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TSLA Market Action: 2018 Investor Roundtable

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This is fundamentally incorrect. Any longs who just sat there in TSLA while it has done nothing for 2 years has missed out on the opportunity cost of the broader market gaining in value. Certain stocks, and I've mentioned AMZN before, have quadrupled in value while TSLA has remained flat overall. So yes, longs in TSLA, even if all they have done is sat on their stake and done nothing, have lost a lot of money and it's high time for TSLA to start performing in line with expectations people have for a growing company.

The reality is that if you had simply sold your entire TSLA stake every time it got to 350 and bought it again when it dropped to 260 the last 2 years you would have made a lot of money instead of just sitting on it. I know a guy who did this and he told me to do it and I didn't believe it. Well he has enough money from doing this to buy a P3D with just the proceeds of doing this and I have made nothing from my TSLA stake the past 2 years.

So don't bulls**t about "not losing anything". In a bull market, not losing anything is actually losing a lot when you could be gaining a lot elsewhere.

Making money in the stock market is easy when you can predict the future.
 
Ark Invest is one of the very few companies that profoundly understand the true differentiation and competitive edge Tesla brings to the market. The similarities between Apple and Tesla are mind blogging. In fact I wrote a piece about it Monday that I intend to publish soon...

This is another great analyses from Ark and shows us how important it is to look at the big picture. One of the large misunderstanding between bulls and bears is simply the time horizon you look at.

Bears do not want to think about what Tesla will be like in 10 years.
Bulls only want to think about what Tesla will be like in 10 years

Thanks @Papafox for that link

Tesla Through the Lens of Apple - ARK Investment Management
 
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And now this... Wild speculation that they drop the Q3 results and this is the look on Wall Street...

B52EC8DB-0F73-4DF9-AE63-122B0AD81547.png
 
Something about that post doesn’t really lend to its credibility or the credibility of that account.
You have to go back and read my other post referring to a discussion by US officials in Saudi about a big deal in a couple weeks (now) on something "far from Oil." In the same conversation, Tesla came up as the Prince really likes it. (Obviously after buying 5%). So not sure why this is not believable, unless you don't want to believe? I'm just connecting Elon's timely tweet with a possible deal with Saudi. No one knows for sure, see you in 12 hrs...
 
See paragraph 4

Scribd

(It's an end run around the literal wording.)

Paragraph 4 of the settlement between the SEC and Tesla [Defendant] says, in part:

"4. Defendant agrees that it shall not seek or accept, directly or indirectly, reimbursement or indemnification from any source, including but not limited to payment made pursuant to any insurance policy, with regard to any civil penalty amounts that Defendant pays pursuant to the Final Judgement, regardless of whether such penalty amounts or any part thereof are added to a distribution fund or otherwise used for the benefit of investors. [....]"​

Sale of equity at market prices is not reimbursement nor indemnification, even if the $20m figure and the timing of the equity sale is obviously not accidental. Tesla's Q4 bottom line income is still harmed by -$20m due to the settlement forced upon them by the SEC.

And yes, literal wording is 90% of contract law, it's the reason why even routine consumer contracts can be hundreds of pages long. Neither Elon nor Tesla has any obligation to go beyond the four corners of the contract between them and the SEC. It's patently obvious that they disagree with the intent of the SEC, plainly expressed in the lawsuit, which was to help short seller anti-shareholders at the expense of Tesla shareholders.

One could even argue that Tesla and Elon has the fiduciary duty to resist and neutralize the SEC's unlawful attempts to help short seller anti-shareholders, to the maximum extent lawfully possible. It's also highly probable that this equity sale was approved by Tesla's lawyers, and it's also probable that SEC lawyers were aware of what effects the settlement had on future equity sales.

If the SEC wanted to avoid this scenario they should have and could have worded the settlement differently.
 
