mickificki
Member
Did someone say monkeys?
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Following the TA discussion, it crossed my mind that opinions on observable trends with TSLA price action might be beneficial for this thread. @Papafox has made some great contributions, especially with observations on action around bollinger band limits.
I often read about amateur hour, and power hour observations. Having followed the stock for a couple years now, i would submit that it is amateur 15 mins in the morning, and that regardless of what trend TSLA is in, shorts will try to supress price at the open.
Regarding power hour, if TSLA is in a general uptrend, it is actually power 3.45-4.00, whereby if price has been consolidating up to this point, the increased volume typically observed from 3.45 onwards precipitates a spike.
I often read about amateur hour, and power hour observations. Having followed the stock for a couple years now, i would submit that it is amateur 15 mins in the morning, and that regardless of what trend TSLA is in, shorts will try to supress price at the open.
Regarding power hour, if TSLA is in a general uptrend, it is actually power 3.45-4.00, whereby if price has been consolidating up to this point, the increased volume typically observed from 3.45 onwards precipitates a spike.
My point exactly. Under the hood, nothing special, but damn if people didn't get swept up by the marketing.
An exclusive look at Tesla’s plan to build largest EV charging station in the world with 40 Superchargers wow, that is going to be a game changer for that area, and also shows how serious tesla is about developing their infrastructure. If I were short I would be scared, this is like being short apple when the iphone came out. Except I don't think we will see the decline for a year that apple saw because the technology is already proven out since 2012 and only now the cost is right too 
As far as they are concerned, this is all just capex that diminishes free cash flow. They welcome this.
MitchJi
Trying to learn kindness, patience & forgiveness
It's not a mystery. One contract is for 100 shares. The current delta is 0.73458 so the total increase is ~$73.46 dollars per option for every $1.00 that the SP goes up. In other words about the same total dollar increase as 73 or 74 shares:
Delta. The ratio of the change in price of an option to the change in price of the underlying asset. Also called the hedge ratio. Applies to derivative products. For a call option on a stock, a delta of 0.50 [0.73458] means that for every $1.00 that the stock goes up, the option price rises by $0.50 [$0.73458] per share.
By the way, $327 is my buy and hold break even (average purchase price).
[Had to add a lot more shares to give Tesla the best chance to perform.]
So as of today, I am a little ahead.
Need $384 by May 2018 to close the deal on the Model 3 (RWD). Seems reasonable goal, not some "Oh, you did not meet it! So sad." Excuse goal. In other words, totally serious about making appreciation of Tesla stock be a successful way to pay for the car.
Retirement savings resume after that.
Thank you to all the people who participate here. Am learning from each and every one.
The Cramer video confirmed that, yes, each time I trade I am a rabbit in a land where the sky is filled with hawks. If you use stop losses, you are letting some stupid, trick-able robot look after your money. Cramer clones will trick that robot and take your money. Don't let robots hold your money! (Maybe an advice, more an admonition. No, no, not an admonition...)
If you buy and hold the old fashion way, the truth should win out:
Tesla is a set of people doing the best work of their lives to make the world a better place. Perfect? No. Best effort? Yes.
[Had to add a lot more shares to give Tesla the best chance to perform.]
So as of today, I am a little ahead.
Need $384 by May 2018 to close the deal on the Model 3 (RWD). Seems reasonable goal, not some "Oh, you did not meet it! So sad." Excuse goal. In other words, totally serious about making appreciation of Tesla stock be a successful way to pay for the car.
Retirement savings resume after that.
Thank you to all the people who participate here. Am learning from each and every one.
The Cramer video confirmed that, yes, each time I trade I am a rabbit in a land where the sky is filled with hawks. If you use stop losses, you are letting some stupid, trick-able robot look after your money. Cramer clones will trick that robot and take your money. Don't let robots hold your money! (Maybe an advice, more an admonition. No, no, not an admonition...)
If you buy and hold the old fashion way, the truth should win out:
Tesla is a set of people doing the best work of their lives to make the world a better place. Perfect? No. Best effort? Yes.
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This will take a lot of writing to explain.... feel free to PM me for details.
I have visited both Tsla and Lucid on numerous occasions and lucid strikes me as less than 1:1000 of what Tsla is in terms of financial, intellectual, real estate, and seat-of-the-pants feel.
