TSLA Market Action: 2018 Investor Roundtable

[winfield100]

So, who is going to be buying more tomorrow. Longs that want to get in below $420 so they can get private shares or shorts that want to get out before $420 or above. lots of buying pressure but where is the selling pressure?........Interesting times.

I need 7 more shares to have a round lot number.

 

[TrendTrader007]

I agree anything below 420s in calls is a real long shot and all calls are dangerous
However I suspect a short squeeze if it ever happens will happen very very soon
Maybe over the next 25 trading days
Super excited

 

[TSLAopt]

We don't know. Someone mentioned that it's possible to hold private equity in a Roth IRA (and I believe this is correct), but *you may need to get a new IRA custodian*. I didn't want to start researching this but I will have to do so tomorrow.

I'm hoping Musk will help us all out and give us a list of companies which will act as IRA custodians for private-equity shares.

But he probably won't, so I hope one of the extremely kind people on this forum who knows a great deal about the subject will suggest some companies which will act as IRA custodians for private-equity shares.

Entrust and Millennium are a couple well known self-directed IRA custodians that may help

 

[Jayjs20]

If your thesis was that Tesla would be a high growth company publicly it should not change because it is going private. The biggest change will be you won't be able to use any option strategy and you will have limited liquidity.

Both of those may make investing elsewhere something to consider. Not advice. I will probably stay with 'private Tesla' as I could use a little less CNBC/short drama/volatility.

Like EM said: Don't invest in (public) TSLA if you can't stand volatility.......Private.....less volatile

Not advice

Oh contraire. I like the volatility. The volatility is what makes this stock so profitable. The stock reliably jumps between the upper and lower BB 4-6 times a year, and I've only begun to use that to my advantage. I'd never short it, but I do wait for the SP to pull back a bit before buying back in.

I don't know, it feels like some doors were slammed shut in my face today due to being unable to play with the volatility anymore. I need to find a way to return investing to something that's more than just the way I keep myself alive when I'm 70.

 

[neroden]

BTW., a short squeeze might trigger even if the deal does not go through:

Actually, I'm 100% sure a short squeeze is happening, for the reasons you say and the reasons Gene Munster says. The only question is *where* the price will stabilize after the fact.

the pure act of a contentious shareholder vote would cause many shares to be recalled, a few weeks before the vote, creating both forced covering of shorts due to the recall and also a steady increase in the share price and lack of pressure from shorts, which would further squeeze shorts.

For example at the end of today's trading day there were no shares available for shorting anymore.

I agree with Munster: 1/3 chance that the deal goes through at 420, though I give it a higher-than-50% chance that it goes through at some price (420 or higher). Tender offers are a funny business: I remember some where the offerer made an offer, swept out some stockholders, then raised the offer and swept out more, and then raised the offer again and swept them out more. The ones who sold out on the first offer were sore.

 

[KCapital]

I’m doing good
I had about 897 calls out of which over 500 calls were OTM
I sold every single call about 30 minuets before the stock was halted and then bought about 370 DITM calls at 1259 hrs CST exactly 6 minutes before the stock was halted
I took losses of about I dunno a million or so and left about 2.5 million unrealized gains on the table
Then I bought another 10 DITM calls exactly 1.5 minutes before market close
Now all my calls are below 415 strike price J19s and I’m carrying over 422 calls DITM
I got a feeling I’m about to recoup all my losses and make a serious killing over the next 3 to 7 weeks
Maybe sooner
We will see
Easy come easy go

Very nice!!

My first reaction was the excitement of my own portfolio growth and then immediately the thought of you being in soup. Glad you are doing good.

I will sleep just fine tonight.

 

[mongo]

That's where value over $420 comes in, outside of covering action.

If you want into the new private epoch.

Then, profit-taking and rebuying on the back side of a short squeeze may make sense, as is expanding or initiating a long position for over $420 - otherwise, buying, especially if you're not an accredited investor, may well be impossible.

Given the price is currently below 420, how much acquisition will occur above that price? Guess that is the fee for being late to the game...

 

[neroden]

how soon do you anticipate this could happen in this case?

