TSLA Market Action: 2018 Investor Roundtable

[Ulmo]

Maybe because, it destroys OTM calls? Not every investor is in 100% shares.

Then they don’t own as many shares to vote no with.

 

[Anstandswauwau]

So that is a nice illustration of the rate at which the time value of long-date contracts is deflating. The more the market believes this deal is happening, the faster the time value will drop. OTM options are pure time value, so they are a hot potato.

To clarify: My position currently sits at -80%.

So your advice is to jump ship ASAP anyway?

Or do you think there's a slim chance for a turn-around (squeeze and/or if the $420-deal doesn't go through)?

Thanks

 

[The Blue Owl]

To clarify: My position currently sits at -80%.

So your advice is to jump ship ASAP anyway?

Or do you think there's a slim chance for a turn-around (squeeze and/or if the $420-deal doesn't go through)?

Thanks

I don't want to give any advice... All I can say is that I exited all my LEAPS right after Musk uttered the words "taking Tesla private" and bought shares with the proceeds.

 

[tivoboy]

So as a public company, the worth of my investment is based upon what someone else is willing to pay for the stock. This is (in theory) driven by future expectations of growth.

If I choose to stay with Tesla when they go private, how is the value of my investment determined?

They will almost ALWAYS need capital. New models, new factories, new initiatives, etc.. to get that capital someone is going to put a value on the company/equity/debt come up with a relative enterprise value. Then come up with a number of shareholders equity, divide by shares - that is the price to pay (higher or lower) to put in new $$..plus a premium. If you want OUT at that number, there will be an opportunity. Or if you want IN at that $$, there is that too..

It won't be as clear as it has been in the public markets though, it never is. And disclosures are significantly different.

IF this goes through, I think there will be many institutional holders that will cash out a significant % of their holdings. that is just prudent financial management FOR THEM.

There will be new money coming in, sadly probably at this point based on non-market available information or strategy.

And there will be SOME retail remaining as shareholders, but IMHO most of the current retail will exit. Either at the conversion price or shortly after at whatever the next window is.

Technically at this point RETAIL doesn't hold much of the company at all, but retail is participating a LOT on a daily basis. That's why I think the current retail owner will exit - and frankly, it's better for the company.

 

[SebastianR]

Depends how the deal is structured. It's legal to own shares in private equity in foreign countries.

Perhaps one move is to get your stock actually issued into your name on the books of the company -- demand a certificate. (Can't do that if it's a retirement account or anything similar, of course.) This may involve some serious paperwork.

This will be a pain

All my shares are held in the EU. And I doubt I can keep them if Tesla goes private - heck I wasn't even able to vote on Solar City (or any other shareholder vote for that matter).

So it seems I will need to cash out - which is going to be a royal pain from a tax perspective. And of course a pity from a long-term perspective. Small hope I have is, that stock price is going to rally really high so that there is not enough money left to take the company private. But which bone-headed shorts I doubt it...

 

[TradingInvest]

Imagine in the future, any company who wants to get a significant size of Testa, they will have to go to the private liquidity events - twice a year. Without all the down side manipulation, this will likely result to a higher price in those private events.

 

[Johan]

This will be a pain

All my shares are held in the EU. And I doubt I can keep them if Tesla goes private - heck I wasn't even able to vote on Solar City (or any other shareholder vote for that matter).

So it seems I will need to cash out - which is going to be a royal pain from a tax perspective. And of course a pity from a long-term perspective. Small hope I have is, that stock price is going to rally really high so that there is not enough money left to take the company private. But which bone-headed shorts I doubt it...

In a similar position here. Just fired off an e-mail to by bank to ask if there are solutions to this.

 

[EVGhost3]

Is it fair to say- until privatization is done (whether it happens or not), it’s a good idea to keep buying the stocks for those who have capacity?

 

[Mike Ambler]

RE: short burn call.
I'm a lurker, rank investing amateur, but have my fist full of shares that won't be sold any time soon. I've been reading everyone's ideas on what might cause the burn and like most cannot see a sure thing (ignoring obvious and impossibles like 10k a week, we only did half that LOL). What about an announcement by a mega player making a buy out offer (fake or not) to take TESLA private, at say $500 a share. Doesn't that basically put the share price at 500 overnight and send the shorts out of business?
Back under the rock for me

what to do with last little dry powder ??