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Edit: I hold exclusively February and August 2019 call options. The reasoning is simple:

BTW., also note that the 2019 January 18 PUT options open interest is insanely high, it represents over 80% of all 2019 options at the moment:
Code:
2018/Nov/23:  PUTs:     2,034 ; CALLs:     3,471
2018/Nov/30:  PUTs:       943 ; CALLs:       862
2018/Dec/21:  PUTs:    97,132 ; CALLs:    62,382
2019/Jan/18:  PUTs:   477,119 ; CALLs:   224,213
2019/Feb/15:  PUTs:     9,168 ; CALLs:    15,057
2019/Mar/15:  PUTs:    77,956 ; CALLs:    40,668
2019/Jun/21:  PUTs:    69,954 ; CALLs:    43,403
2019/Aug/16:  PUTs:    20,879 ; CALLs:    12,620

This means that the moment the 2019/Jan/18 options expire, a lot of TSLA short inventory held by market makers might be freed up - i.e. TSLA might be bought and even of the 2019/Jan expiry closing price will be plaid to force maximum pain, the next expiries won't be nearly as constrained and the stock price might catch up to real valuation and expectations ...

The Feb/15 expiry will also include the pricing of the Q4 earnings report.

Just for kicks, here's the open interest straddle table of the January expiries:
Code:
 PUT $  3:    297, CALL $  3:      2
 PUT $  5:     36, CALL $  5:      0
 PUT $  8:     10, CALL $  8:      0
 PUT $ 10: 35,186, CALL $ 10:      2
 PUT $ 10:     84, CALL $ 10:    112
 PUT $ 13:     30, CALL $ 13:     35
 PUT $ 15:  2,090, CALL $ 15:      1
 PUT $ 15:  2,238, CALL $ 15:     28
 PUT $ 17:     90, CALL $ 17:     55
 PUT $ 20: 19,572, CALL $ 20:      3
 PUT $ 20:     55, CALL $ 20:    395
 PUT $ 22:     10, CALL $ 22:    347
 PUT $ 25: 10,989, CALL $ 25:      0
 PUT $ 25:    127, CALL $ 25:    282
 PUT $ 27:     24, CALL $ 27:  1,239
 PUT $ 30:  2,398, CALL $ 30:      0
 PUT $ 30:     21, CALL $ 30:    563
 PUT $ 35:  3,437, CALL $ 35:      0
 PUT $ 35:     24, CALL $ 35:    275
 PUT $ 40:  2,276, CALL $ 40:     10
 PUT $ 40:     31, CALL $ 40:    163
 PUT $ 45:  2,997, CALL $ 45:      7
 PUT $ 50: 75,540, CALL $ 50:      8
 PUT $ 55:  3,579, CALL $ 55:      3
 PUT $ 60:  2,500, CALL $ 60:      0
 PUT $ 65:    825, CALL $ 65:      1
 PUT $ 70:  6,496, CALL $ 70:      7
 PUT $ 75:  8,014, CALL $ 75:    209
 PUT $ 80:  4,550, CALL $ 80:    160
 PUT $ 85:    759, CALL $ 85:    319
 PUT $ 90:  3,145, CALL $ 90:    326
 PUT $ 95:  2,257, CALL $ 95:    219
 PUT $100: 48,048, CALL $100:  3,438
 PUT $105:  1,418, CALL $105:    106
 PUT $110:  3,279, CALL $110:    402
 PUT $115:  1,417, CALL $115:     74
 PUT $120: 14,317, CALL $120:     57
 PUT $125:  1,799, CALL $125:    380
 PUT $130:  2,465, CALL $130:     56
 PUT $135:    289, CALL $135:     21
 PUT $140:  1,963, CALL $140:     23
 PUT $145:    959, CALL $145:     24
 PUT $150: 17,223, CALL $150:    890
 PUT $155:  1,104, CALL $155:     25
 PUT $160:  1,872, CALL $160:    238
 PUT $165:  2,260, CALL $165:      4
 PUT $170:  5,108, CALL $170:    638
 PUT $175:  3,272, CALL $175:     92
 PUT $180:  3,245, CALL $180:    523
 PUT $185:    938, CALL $185:    391
 PUT $190:  2,084, CALL $190:  1,967
 PUT $195:  1,982, CALL $195:    370