I don't know for certain, but every time I've watched options during a merger or buyout deal, the spreads have blown out as soon as the merger was announced; the pricing slowly regrouped to be based around the merger offer price and probability of merger vs. higher bid vs. fall through; and the liquidity just slowly dried up.

 

[AudubonB]

I hope his promise to let us small fish stay in when he goes private is able to stand. I'm not an accredited investor. I'm not supposed to be allowed to own private equity. My intent is to allow all of my shares to convert, so let's see what happens.

For me, this isn't the beginning of the end. It's the end of the beginning. Sure would be nice if all of us retail minnows can keep swimming with the whales in the private ocean.

The following is PURE SPECULATION

Mr Musk’s letter mentioned the company is attempting to establish a fund so that extant investors who wish to retain their holdings will be able to do so.

My immediate supposition is that it may be structured so that non-accredited investors CAN hold positions in the fund. The fund, of course, will have exactly one entity within its portfolio*


*(or maybe also, eventually, TEnergy or Starlink or BoringCo or.....?????.....)

 

[jhm]

But won't the dynamics change greatly due to the 420 conversion price? No trader would want to purchase above that price, seems like it would only be covering action.
Sell to shorts above 420, Tesla at 420, or join the new private epoch.

I'm not so concerned about what traders do. They certainly will not want in on the private shares.

But for investors, consider this your last call to own Tesla for the next ten years or more. If Tesla stock were not getting constantly abused by shorts and other traders, what do you think it would be worth. In BFPT we have three longterm targets for 2028, Nominal $3250, Sport $5250, and Insane $7250. Suppose you believe that without impedance by shorts Insane is a fair bet. What would you be willing to pay today for the Insane $7250 in 2028. At a 30% discount, $525 is a good price. At 25% discount, $778 is a fair price. Or at 20%, $1171. The thing is, we've been so beaten down in this market that the best strategy has been to accumulate whenever the stock is beaten down. But going private means we're going to need put a serious value on the longterm opportunity before Tesla. We get one last good chance to get into this private fund. So what's it worth? A mere $420? What would you reinvest that $420 in that would be just as good as a private share in Tesla?

 

[dc_h]

A different extract from the first line of the article:

In other words, they weren't going to let themselves be named so that they can't be held responsible.

A bunch of brokers who are personally short Tesla and hate Elon musk said he can’t do this, and besides falcon wing doors can’t be built and rockets don’t land, so we still got this.

 

[Boomer19]

I agree anything below 420s in calls is a real long shot and all calls are dangerous
However I suspect a short squeeze if it ever happens will happen very very soon
Maybe over the next 25 trading days
Super excited

you mean calls above 420 are a long shot, right?

 

[TradingInvest]

So, who is going to be buying more tomorrow. Longs that want to get in below $420 so they can get private shares or shorts that want to get out before $420 or above. lots of buying pressure but where is the selling pressure?........Interesting times.

Anyone properly digested the news wouldn't sell, they should be buying. Those shorts who feel relieved that they can finally get over with this pain, because they can cover millions of shares at $420, clearly don't understand the situation. I am more and more concerned where they can find the shares. Those longs who want to stay in the private Tesla (which will be majority of shareholders) will not sell at any price near $420. I would be a buyer not a seller. Still transferring more cash to my accounts. Hopefully the stock will not reach $420 too fast.

I wouldn't use high margin because I don't want to get screwed if whatever goes wrong. I want to make sure I get the Tesla gain. This is at least a 400 bagger from IPO to maturity.

 

[neroden]

This is a good point. If the offer is one share of TSLAP or 420, and the shares are at 750, no one will take 420. Does he have to raise the bid, or can he just offer the pt=riveted stock alternative? If this happens, where does the 15 billion short money go? Somebody has to win, is it the big investors, the market, makers?

The huge wild card is who will be permitted to continue to hold the stock when it goes private. I know Musk is saying he's going to try to allow *all* stockholders to do so... but I just know that's not possible. It's the people who would be *forced* to sell when it goes private (foreigners, people with retirement accounts of the wrong type, funds with charter limitations on private equity holdings) who would have standing to sue. (Maybe he'll find a good solution for US holders and IRAs, but will he find one for Estonian retirement accounts? You get my point.)

