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

[woodisgood]

Ok, so next basket question. How do you make money by selling before expiration date if the SP isn’t over $873?

Until the SP is over 873, all of the worth of the contract is the time value. You can sell [to close] anytime, which is just flipping the contract after it has appreciated. It doesn’t need to be over the strike price.

Note this is different from “selling a call,” which is being on the other end of the contract (promising to sell shares to someone at a fixed price that may or may not be reached in exchange for premium upfront). You need at least 100 shares to do that.

 

[EV forever]

So, what does that mean for you? That they’ve gone up to $59? I’d say it means nothing to you, it’s just more expensive for anyone to purchase a contract now vs when you bought it earlier.

Ok, so next basket question. How do you make money by selling before expiration date if the SP isn’t over $873?

Trade it exactly same way as you would trade stocks.

He could sell it for $59 at open or hopefully higher if there is a spike up in price at open. Say TSLA opens at $837 - the price of the option would be around $63. Of course, for him to sell, someone needs to be willing to buy - not a problem for TSLA options. That is $20 profit per option share or $2000 per option. For 19 options, $38,000 in profit - not bad for a couple of days of work.

The downside is if TSLA price does not go up - then you can lose all your initial investment, and have nothing to show for it. Kind of what has happened to all those call options I purchased just prior to ER . So far, lost about 90% on the May 15 and May 22nd options. Still holding hope for those expiring May 29 and June 19th which have lost >50% value.

 

[Krugerrand]

Yes, but an important aspect of options is the basket does not need to be woven to completion.

Stock price moves, options price moves but with greater amplitude. A move of 5% may translate to options contracts moving perhaps 20% or more depending on the expiry and strike price. You can sell any time. The value of the contracts will decay the closer you get to expiry, to the point they are worthless unless over strike price. If Tesla shoots up to even 850 tomorrow, HG could sell those options for a ~20-40% gain.

And this is where you lose me. A partial basket is not very useful.

How can the parameters/payout of an option change from its original set purchased price?

And how can an option decay during its set parameters? That’s like saying I started with a half woven basket and started unweaving it just because I don’t like the color pink. Where’s the logic in that?

Basket weaving sucks.

 

[CHGolferJim]

People are overlooking a typical Robo-taxi use case IMO...

You own a 5 year old Tesla are a wanting to buy a new Tesla, rather than trade in, you keep the old car and put it out to work.... occasionally when you have visitors it comes in handy..

There are also off-lease cars which are a cheaper source of fleet cars for Tesla.

At the expiry of the lease the owner will lease a new Tesla, and Tesla will add the old car to their fleet.

The peak fleet size of Tesla Robo-taxi's might be something like 60 million, my guess is that 25%-50% of vehicle production might go direct to the fleet in the peak ramp up, but in general there are cheaper ways of building the fleet.

I think a fleet Robotaxi might clear $100 per day, $70 owner approx 24K per year.... $30 Tesla approx 10K per year. (peak)

Or Tesla can own the vehicle and make the whole $34K per year...

I think Elon's 100K valuation comes from numbers like these.

My point is people are overlooking how many privately owned Tesla's will participate in the network during the initial ramp, and to some extent after that. Overtime that $34K per year is likely to drop ...

IMO this mostly probably eventually means fares of around $1 per mile..

So while initial adoption might be lower, some will realise this is a cheap way to travel and more convenient than owning a car, some owners may put their car out to work and simply book a network car for commuting...

I don't think everyone has a good handle on the concept, people are imagining problems that don't exist, and missing opportunities which do exist.

Telsa putting off-lease cars out to work is a great way to lower fleet costs, using private cars is a great way to reward customers, and stage the fleet ramp.

Now that’s a sweet idea. Make your older Tesla a Robotaxi, when it will no longer give you the heebie jeebies having strangers riding around in your car, and use the earnings to cover payments on your new Tesla. $$$!

 

[Krugerrand]

close..

830.01 and he has $19 worth of options. (1×19x100 cents- as one option is for 100 shares)

Anything above 830 is ITM (in the money), but he will need a lot higher to make money, as the option has "time cost/premium", what he paid for them..

However, if he doest have 19x830x100 dollars (u do the math to exercise the call options, he need to sell before expiry.

This seems like learning basket weaving in Greek. I don’t speak that language, btw.

I can’t give your post a helpful vote because while factually (I’m assuming), I did not find it helpful because I’m a dolt.

 

[woodisgood]

The downside is if TSLA price does not go up - then you can lose all your initial investment, and have nothing to show for it. Kind of what has happened to all those call options I purchased just prior to ER . So far, lost about 90% on the May 15 and May 22nd options. Still holding hope for those expiring May 29 and June 19th which have lost >50% value.

Yeah the rug pull right after ER combined with battery day being moved basically destroyed May call options. There was ~an hour long window at the open day-after ER where profits were decent...after that everything was crushed and in the red.

But that’s the exact reason why short-term options are risky and you can only play with what you can stand to lose. Still hurts though!

 

[woodisgood]

And this is where you lose me. A partial basket is not very useful.

How can the parameters/payout of an option change from its original set purchased price?

And how can an option decay during its set parameters? That’s like saying I started with a half woven basket and started unweaving it just because I don’t like the color pink. Where’s the logic in that?

Basket weaving sucks.

It’s like the basket making materials themselves have a value. But if you haven’t made a basket by their expiration date they just rot away.

Before that, you can sell them to someone else who thinks they can get a basket done in time.

 

[Krugerrand]

Bloomberg says $195B, and they make their money out of this sort of thing, so now I don't know who to believe. Anyway, I was quoting Yahoo Finance. ETrade says 164.9B.