Just not much there. They have a few good engineers and have thrown a few hundred million at a project.
Another way of stating it, after reading about Lucid and then touring the facility, to me it feels like there is less there than I expected. Every time I look at Tsla facilities up close I'm impressed with what is physically and intellectually there vs what I'm paying for as an investor in the company.
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Not TA, but the par share price for the 2022 notes is $327.50 and for the 2019/2021 notes $359.87. Above those respective levels, note holders can engage in arbitrage transactions and collect the semi-annual interest payments relatively risk free. Also, above those levels, the hedge counter-parties are exposed until the share price reaches the warrant levels--$655 for 2022, $512.66 for 2019, and $560.64 for the 2021 notes respectively.
The underwriters (and also likely hedge counter-parties) for the 2022 notes were:
Underwriters Principal Amount of Notes
Goldman, Sachs & Co. 425,000,000
Deutsche Bank Securities Inc. 27,500,000
Citigroup Global Markets Inc. 127,500,000
Morgan Stanley & Co. LLC 127,500,000
Barclays Capital Inc. 21,250,000
Merrill Lynch, Pierce, Fenner & Smith 10,625,000
Credit Suisse Securities (USA) LLC 10,625,000
Total 850,000,000 (add 15% to all the amounts for the "Greenshoe" options which were all exercised)
GS, MS, JPM, and DB were the underwriters for the 2019 and 2021 notes
Both prospectus for the notes state:
"In connection with establishing their initial hedge of the convertible note hedge and warrant transactions, the hedge counterparties or their affiliates expect to enter into various derivative transactions with respect to our common stock concurrently with or shortly after the pricing of the notes, including with certain investors in the notes. This activity could increase (or reduce the size of any decrease in) the market price of our common stock or the notes at that time.
In addition, the hedge counterparties or their affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to our common stock and/or purchasing or selling our common stock or other securities of ours in secondary market transactions following the pricing of the notes and prior to the maturity of the notes (and are likely to do so during any observation period related to a conversion of notes). This activity could also cause or prevent an increase or a decrease in the market price of our common stock or the notes, which could affect your ability to convert the notes and, to the extent the activity occurs during any observation period related to a conversation of notes, it could affect the amount and value of the consideration that you will receive upon conversion of the notes."
Whether any of the foregoing has or will affect the share price is unknowable, because no further disclosures or reporting after the prospectus occurs. Whether it influences the timing and content of the updates to the underwriters' sell-side analysts reports---???
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Ameliorate
Member
Was just playing around with charts and this almost seems too good to share. Obviously DYOD, history is not destined to repeat itself, TA isn't real etc etc but this year every single time RSI has dipped under 50 if you had bought, you made good money immediately after. We just touched on 30 for the first time in a long time. I threw my last pennies at it.
Heading into 2017 Tesla was in bear territory, news meant nothing everything was just sizzle, and the inverse of 2017 happened with the RSI, selling over 50 RSI in the bear run would've been ideal.
Sharing because I'd be clueless and know nothing about Tesla without all of your contributions.
As long as the bull market for tech reigns, I think this further validates closing some of the gaps and heading back to 350.
I do certainly like the direction of the upper BB too =) (407.22)
GLTA, I honestly can't wait for the semi reveal.
Heading into 2017 Tesla was in bear territory, news meant nothing everything was just sizzle, and the inverse of 2017 happened with the RSI, selling over 50 RSI in the bear run would've been ideal.
Sharing because I'd be clueless and know nothing about Tesla without all of your contributions.
As long as the bull market for tech reigns, I think this further validates closing some of the gaps and heading back to 350.
I do certainly like the direction of the upper BB too =) (407.22)
GLTA, I honestly can't wait for the semi reveal.
bdy0627
Active Member
I'm really glad we are having these concerns now rather than the "I wish I would have reduced leverage last week"
A thing to look at is delta vs purchase price.... that is what determines leverage. A Far Out Of The Money (FOTM) op has low delta, but because it is cheap to buy, it has a higher delta/price ratio than an NTM or ITM call, and provides more leverage.