So the way they can sue is rather interesting: they can sue to force Tesla to keep the stock public and listed. This is something they can actually force the company to do, if the courts agree! (I'm not remembering a specific precedent here, but there *was* one, I have hazy memories of this.)

The private investors can still make their $420 tender offer and buy out shares from anyone who chooses to sell, but they would be forced to leave the company as a public listed company.

Now, generally the way around this -- the way to defeat the suit to keep the company listed -- is to make sure that the buyout offer is well over the listed trading price, since then the courts won't find any damages from the delisting. That's why I'd expect, if the stock trades well over $420, that the offer will be raised.

 

[ZachShahan]

I do get this part but the fact that he promised profitability in Q3 onwards which is in merely 3 months time would fight the trolls as well, even in more convincing terms than the buyout. I just do not see why he couldn’t wait 3 more months of volatility and shut the shorts for good with a massive earnings beat. Why such a hurry unless he cannot deliver.

Because the shorts won't go away, the smearing won't stop (read that article to understand why), and the FUD will continue to be a problem. It also won't go away 100% as a private company, but much of it will — or at least won't get the press it has been getting.

 

[ZsoZso]

I've been an investor in private companies (all complete losses or terrible experiences, sorry to say -- no positive experiences to report). The really small ones keep track of their investors themselves...

Well, we have different experiences.
I've been an investor in a really small private company and it worked out extremely well
It was not a 10 bagger, but more like a 10^5 bagger. (mind you, it was a long investment, 21-year payout)

 

[neroden]

But for investors, consider this your last call to own Tesla for the next ten years or more. If Tesla stock were not getting constantly abused by shorts and other traders, what do you think it would be worth. In BFPT we have three longterm targets for 2028, Nominal $3250, Sport $5250, and Insane $7250. Suppose you believe that without impedance by shorts Insane is a fair bet. What would you be willing to pay today for the Insane $7250 in 2028. At a 30% discount, $525 is a good price. At 25% discount, $778 is a fair price. Or at 20%, $1171. The thing is, we've been so beaten down in this market that the best strategy has been to accumulate whenever the stock is beaten down. But going private means we're going to need put a serious value on the longterm opportunity before Tesla. We get one last good chance to get into this private fund. So what's it worth? A mere $420? What would you reinvest that $420 in that would be just as good as a private share in Tesla?

Sadly, it doesn't matter; I might need the money before 2028 and I don't trust the liquidity events. I'll have to sell part of my stake if the liquidity drops. I'll keep what I can while preserving my liquidity, though.

 

[TrendTrader007]

Very nice!!

My first reaction was the excitement of my own portfolio growth and then immediately the thought of you being in soup. Glad you are doing good.

I will sleep just fine tonight.

Thanks ! I really appreciate it
I think there is lots of money to be made being long tsla over next several days to weeks
$420 dry well may end up being the final price but before this is all over I bet my last dollar SP will likely temporarily spike much higher
I will post daily here and on Twitter especially when I sell everything
And sell everything I will
The way this stock is acting this thing is about to go crazy
Of course it would be senseless to bet on any call over 420 but anything below 415 will make tons of money
I can’t wait to reclaim all my lost millions from shorts over the next several days to weeks

 

[LytHka]

The following is PURE SPECULATION

Mr Musk’s letter mentioned the company is attempting to establish a fund so that extant investors who wish to retain their holdings will be able to do so.

My immediate supposition is that it may be structured so that non-accredited investors CAN hold positions in the fund. The fund, of course, will have exactly one entity within its portfolio*


*(or maybe also, eventually, TEnergy or Starlink or BoringCo or.....?????.....)

Could be the beginning of an umbrella corporation. He has enough companies...

Tesla Motors
Tesla Energy
SpaceX
The Boring Company

Future assets:
Hyperloop
Neuralink
Starlink

 

[CaptainKirk]

I have a question in to TDCT Waterhouse asking if RRSP/TFSA can just transfer shares within or have to liquidate outside the registered account.

Please let us know what answer you get. I’m fairly certain that TFSAs and RRSPs can not hold private equity, based on a brief scan on the CRA site while on lunch.