Doing a little more thinking, the NYSE symbol "TM" represents ADRs (depository receipts, that is there's an entity here that holds shares in Toyota on its home exchange (presumably Nikkei). This is analogous to TL0.F, which are the Frankfurt exchange shares in TSLA. It could be that some of the numbers are just for the ADRs, while the others are the valuation on the home exchange.
Yahoo Finance shows:
View attachment 543717

Exchange rate JPY->USD is .00929 (Oanda.com) so the market cap at Japan close (before US opened today) calculates out to 163B$. So my speculation above was wrong, and Google is definitely wrong.

So, we’ll call TSLA the victor when it reaches 200B market cap.

 

[Krugerrand]

'Cuz he can sell them on the market for $59 (more or less) tomorrow morning, and pocket the difference.

Ah, ok. That I can understand.

 

[ggr]

A quick reminder that Monday next week is Memorial Day and the markets will be closed in the US. Funny things happen on short trading weeks. That is often because the big institutional traders take vacation, though, and that may not happen next week. In other words, we know nothing except that the market will be closed.

 

[Krugerrand]

It’s like the basket making materials themselves have a value. But if you haven’t made a basket by their expiration date they just rot away.

Before that, you can sell them to someone else who thinks they can get a basket done in time.

Ohhhhhhh. Ok, I can grasp that concept. Sounds just like catnip that loses its potency once exposed to the air and/or over time.

 

[Artful Dodger]

This seems like learning basket weaving in Greek. I don’t speak that language, btw.

I can’t give your post a helpful vote because while factually (I’m assuming), I did not find it helpful because I’m a dolt.

Lol, think of Options trading in terms of ST:TNG S1E1/2 "Encounter at Far Point":

• Market Makers are Q
• Shortzes are the Paramilitary Police
• You are Picard
• You are on Trial
• The Trial never ends
• Options traders are the Jeering Gallery

Jeers!

 

[TheTalkingMule]

Top safety official at Waymo self-driving unit stepping down

 

[woodisgood]

Ohhhhhhh. Ok, I can grasp that concept. Sounds just like catnip that loses its potency once exposed to the air and/or over time.

I think you’re ready.

 

[juanmedina]

"Tesla Will Beat Guidance in 2020: Delivery/Production Estimates for Q2 and Full-Year"
Tesla Daily - May 21, 2020

• Tesla delivery and production forecasts for Q2 and full-year 2020
• With Giga Shanghai and Model Y ramping up, Tesla is poised to exceed their 2020 guidance and deliver more than 500,000 vehicles on the year
• Q2 production and deliveries will likely outpace TSLA expectations
• Full forecast walkthrough and methodology

83k deliveries estimated for Q2. What will that do for the SP short term?

 

[TSLA_Hopeful]

Did someone post this? I thought it was kinda funny. Before I get flamed seven year long over here.

 

[Maitri982]

Tip: Don't trade on marketing presentations coming out of China.

In don't, but to ignore this could be foolhardy. Was hoping someone might discount it or lend credibility to it.

 

[aronth5]

We know the Model 3/Y battery packs aren't designed for easy swapping like the S/X so be careful when making assumptions.

wait is this true? I was under the impression module swapping was possible on all teslas.

edit: no. batteries are the 3 are swappable. its not like batteries in a flashlight but its not impossible.

Elon Musk makes incredible claims about Tesla Model 3 longevity, will offer battery module replacement - Electrek

Sorry to say but the swap capability Tesla demonstrated and touted many years ago isn't a thing any longer.
I remember watching the initial LIVE demonstration of a Model S battery swap compared to an Audi getting a full tank of gas. Great theatre but not really functional.
Another reason why the million mile battery is important for the Robotaxi capability.
Elon Musk Shares History Of Tesla Battery Modules & Why They Are Going Away | CleanTechnica
"Tesla CEO Elon Musk shared in an episode of the Third Row Tesla podcast that went live this week that the company is moving away from the concept of battery modules in future pack designs.
“The modules in the Model 3 are not actually interchangeable, so there’s no point in having modules really, we should just have a pack.”

Video: How To Remove The Tesla Model 3 Battery Pack | CleanTechnica
"Walking through the process makes it clear that the Model 3 was not designed with battery swapping in mind and requires the removal of dozens of bolts, numerous high-voltage cables, and 7 or 8 coolant lines that run into and out of the battery pack."[/QUOTE]​

 

[mickle]

Sorry to say but the swap capability Tesla demonstrated and touted many years ago isn't a thing any longer.
I remember watching the initial LIVE demonstration of a Model S battery swap compared to an Audi getting a full tank of gas. Great theatre but not really functional.
Another reason why the million mile battery is important for the Robotaxi capability.
Elon Musk Shares History Of Tesla Battery Modules & Why They Are Going Away | CleanTechnica
"Tesla CEO Elon Musk shared in an episode of the Third Row Tesla podcast that went live this week that the company is moving away from the concept of battery modules in future pack designs.
“The modules in the Model 3 are not actually interchangeable, so there’s no point in having modules really, we should just have a pack.”

Video: How To Remove The Tesla Model 3 Battery Pack | CleanTechnica
"Walking through the process makes it clear that the Model 3 was not designed with battery swapping in mind and requires the removal of dozens of bolts, numerous high-voltage cables, and 7 or 8 coolant lines that run into and out of the battery pack."​

[/QUOTE]

With the Robotaxi network you will just swap cars instead of batteries. For example, SF to LA, taxi takes you halfway, stops at a supercharger. You hop out and into a waiting fully charged taxi. It leaves immediately for rest of trip.

 

[Zaxxon]

Ohhhhhhh. Ok, I can grasp that concept. Sounds just like catnip that loses its potency once exposed to the air and/or over time.

Yes, options are very much like catnip.