Don't invest in index funds. There are a LOT of companies working in direct opposition to Tesla's goals, and that often includes many fossil fuel related companies.
Why would you do that when we've only got one planet?
Very odd and quite illogical.
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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
Don't invest in index funds. There are a LOT of companies working in direct opposition to Tesla's goals, and that often includes many fossil fuel related companies.
Why would you do that when we've only got one planet?
Very odd and quite illogical.
Mo City
Active Member
XHabjab
TSLA Bull
Using the latest closing price info on my phone app:
TSLA
Price: $745.21 / share
Market Cap: $137.4B
TM
Price: $121.83 / share
Market Cap: $171.48B
At TM's current stock price, TSLA meets their market cap at 745.21 * (171.48 / 137.4) or
$968.34 / share
... and 4/20 is in just a few days.
Just sayin' ...
Edit: @Mo City beat me to it. Slightly different numbers but similar sentiment.
TSLA
Price: $745.21 / share
Market Cap: $137.4B
TM
Price: $121.83 / share
Market Cap: $171.48B
At TM's current stock price, TSLA meets their market cap at 745.21 * (171.48 / 137.4) or
$968.34 / share
... and 4/20 is in just a few days.
Just sayin' ...
Edit: @Mo City beat me to it. Slightly different numbers but similar sentiment.
Maybe you should handle your investments and let everyone else handle theirs.
In short, the more TSLA investors who understand that it can go much much higher, the quicker it will get there.
So again, I urge all investors to read Frank's detailed analysis (
My Tesla Investment Thesis 2.0: Tesla's Monopoly Potential
CyberDutchie
Active Member
Tesla at 137.41M just passed the market cap of all three German automakers combined (136.35M)
Mike Smith
Active Member
How do you convince F-150 drivers to buy a Cybertruck? Question why CNN even exists. Elon the marketing genius.
adiggs
Well-Known Member
Definitely applies to every stock. Even a small options market - just that there will be a small hedging operation
The market makers, as I understand it, make their money on transaction fees and probably pennies that they scalp from the bid/ask spread on transactions. That works if they are neutral to market movements.
They also get special privileges. At least one of them being naked shorts are available, with a 13 day settlement period (I might have the details incorrect). So that they can take the other side of trades people want to make, without necessarily the requirement to locate shares first when they're taking the short side of a trade (every trade has a buyer and seller).
From one vegan to (apparently) another:
When someone posts important facts with that much attitude, it makes them harder to hear. Don't be that guy.
StealthP3D
Well-Known Member
Whoa! I don't respect Russ Mitchell at all but do we know he physically went to the two hospitals for this story? Where is the evidence? The guy is despicable but that doesn't mean he actually went to the hospitals!
Yeah, if he writes these BS stories for compensation as a journalist, he's even dumber than I thought! He actually just said a fuel cell car is worth considering when shopping for an EV. For those who don't know, there is almost no where to fuel a hydrogen car and the network was shrinking, not growing, last time I looked. So he's either despicable or really is a half-wit that can write complete sentences.
Dude it was a joke. Satirizing people who think only real leather is luxury.
Fox News ran an article on Elon saying this. Given it was Fox it was of course very positive towards Elon and very negative towards CNN.
Probably one of the few times I've ever agreed with Fox.
Interestingly though I find Fox is very neutral or positive towards Tesla, much more so then the other main stream news companies.
Artful Dodger
"Neko no me"
Artful Dodger
"Neko no me"
Indeed, and note that TSLA's Market Cap is already 2x that of VWAG (Volkswagen).
The obvious short term tgt SP just 2 days ago when GoldmanSachs initiated coverage with a buy rating and a target of $864
That SP (with 184.39M shares outstanding after the Feb. Cap Raise) gives TSLA a Market Cap of $159.31B
Elon's 2nd tranche vests when the SP averages $813.49 for 6-mths (inc'd last 30 days).