The problem is, theta, time decay. If theta/delta is high, the stock price will have to move up faster to break even. You can be long calls, have the stock price move up, and still loose money because of this (stock price not moving up fast enough). FOTM calls are best bought on dips and sold on peaks well before expiring.
There is no free lunch. Options just give you more options (yes, pun intended) to flavor your risk profile. Please be careful.... I have lost 100s of k $ learning this and I'm still a novice.
bdy0627
Active Member
So when looking to pick up shares in an uptrend, the best deals are often to be had in the first 15 minutes. If you are looking to reduce leverage as the stock rises, the last 15 minutes is often the place to do it rather than at market open. It seems that mid day with the lower volume can be a manipulative time for shorts, so often not the best time to sell shares.
ValueAnalyst
Closed
Yes, for now, as the delta on an ATM option is high. OHOH, you can continue to buy shares as SP rises converting margin to equity.
Some would say you can also roll options, but I find option tx cost a lot more than margin interest.
One thing you can do with OTM options that you can't do with margin is taking on insane leverage, which I usually stay away from.
Although, given the recent irrational dip, I did convert a portion of my portfolio, as I said here, to options and also bought a lottery ticket a few days ago. We'll see how it plays out. So far so good...
ValueAnalyst
Closed
An exclusive look at Tesla’s plan to build largest EV charging station in the world with 40 Superchargers wow, that is going to be a game changer for that area, and also shows how serious tesla is about developing their infrastructure. If I were short I would be scared, this is like being short apple when the iphone came out. Except I don't think we will see the decline for a year that apple saw because the technology is already proven out since 2012 and only now the cost is right too
The primary reason why Apple experienced a one-year dip following the 100% iPhone debut rise in 2007 was the Great Recession.
I don't foresee a recession in the next twelve months. What I do see is an SP surge that resembles a SpaceX launch.
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bdy0627
Active Member
Yep, I'm going through the school of hard knocks on this right now after thinking I was a genius just starting with options during the run up. I was over $100k up and continuing to increase leverage even around $370. Turns out, my timing was just lucky initially. After dropping over $100k last week, i had to step back, reread some posts and books, set up some detailed spreadsheets, and catch my breath. The leverage with options is incredible (and addictive). The rise just today swung me back up $40k. I'm no TT007 but these are huge swings for me given that I was basically just investing in index funds and a moderate amount of TSLA stock up until 6 months ago.
Biggest lessons for me:
Set up your leverage plan for a dip and implement it then
Don't chase the stock up as it nears an ATH (you don't necessarily need to reduce leverage but don't increase leverage)
Be patient during the uptrend and the downtrend; don't buy on small dips thinking it will just bounce back up right away
Reduce leverage at some point on the way up or early on the way down (I'm still trying to figure that out)
If you're dreaming about your TSLA trades (and talking in your sleep about them according to my wife) then you are over-leveraged
So how do we explain the GS fud action that appears to have pushed the price below 350 ?
Do what I say, not what I do. Or rather, don't watch what I do, just listen to what I say.
I really think GS got a bug up their butts from the SCTY/TSLA merger, and will be consistently bearish on TSLA until they become positive EPS (and then probably will still be bearish until TSLA becomes part of SP 500). IIRC one of the board members was quoted as being in complete opposition to the SCTY/TSLA merger, maybe even calling it a bailout/scam.
I think around then, Archambault (sp?), their former bullish TSLA analyst took a new position with a company in Silicon Valley, leaving Tamborrino, who of course was immediately bearish. I suspect GS felt like they were blind-sided by the SCTY/TSLA merger and are now "permanently" bearish, except when and if TSLA seeks to do a cap raise. So I will continue to expect any and all future analyst predictions to be bearish, and IMHO expect GS to be short TSLA. Along with Petterfy (sp?) of IB, Chanos, Left, and a little MS.
I think around then, Archambault (sp?), their former bullish TSLA analyst took a new position with a company in Silicon Valley, leaving Tamborrino, who of course was immediately bearish. I suspect GS felt like they were blind-sided by the SCTY/TSLA merger and are now "permanently" bearish, except when and if TSLA seeks to do a cap raise. So I will continue to expect any and all future analyst predictions to be bearish, and IMHO expect GS to be short TSLA. Along with Petterfy (sp?) of IB, Chanos, Left, and a little MS.
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