Please see here:

FAQ about Google Trends data - Trends Help

Also, the following link is to an article by Simon Rogers written to help people use Google Trends data in various analyses:

What is Google Trends data — and what does it mean?

It has this to say:

"What’s most useful for storytelling is our normalized Trends data. This means that when we look at search interest over time for a topic, we’re looking at that interest as a proportion of all searches on all topics on Google at that time and location."

There is not any grey area here - it's pretty black and white. You can argue that searches have not been increasing because of Coronavirus but it just makes one look silly to argue that Google Trends does not normalize for total search volume.

If you want to argue this further I suggest you create a separate thread for analyzing Google Trends data.

Thanks for sharing the Simon Rogers piece, I think that cleared it up for me and I think you are indeed correct. They do normalize the data because otherwise as traffic grows, the index would be biased to overindex recent popularity from the natural traffic growth. I'll concede that point. However, I also think it is folly to assume total google search traffic has doubled or close to it over the last couple months. That seems entirely unrealistic. Even with the normalization, it seems likely that search interest is lower for Tesla right now. Not that that is some super ominous sign or anything. Responding here because I think this is relevant to TSLA.

 

[MC3OZ]

Sanders is standing up for the wage workers as the GOP tries to make changes to the bill that would reduce unemployment benefits.

I disagreed with you because it's GOP senators who would be delaying the bill by adding last-minute changes (reducing benefits for the working guy) and Sanders is saying "Oh, no you don't".

My thoughts we will get a deal because both side of politics want a deal.

Reps and Trump - need a deal desperately with a week (think about a section of Trump's base who have struggled since the GFC)
Dems - want a deal but not urgent, but don't want to be seen to be causing the hold up. Not too worried if a deal needs to be renegotiated, they will get a better deal.

So a deal in the next 1-2 weeks is a 99% certainty IMO

Any delay may move the market down and any deal conformation may move it back up..

Is the money A) Too Little, B) Too Much C) Just right - no one knows but in all cases the risk is minimal

The main risk is B) Too Much causing inflation - I think the money is mostly going to prop up failing industries and prevent / delay mass layoffs ... once that is done there will not be much left - the inflation risk is minimal.

A) Too Little - it will at least buy time for more action down the track,,,

So overall there is little chance of the economic stimulus not keeping a lot of things afloat until the health emergency ends...

And Trump more than anyone desperately needs a win here. the health and economic response to COV-19 can't be spun, others can't be blamed, The ball is in his court and everyone is watching... those GOP senators need to wake up to the political reality, this is a time for taking any deal you can get, not playing hard-ball on ideological grounds.

 

[Bullish_Bear]

Any tax incentive in stimulus bill for EVs？ Thanks！

 

[Singuy]

Pierre Ferragu Pierre Ferragu on Twitter

View attachment 525612

Aren't we inflated more with higher PE companies like Amazon, fb, Google, and apple because they are so much better at making money vs companies back in 2008?.

 

[TheGrimSweeper]

Any tax incentive in stimulus bill for EVs？ Thanks！

 

[StarFoxisDown!]

Any tax incentive in stimulus bill for EVs？ Thanks！

I'm all for Tesla taking some cheap loan money(they don't do buybacks and they definitely aren't laying off people so pretty easy to hit the loan requirements)......but I'm actually against EV stimulus like the return of the EV tax credit. Tesla's already past the critical point where they don't need it and bringing it back only helps companies that have intentionally stalled their EV programs........so screw'em

 

[StealthP3D]

Thanks for sharing the Simon Rogers piece, I think that cleared it up for me and I think you are indeed correct. They do normalize the data because otherwise as traffic grows, the index would be biased to overindex recent popularity from the natural traffic growth. I'll concede that point. However, I also think it is folly to assume total google search traffic has doubled or close to it over the last couple months. That seems entirely unrealistic.

Sigh - I never suggested that total Google traffic has doubled, the 100 people search for "Tesla Model Y" and "Coronavirus" was simply a greatly simplified example to explain what it means to normalize results for total search volume - the numbers were not intended to be realistic representations of actual search traffic. However, I would be interested to know if overall Google searches are trending higher in volume but I can't seem to find that data at Google.