Artful Dodger
"Neko no me"
I calculate the following:
$171.480 B / 184,390,000 shares = $929.99 / share
So it's not even an ATH for TSLA to exceed Toyota's market cap from today.
Cheers!
So, TSLA needs to be at $951 in order to become the most valuable auto maker in the world.
That would truly mental the shorts.
I can just imagine their reaction.
StealthP3D
Well-Known Member
If true, maybe it's because those running the show think EV's are just there to fill that "niche" environmental market are totally unprepared for what is about to happen.
Perhaps I should have qualified my comment with the big "IF." As in,"if" LJS22's information is accurate, then I am extremely troubled by Mitchell's actions.
I included LJS22's post in my reply. Specifically he or she wrote:
"The fact that a LA Times auto reporter went to a hospital to ask employees about ventilators during a pandemic for the sole purpose of believing that Musk’s donation was not in good faith makes Russ a despicable person."
I included LJS22's post in my reply. Specifically he or she wrote:
"The fact that a LA Times auto reporter went to a hospital to ask employees about ventilators during a pandemic for the sole purpose of believing that Musk’s donation was not in good faith makes Russ a despicable person."
(Also posted this on my blog, because it's quite long. Not sure how TMC is on mobile, but if it's hard to read, you could read this lengthy post here on blogspot instead)
Let's dissect this a bit:
Size of TSLA Options Market
I wrote about this in one my recent blog posts too, but here is a bit more detailed comparison between some of the largest options markets.
These are the option markets with the highest open interest found here. TSLA is ranked #24, and 15 out of the top 20 are not individual stocks but funds.
Looking at this chart, one might think that TSLA is among the largest option markets, but that doesn't tell the entire story. Let's make some calculations to see what these open interests translate into in terms of dollars waged relative to market cap:
#8 BAC: Bank of America
As of March 25th, this is the highest open interest option market of any stock. Looking at Barchart, it appears that 10% of the 4M open interest is (far) OTM call options expiring this week, and these options are trading between $0.01 and $0.11.
Even the Jan'22 options that have decently large open interest, only really cost about $10.
It'd take a lot of time to calculate the exact value of all these outstanding options, but let's say the average price of a BAC option is $5 (I'm very confident it's much lower). Then the value of all outstanding BAC options would be $5 * 100 * 4,000,000 = $2B.
Relative to BAC's current market cap of $187B, that is a little over 1% of market cap.
#15 APPL: Apple
Apple has an even larger number of far OTM options set to expire this week that are worth <$1. It looks to me to be over 15% of all currently outstanding options.
Although there doesn't appear to be that much open interest for LEAPS expiring in 2022 in the case of APPL, there are for example ~25k Jan'21 contracts outstanding at strike prices of $145 and $150 with values of ~$140.
Once again, it's very hard to calculate the exact value of all outstanding options, I'd have to write a program that fetches the information and puts out the value, but for now let's assume the average APPL option contract is worth $60 (probably a lot lower in reality). That'd mean the value of all outstanding APPL options is $60 * 100 * 2,800,000 = $16.8B.
Relative to APPL's current market cap of $1,250B, that is once again a little over 1% of market cap, just like BAC.
#24 TSLA: Tesla
In the case of TSLA, it appears that a far smaller % of all open interest is tied up in far OTM options expiring this week worth <$1. To me it appears to be ~7-8%.
More importantly, there appear to be ~30k Jun'22 contracts outstanding trading at between ~$100 and ~$300, and another 35-40k Jan'22 contracts trading at between $65 and $400.
Due to TSLA's high stock price and high option premiums, the average price of a TSLA option is bound to be far higher than that of APPL/BAC, but let's stick with a very conservative estimation of $70. This'd mean that all outstanding TSLA options are worth $70 * 100 * 1,800,000 = $12.6B.
Relative to TSLA's current market cap of $137B, that is nearly 10%. In other words:
The TSLA options market is an order of magnitude larger than the next largest stock options markets.