 PUT $200: 33,661, CALL $200:  2,584
 PUT $210:  6,128, CALL $210:  1,246
 PUT $220:  8,631, CALL $220:    985
 PUT $230: 12,446, CALL $230:  1,830
 PUT $240:  9,261, CALL $240:  1,584
 PUT $250: 11,835, CALL $250:  2,432
 PUT $260:  6,018, CALL $260:  1,675
 PUT $270:  8,160, CALL $270:  2,452
 PUT $280:  9,234, CALL $280:  2,377
 PUT $290:  4,494, CALL $290:  3,203
 PUT $300: 11,123, CALL $300: 12,116
 PUT $310:  4,198, CALL $310:  3,916
 PUT $320:      0, CALL $320:      0
 PUT $320:  3,662, CALL $320:  3,678
 PUT $330:  5,680, CALL $330:  6,822
 PUT $340:      0, CALL $340:      0
 PUT $340:  5,062, CALL $340:  6,576
 PUT $350:      0, CALL $350:      0
 PUT $350: 10,037, CALL $350: 14,573
 PUT $360:      0, CALL $360:      0
 PUT $360:  3,324, CALL $360:  9,788
 PUT $365:    923, CALL $365:  1,599
 PUT $370:  1,671, CALL $370:  3,307
 PUT $375:  1,144, CALL $375:  2,728
 PUT $380:    688, CALL $380:  4,354
 PUT $385:    575, CALL $385:    917
 PUT $390:    408, CALL $390:  3,622
 PUT $395:    201, CALL $395:  1,299
 PUT $400:  3,030, CALL $400: 14,777
 PUT $405:    167, CALL $405:    950
 PUT $410:    998, CALL $410:  2,657
 PUT $415:    243, CALL $415:    859
 PUT $420:  1,109, CALL $420:  7,098
 PUT $430:    649, CALL $430:  2,937
 PUT $440:    911, CALL $440:  2,766
 PUT $450:  1,166, CALL $450:  7,207
 PUT $460:    373, CALL $460:  1,488
 PUT $470:    475, CALL $470:  1,874
 PUT $480:    424, CALL $480:  2,736
 PUT $490:    197, CALL $490:  1,493
 PUT $500:  3,147, CALL $500: 12,733
 PUT $510:     21, CALL $510:    574
 PUT $520:     10, CALL $520:  1,355
 PUT $530:      0, CALL $530:    598
 PUT $540:     13, CALL $540:    465
 PUT $550:    463, CALL $550:  3,337
 PUT $560:      0, CALL $560:  1,169
 PUT $570:      0, CALL $570:    311
 PUT $580:     51, CALL $580:  1,966
 PUT $590:      7, CALL $590:    826
 PUT $600:    339, CALL $600: 26,120
 PUT $610:      3, CALL $610:    587
 PUT $620:      1, CALL $620:    715
 PUT $630:      0, CALL $630:    383
 PUT $640:      0, CALL $640:    488
 PUT $650:      5, CALL $650:  3,080
 PUT $660:     22, CALL $660:    553
 PUT $670:      0, CALL $670:    818
 PUT $680:      2, CALL $680: 11,140

Very obvious overlap in short and long expectations, no easy equilibrium price visible at all. Volatility secured! ;)

Random observations:
  • The total PUT interest is 477K contracts, which is 47.7 million shares-equivalent (!) - this has risen by 20% in the last 1.5 months alone ...
  • There's a $100m short PUT bet of ~300k shares-equivalent with a strike price of $500 (!!) - that's going to hurt big time if TSLA makes any big jump in valuation before January 18 ...
  • There's a similar ~$100m PUT bet at $400 strike price as well.
  • There's also ~$330m worth of PUT pain at $300 and ~$350m worth of PUT pain at $350 strike prices
  • It's all heavily biased to the short side: the PUT/CALL ratio is 2.1x, so the market-maker inventory hedging flow will be substantial IMO.
Of course all of that is only an upside for your position if case the bankwuptcy PUT bets do not materialize :))), and if there are no global economic catastrophes.
 