Even with the normalization, it seems likely that search interest is lower for Tesla right now. Not that that is some super ominous sign or anything.

Google Trends makes it obvious that searches for "Tesla Model Y" are actually up over the last couple of months. And it would be normal for older models Like the S, X and 3 to play second fiddle during the Model Y ramp and release to customers.

This is not surprising or particularly notable.

 

[Crowded Mind]

Google Trends makes it obvious that searches for "Tesla Model Y" are actually up over the last couple of months. And it would be normal for older models Like the S, X and 3 to play second fiddle during the Model Y ramp and release to customers.

This is not surprising or particularly notable.

Not surprising perhaps, but it would be contradictory to Elon’s example of the Model X (IIRC?) increasing demand for Model S and citing that as a reason to not expect cannibalization for the 3 from the Y. And while Model Y is up, as would be expected with a launch, overall Tesla is down while one would expect a vehicle launch to drive that interest up as well. It’s not something I’m too concerned about (as a long, for anyone reading that can’t handle any degree of negativity) but it’s also not the most positive sign.

 

[Artful Dodger]

Please see here:

FAQ about Google Trends data - Trends Help

Also, the following link is to an article by Simon Rogers written to help people use Google Trends data in various analyses:

What is Google Trends data — and what does it mean?

It has this to say:

"What’s most useful for storytelling is our normalized Trends data. This means that when we look at search interest over time for a topic, we’re looking at that interest as a proportion of all searches on all topics on Google at that time and location."

There is not any grey area here - it's pretty black and white. You can argue that searches have not been increasing because of Coronavirus but it just makes one look silly to argue that Google Trends does not normalize for total search volume.

If you want to argue this further I suggest you create a separate thread for analyzing Google Trends data.

That's probably enough commentary on 'Google Trends' algorithms.

—

Mod: hey, that’s my font colour!

RSF

 

[Thekiwi]

Aren't we inflated more with higher PE companies like Amazon, fb, Google, and apple because they are so much better at making money vs companies back in 2008?.

Those companies have smaller P/E ratios than they did then.

 

[tschmidty]

I'm all for Tesla taking some cheap loan money(they don't do buybacks and they definitely aren't laying off people so pretty easy to hit the loan requirements)......but I'm actually against EV stimulus like the return of the EV tax credit. Tesla's already past the critical point where they don't need it and bringing it back only helps companies that have intentionally stalled their EV programs........so screw'em

Disagree 'cause bringing back the tax credit only indirectly benefits Tesla by making their cars cheaper.

 

[MP3Mike]

but I'm actually against EV stimulus like the return of the EV tax credit. Tesla's already past the critical point where they don't need it and bringing it back only helps companies that have intentionally stalled their EV programs........so screw'em

Wrong. The EC tax credit still exists for the companies that have stalled. So bringing it back would currently only benefit Tesla and GM consumers by lowering the price of the cars from them. But if it is brought back it should be modified to end for everybody at the same time. i.e. encourage them to all start moving quickly.

 

[ZeApelido]

Sigh - I never suggested that total Google traffic has doubled, the 100 people search for "Tesla Model Y" and "Coronavirus" was simply a greatly simplified example to explain what it means to normalize results for total search volume - the numbers were not intended to be realistic representations of actual search traffic. However, I would be interested to know if overall Google searches are trending higher in volume but I can't seem to find that data at Google.



Google Trends makes it obvious that searches for "Tesla Model Y" are actually up over the last couple of months. And it would be normal for older models Like the S, X and 3 to play second fiddle during the Model Y ramp and release to customers.

This is not surprising or particularly notable.

Yes, and for January 2020, the increase in Model Y would explain the drop in Model 3. In the last month, there is a clear drop in aggregate presumably b/c of coronavirus taking up mindshare (less money in the account means less thinking about buying a new shiny object). This can be confirmed if you look at trends for "tesla model". Pretty flat until late February, then like a 35% drop. Not as bad as the 50% drop of Model 3.

Let's monitor and see when it pops back up.