 

[Boomer19]

Yeah, I'm already recalling in order to vote. Whether yes or no, I have a strong incentive to vote this!

as am i

mainly because, even if the effective date of this offer is somewhere off in the distant future, that doesn’t mean the record date won’t be in the near future. i don’t really know how, for this type of offer, a record date is derived. sometimes they are as of a past date (i hope not case here).

 

[TradingInvest]

They will almost ALWAYS need capital. New models, new factories, new initiatives, etc.. to get that capital someone is going to put a value on the company/equity/debt come up with a relative enterprise value. Then come up with a number of shareholders equity, divide by shares - that is the price to pay (higher or lower) to put in new $$..plus a premium. If you want OUT at that number, there will be an opportunity. Or if you want IN at that $$, there is that too..

It won't be as clear as it has been in the public markets though, it never is. And disclosures are significantly different.

IF this goes through, I think there will be many institutional holders that will cash out a significant % of their holdings. that is just prudent financial management FOR THEM.

There will be new money coming in, sadly probably at this point based on non-market available information or strategy.

And there will be SOME retail remaining as shareholders, but IMHO most of the current retail will exit. Either at the conversion price or shortly after at whatever the next window is.

Technically at this point RETAIL doesn't hold much of the company at all, but retail is participating a LOT on a daily basis. That's why I think the current retail owner will exit - and frankly, it's better for the company.

You said "They will almost ALWAYS need capital". I don't agree. I see Tesla to use internally generated cash for future growth. Or they could use the Gigafactory 3 model.

 

[Dan Detweiler]

I think we are in unchartered water here. Apparently shorts are not yet covering. It appears that most longs underestimated how delusional the shorts are. Most of them still firmly believe Elon is lying. We will probably see true short squeeze of the century

...which would drive the price significantly higher, right? Potentially over the $420 level? Then what?

Dan

 

[1208]

Someone mentioned investment from Saudi Arabia.

Prince Khaled bin Alwaleed of Saudi Arabia is vegan, his one car is a

Tesla Model X P90D, he is promoting sustainability, wants to sort out climate change and is interested in technology.​

Meet the vegan Saudi prince who's turning the lights on in Jordan

https://www.peta.org/blog/saudi-prince-mission-veganize-middle-east/

 

[Orbit]

This will be a pain
All my shares are held in the EU.

Maybe you can open an account with a US broker and transfer them over.

 

[MXWing]

Someone mentioned investment from Saudi Arabia.

Prince Khaled bin Alwaleed of Saudi Arabia is vegan, his one car is a

Tesla Model X P90D, he is promoting sustainability, wants to sort out climate change and is interested in technology.​

Meet the vegan Saudi prince who's turning the lights on in Jordan

Saudi Prince on a Mission to Veganize the Middle East | PETA

Lets make sure we dont lose 2 billion in funding once he finds out there is leather in the gear shifter.

 

[ggr]

have a short covered call @300 8/17, anyone have any idea whats going to happen to this? should i (assuming i believe the price will rise) close out ASAP?

Ayup.

 

[BenPrice]

Someone mentioned investment from Saudi Arabia.

Prince Khaled bin Alwaleed of Saudi Arabia is vegan, his one car is a

Tesla Model X P90D, he is promoting sustainability, wants to sort out climate change and is interested in technology.​

Meet the vegan Saudi prince who's turning the lights on in Jordan

Saudi Prince on a Mission to Veganize the Middle East | PETA

Wouldn’t it be funny if one of the beneficiaries of so much oil wealth is the private funding to accelerate it’s demise.

 

[pz1975]

I don't want to give any advice... All I can say is that I exited all my LEAPS right after Musk uttered the words "taking Tesla private" and bought shares with the proceeds.

Exactly what I did too. I kept LEAPS (ITM) in which the strike price + value was <$420 since they could still go up to that level. I’m afraid for people who held their OTM calls/LEAPs. Maybe they didn’t understand options enough in the first place.

 

[oneday]

Add to that that you probably won't get ANYWHERE near the amount of information out of the company that you once did, to put a value on your shares/risk.

I actually disagree with this. Elon is a pretty transparent guy. I actually think SEC rules restrict the amount of information that he can disseminate regarding Tesla. I think we will get more information regarding Tesla progress once they are private. We will have less financial information and such. But I think profits and growth will continue to be executed on.

 

[wipster]

You said "They will almost ALWAYS need capital". I don't agree. I see Tesla to use internally generated cash for future growth. Or they could use the Gigafactory 3 model.

I foresee that much of the future growth will be in tents...

(Sorry for that ;-))