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BTW., also note that the 2019 January 18 PUT options open interest is insanely high, it represents over 80% of all 2019 options at the moment:
Code:
2018/Nov/23:  PUTs:     2,034 ; CALLs:     3,471
2018/Nov/30:  PUTs:       943 ; CALLs:       862
2018/Dec/21:  PUTs:    97,132 ; CALLs:    62,382
2019/Jan/18:  PUTs:   477,119 ; CALLs:   224,213
2019/Feb/15:  PUTs:     9,168 ; CALLs:    15,057
2019/Mar/15:  PUTs:    77,956 ; CALLs:    40,668
2019/Jun/21:  PUTs:    69,954 ; CALLs:    43,403
2019/Aug/16:  PUTs:    20,879 ; CALLs:    12,620

This means that the moment the 2019/Jan/18 options expire, a lot of TSLA short inventory held by market makers might be freed up - i.e. TSLA might be bought and even of the 2019/Jan expiry closing price will be plaid to force maximum pain, the next expiries won't be nearly as constrained and the stock price might catch up to real valuation and expectations ...

The Feb/15 expiry will also include the pricing of the Q4 earnings report.

Just for kicks, here's the open interest straddle table of the January expiries:
Code:
 PUT $  3:    297, CALL $  3:      2
 PUT $  5:     36, CALL $  5:      0
 PUT $  8:     10, CALL $  8:      0
 PUT $ 10: 35,186, CALL $ 10:      2
 PUT $ 10:     84, CALL $ 10:    112
 PUT $ 13:     30, CALL $ 13:     35
 PUT $ 15:  2,090, CALL $ 15:      1
 PUT $ 15:  2,238, CALL $ 15:     28
 PUT $ 17:     90, CALL $ 17:     55
 PUT $ 20: 19,572, CALL $ 20:      3
 PUT $ 20:     55, CALL $ 20:    395
 PUT $ 22:     10, CALL $ 22:    347
 PUT $ 25: 10,989, CALL $ 25:      0
 PUT $ 25:    127, CALL $ 25:    282
 PUT $ 27:     24, CALL $ 27:  1,239
 PUT $ 30:  2,398, CALL $ 30:      0
 PUT $ 30:     21, CALL $ 30:    563
 PUT $ 35:  3,437, CALL $ 35:      0
 PUT $ 35:     24, CALL $ 35:    275
 PUT $ 40:  2,276, CALL $ 40:     10
 PUT $ 40:     31, CALL $ 40:    163
 PUT $ 45:  2,997, CALL $ 45:      7
 PUT $ 50: 75,540, CALL $ 50:      8
 PUT $ 55:  3,579, CALL $ 55:      3
 PUT $ 60:  2,500, CALL $ 60:      0
 PUT $ 65:    825, CALL $ 65:      1
 PUT $ 70:  6,496, CALL $ 70:      7
 PUT $ 75:  8,014, CALL $ 75:    209
 PUT $ 80:  4,550, CALL $ 80:    160
 PUT $ 85:    759, CALL $ 85:    319
 PUT $ 90:  3,145, CALL $ 90:    326
 PUT $ 95:  2,257, CALL $ 95:    219
 PUT $100: 48,048, CALL $100:  3,438
 PUT $105:  1,418, CALL $105:    106
 PUT $110:  3,279, CALL $110:    402
 PUT $115:  1,417, CALL $115:     74
 PUT $120: 14,317, CALL $120:     57
 PUT $125:  1,799, CALL $125:    380
 PUT $130:  2,465, CALL $130:     56
 PUT $135:    289, CALL $135:     21