As a result, the extent to which TSLA MMs (Market Makers) have to delta hedge is far larger than that of other MMs. This alone would make TSLA a somewhat more volatile stock than other stocks, but what really, fundamentally changes how this all applies to TSLA is the nature of its investor base and those investors' view of what the company is worth. I described the nature of this investor base in my recent blog post:
The Mechanisms That Fueled TSLA'S Meteoric Q1'20 Rise
But in essence it's as follows. TSLA's SP was kept down in the gutter for a very long time, and a lot of big funds that invested in TSLA a couple of years ago (or even as early as 2012/2013) thought it was a good investment back then. Perhaps they bought for $300 with a $500 price target, perhaps they bought for $180 with a $1,000 price target, perhaps they bought in 2012 for $30 with a $300 price target, but all of these investors have one thing in common. They held on to their TSLA investments for years and years, they saw the company progress and its future potential increase, and they've likely updated their price targets accordingly.
Tesla has always been a company with very high potential and a lot investors who believe it could be the largest company in the world in the future, but the fact that the company made so much progress while the SP was being manipulatively kept low, meant that a lot of investors increased their already high price targets even further, and are now even more unwilling to sell until massive massive SP increases.
This is what Tim Seymour and Cathie Woods saw eye to eye on a year ago in this CNBC interview:
When there's a battle between bulls and bears with drastically different viewpoints. The longer this goes on, or in other words "the longer the base", the bigger the breakout once one side loses the battle. This combined with the delta hedging mechanisms, is why TSLA is pretty much the most volatile large stock right now.
Another example of how this works
Say a company reports very strong earnings on a Friday and it shoots up from $550 to $650 in AH trading. Over the weekend all the big funds will be discussing the company's ER and decide whether they want to decrease/increase their positions. Say the good earnings were so good that even at the already higher SP of $650, although some funds want to take profits, more funds want to increase their positions, and the net result is a desired buying of 2M shares at that new SP.
The following Monday the markets open, and the net buying of an initial 1M shares drives up the SP further to $700. Now the valuation has increased another 10% after the initial 20% rise. That means that likely a lot more sellers will show up, who maybe weren't quite tempted enough to sell at $650, so the 2nd 1M shares that the funds wanted to buy post-ER, will be absorbed by the extra sellers that show up at $700.
In the case of TSLA, what happened is that the buying of shares post Q4'19 ER forced MMs to buy even more shares in order to stay delta neutral. So instead of 2M desired by funds, perhaps MMs also had to buy 1M to hedge risk after the price increased to $650 in AH trading. Then the initial buying of 1M shares that drove up the SP to $700, perhaps forced the MMs to buy another 0.5M shares, so now there's still a desire for 2.5M shares by MMs and funds.
But whereas in the first example, a lot of sellers showed up at $700, in the case of TSLA, maybe only an additional 0.5M shares in selling pressure showed up. So then the SP shot up to $750 as 0.5M shares went from old investors to new investors and MMs, but once again the delta hedging effect forced MMs to buy another 0.5M shares due to the increase in SP to $750, so now there is still a desire from MMs and new investors to buy 2.5M shares at a SP of $750.
These numbers are of course not accurate and it's an oversimplication, but it should show how it works. What added more fuel to the fire on February 3rd and 4th is the media attention that TSLA got (typing "should I" in google showed 1st search result "should I buy TSLA?"), and the amount of short term traders that undoubtedly took notice and decided they wanted to profit from this volatility, and of course short sellers who decided enough was enough.
Hopefully this explains why although delta hedging is not unique to TSLA, no, this situation is vastly different from any other stock.
ProfTournesol
Member
I'm wondering, is this:
be made ready for this:
If so, will the cybertruck be build in China first? Ok, it's strange but they don't have legacy infrastructure like Fremont in China.
be made ready for this:
If so, will the cybertruck be build in China first? Ok, it's strange but they don't have legacy infrastructure like Fremont in China.
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