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

[amolina]

*S&P TO ANNOUNCE WHICH CO. TESLA WILL REPLACE ON DEC 11

@JBRR You are such a life saver.
Which one of my daughters/sons do you want?

 

[thx1139]

The have until Dec 18th to complete their buying. Dec 18th could be a nothing-burger if the index funds have bought up all the shares they needed to. But if some of them wait to try and get a lower price until the last min.......Dec 18th could be incredibly volatile.

Would we have any clues that they already have started? I assume the investment firms would be buying with free cash then selling them to own funds on the 18th. Otherwise the funds would have assets not part of the portfolio.

 

[MP3Mike]

So still not clear on just how this will work. So do funds start buying now or on December 18th?

They won't know how much to buy until the 11th. (Or which stock they have to sell.)

 

[chrsk]

Glad i did not sell any of my calls today.

My 650 calls on Friday have a chance to end up ITM

 

[cs_umd]

"Float-adjusted weight"

Does this mean the calculated value will be based on the number of shares excluding Elon's, rather than the full market cap of the company?

Exactly. That's what S&P uses to compute weights for all companies in the index.

 

[corduroy]

 

[Tes La Ferrari]

Happy happy - I think.

Bought 15x 12/18 $950 today- maybe they will pop ITM before expiry.. never know. :-D

I had a limit order in for those all day; and 15 mins before close, they filled.

Sure am glad they did. Now lets make them ITM. Go TSLA go!

 

[Beltsbear]

"Float-adjusted weight"

Does this mean the calculated value will be based on the number of shares excluding Elon's, rather than the full market cap of the company?

Yes. It has always been this way for S&P.

 

[Cherry Wine]

So still not clear on just how this will work. So do funds start buying now or on December 18th?

There are conflicting opinions on this. Personally, I fall into the camp that believes that Index funds are limited to buying within three business days of the inclusion date. Source, SPY prospectus:

"Specifically, the Trustee is required to adjust the composition of the Portfolio whenever there is a change in the identity of any Index Security (i.e., a substitution of one security for another) within three (3) Business Days before or after the day on which the change is scheduled to take effect."

Furthermore, why would an index fund buy early? Their purpose is to simply track the index, not beat it. They should be agnostic to the share price, and could be placing their jobs in jeopardy by purchasing outside the days surrounding the inclusion date.

In other words, I think all of this run-up can be attributed to speculators, benchmarked funds, and others hoping to dump shares to index funds at as high of a price as possible.

 

[Runarbt]

Glad I got a bunch of shares on Cyber Monday sale today! I also don’t have to explain to wifey why I bought a bunch more TSLA lol Here we goooo!

You wife doesnt happen to have an account on TMC?
Yamantasdivar perhaps?

 

[traxila]

Over 600 tomorrow anyone? (again)

I sold about twenty calls on the way down in pathetic attempt to trade what I had suspected over the weekend insofar as a bear attack based on FUD. Did not go well. Sold near the bottom basically. In fairness to me, I have a day job....

To make up for it I ate the loss, and bought 50 calls at different times during the day.

Think I will be OK....

 

[c041v]

who else just blocked PTO on their work calendars 12/18 - am pretty certain I'm not getting any work done that day

Me, as I still have to work at a day job. I guess DARPA will have to wait for their imagery to be interpreted the following Monday.

 

[agastya]

the company it is replacing will not be known until Dec 11.

 

[mars_or_bust]

Guess we'll be listening to lots of polka on this forum in the coming days....

 

[Johan]

Furthermore, why would an index fund buy early? Their purpose is to simply track the index, not beat it. They should be agnostic to the share price, and could be placing their jobs in jeopardy by purchasing outside the days surrounding the inclusion date.

This exactly. An index fund is not a speculator, an index fund that "beats the index" is doing it wrong. Of course they could drive the price up with their mandatory buying but as you say they should be completely agnostic to this phenomenon.

 

[TheTalkingMule]

In other words, I think all of this run-up can be attributed to speculators, benchmarked funds, and others hoping to dump shares to index funds at as high of a price as possible.

Lets not forget short covering. That plus retail and daytrader speculation plus longs completely unwilling to sell gets us here easily. I expect we'll see $650 before any real inclusion buying happens, perhaps more.

This addition is going to be a mess, but it's important for you all to remember.....IT'S ENTIRELY THEIR OWN FAULT. If S&P hadn't held Tesla out for an entire year longer just to please a few of their clients, this would have been easy enough to announce and add with 7 days notice.

 

[Curt Renz]

MarketWatch - updated 5 minutes ago: Tesla stock to be added all at once to S&P 500

 

[ZeApelido]

Musk is deftly trying to destroy all EV competitors:

Elon Musk crashed Arcimoto electric vehicle into a brick wall

 

[Runarbt]

I had a limit order in for those all day; and 15 mins before close, they filled.

Sure am glad they did. Now lets make them ITM. Go TSLA go!

I overpaid - was hoping to buy 20-30, but ended up with 15. Didnt have the cool you have got..

Best of luck!

For once, I will hang on all these call options until expiry day. Maybe even exercise a few on margin.. or not.. Have no idea - might be risky, as "everyone" expect a drop after d-day.

 

[GrandEnigma]

Market cap is based on the total value of all a company's shares of stock. Float is the number of outstanding shares for trading by the general public. The free-float method of calculating market cap excludes locked-in shares, such as those held by company executives and governments.