 PUT $140:  1,963, CALL $140:     23
 PUT $145:    959, CALL $145:     24
 PUT $150: 17,223, CALL $150:    890
 PUT $155:  1,104, CALL $155:     25
 PUT $160:  1,872, CALL $160:    238
 PUT $165:  2,260, CALL $165:      4
 PUT $170:  5,108, CALL $170:    638
 PUT $175:  3,272, CALL $175:     92
 PUT $180:  3,245, CALL $180:    523
 PUT $185:    938, CALL $185:    391
 PUT $190:  2,084, CALL $190:  1,967
 PUT $195:  1,982, CALL $195:    370
 PUT $200: 33,661, CALL $200:  2,584
 PUT $210:  6,128, CALL $210:  1,246
 PUT $220:  8,631, CALL $220:    985
 PUT $230: 12,446, CALL $230:  1,830
 PUT $240:  9,261, CALL $240:  1,584
 PUT $250: 11,835, CALL $250:  2,432
 PUT $260:  6,018, CALL $260:  1,675
 PUT $270:  8,160, CALL $270:  2,452
 PUT $280:  9,234, CALL $280:  2,377
 PUT $290:  4,494, CALL $290:  3,203
 PUT $300: 11,123, CALL $300: 12,116
 PUT $310:  4,198, CALL $310:  3,916
 PUT $320:      0, CALL $320:      0
 PUT $320:  3,662, CALL $320:  3,678
 PUT $330:  5,680, CALL $330:  6,822
 PUT $340:      0, CALL $340:      0
 PUT $340:  5,062, CALL $340:  6,576
 PUT $350:      0, CALL $350:      0
 PUT $350: 10,037, CALL $350: 14,573
 PUT $360:      0, CALL $360:      0
 PUT $360:  3,324, CALL $360:  9,788
 PUT $365:    923, CALL $365:  1,599
 PUT $370:  1,671, CALL $370:  3,307
 PUT $375:  1,144, CALL $375:  2,728
 PUT $380:    688, CALL $380:  4,354
 PUT $385:    575, CALL $385:    917
 PUT $390:    408, CALL $390:  3,622
 PUT $395:    201, CALL $395:  1,299
 PUT $400:  3,030, CALL $400: 14,777
 PUT $405:    167, CALL $405:    950
 PUT $410:    998, CALL $410:  2,657
 PUT $415:    243, CALL $415:    859
 PUT $420:  1,109, CALL $420:  7,098
 PUT $430:    649, CALL $430:  2,937
 PUT $440:    911, CALL $440:  2,766
 PUT $450:  1,166, CALL $450:  7,207
 PUT $460:    373, CALL $460:  1,488
 PUT $470:    475, CALL $470:  1,874
 PUT $480:    424, CALL $480:  2,736
 PUT $490:    197, CALL $490:  1,493
 PUT $500:  3,147, CALL $500: 12,733
 PUT $510:     21, CALL $510:    574
 PUT $520:     10, CALL $520:  1,355
 PUT $530:      0, CALL $530:    598
 PUT $540:     13, CALL $540:    465
 PUT $550:    463, CALL $550:  3,337
 PUT $560:      0, CALL $560:  1,169
 PUT $570:      0, CALL $570:    311
 PUT $580:     51, CALL $580:  1,966
 PUT $590:      7, CALL $590:    826
 PUT $600:    339, CALL $600: 26,120
 PUT $610:      3, CALL $610:    587
 PUT $620:      1, CALL $620:    715
 PUT $630:      0, CALL $630:    383
 PUT $640:      0, CALL $640:    488
 PUT $650:      5, CALL $650:  3,080
 PUT $660:     22, CALL $660:    553
 PUT $670:      0, CALL $670:    818
 PUT $680:      2, CALL $680: 11,140

Very obvious overlap in short and long expectations, no easy equilibrium price visible at all. Volatility secured! ;)

Random observations:
  • The total PUT interest is 477K contracts, which is 47.7 million shares-equivalent (!) - this has risen by 20% in the last 1.5 months alone ...
  • There's a $100m short PUT bet of ~300k shares-equivalent with a strike price of $500 (!!) - that's going to hurt big time if TSLA makes any big jump in valuation before January 18 ...
  • There's a similar ~$100m PUT bet at $400 strike price as well.
  • There's also ~$330m worth of PUT pain at $300 and ~$350m worth of PUT pain at $350 strike prices
  • It's all heavily biased to the short side: the PUT/CALL ratio is 2.1x, so the market-maker inventory hedging flow will be substantial IMO.
Of course all of that is only an upside for your position if case the bankwuptcy PUT bets do not materialize :))), and if there are no global economic catastrophes.
More than 10% of all call contracts for Jan18 are the 600s, over 26,000 wowza.
 
(I just finally got caught up on this thread so I feel it's time to finally post my 'Market Action' related comment I made earlier.)

Folks, I'm about to buy my smorgasbord of options so Fair Warning about the likely and immediate decline in the stock. Prepare yourself.
Before or after you see the lemur?
 
Ever since Elon's been talking about Iain M. Banks' Culture series, the prices have gone through the roof on Amazon. Thanks, Elon. :)

So Elon only ever talks about the (fantastic!) books of Ian M. Banks positively, and their price went up significantly.

Maybe there's a life lesson there which Elon could apply to the TSLA stock price, somehow? ;)
 
I already pulled the lever mid-afternoon during the ascent. Whatever that dastardly looking lemur has planned is now in Elon's hands. So I am predicting per past financial model I provided 620 in ~8 months. Of course when I pull up the 5 year chart that looks like a ridiculously dumb thing to do but then Tesla doesn't typically pull off 75% Q/Q revenue jumps so precisely the unexpected nature of it is part of the leverage.

Speaking of which, Fact Checking, you seem like the sort of detail-oriented fellow that would follow up on such a thing. I'd be curious for you to review your post here about the impact of January Put expiration.. I am generally of the opinion that attempting to use technical\mechanical things like that are hopeless but wouldn't mind being proven wrong (if this wasn't in actuality the general discussion thread in covert disguise I wouldn't read it). I generally feel like people referencing things like Max Pain never bother to notice it never works.

I can tell you guys, because I have an absurd ability to measure the pulse of this particular stock, that the fact that Netflix didn't hit 400 today on THOSE results means the market sentiment is not looking good here. Perhaps it is as simple as worry about the other FANGS though.

Also I want to say that Shanghai coming in as #8 most worrisome city for natural disasters is still insufficient for me to truly judge the risk level when all factors are considered so I have to stick with my prior expectation that proper precautions will be taken. These things are known unknowns at least. That latent quake off of Oregon is more concerning because nothing was built with the awareness it existed. Anyway, it will take a couple years to matter and China is ~20% of their market. Maybe they won't use tents though.

Also while I am sympathetic to VA's concern about Elon oversight I also agree that this particular 20M$ buyback is not the hill to die on just based on scale if nothing else. Clearly 'the principle of it' wouldn't matter if it was 1 share?
 
More than 10% of all call contracts for Jan18 are the 600s, over 26,000 wowza.

There were probably bought on the cheap for ~$10 per contract (~$0.10 per share-equivalent), total value ~$250k, either as "brutal short squeeze" lottery tickets, or it's owned by some of the few shorts who are hedging their exposure with call options (most don't).

Likewise the really low strike price ($50-$100) PUT options were cheap as well. Most everything else in the $200-$400 range, which is about 40% of the open interest, is probably going to hurt (or bring joy) more.
 
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