Short-Term TSLA Price Movements - 2016

[drinkerofkoolaid]

Osborne effect

This is not proof of any Osborne effect.
All this means is Tesla is giving Model 3 deposit holders the ability to get into a Model S or Model X at a great price, while waiting for the Model 3. Anyone placing a deposit for a Model 3 today will likely need to wait 1-2 years for delivery. This gives them the opportunity to drive a Model S or Model X while waiting. Some will decide to keep the Model S or Model X. Others will decide to get the Model 3. Either way, it's a win for Tesla and a win for Tesla buyers.

 

[drinkerofkoolaid]

Just for fun.

 

[electricity]

why all the speculation ? it clearly says there that the 2 year lease is the most requested lease. It's probably the model 3 buyers requesting it, so they give it to them.

 

[Krugerrand]

why all the speculation ? it clearly says there that the 2 year lease is the most requested lease.

Clearly, it's not clear to some. More clearly, Tesla is just adding more lies to the demand is not a problem pile.

 

[MitchJi]

Yes, it was wise. Without doing so the following would not have happened:

a) Tesla wouldn't know the true demand for the vehicle, now they do so they can better plan with clarity and focus...which led to...
b) the timeline being pulled forward for the Model 3...which led to....
c) increased the pressure on the other OEMs to build EVs

a) Tesla wouldn't know the true demand for the vehicle, now they do so they can better plan with clarity and focus...which led to...
b) increased the pressure on other OEM's to build EV's....which led to...
c) the timeline being pulled forward for the Model 3...which led to....
d) the SP taking a small dive...

Which supports the conclusion that the Market is insane.

 

[vgrinshpun]

it's not unusual to be the first and last time you get to see them never mind buy one

And Tesla is obviously the most quintessential of car companies out there, just business as usual in every way imaginable

 

[Krugerrand]

d) the SP taking a small dive...

Thanks for making my post related to the thread topic.

 

[madodel]

it's not unusual to be the first and last time you get to see them never mind buy one

And thus far Tesla has actually delivered on what was revealed, unlike the prototypes the other automakers show but never have the guts to actually produce. That's the difference between a cutting edge market innovator and a bunch of has beens.

 

[electracity]

And thus far Tesla has actually delivered on what was revealed, unlike the prototypes the other automakers show but never have the guts to actually produce. That's the difference between a cutting edge market innovator and a bunch of has beens.

Musk actually showed a car close to an SUV at the first X reveal.

 

[Fallenone]

Seriously? If my broker lent my share I am not an owner? I don't participate in rise and drop of the stock?

Now, if my broker went bankrupt anything could happen, but until then, my account certainly shows I own TSLA, same as Adam. Difference being that I can't vote mine until I force recall. Hence 2 owners of (+1) TSLA, one owner of (-1) TSLA, equal 1 share = 1 vote

Yes you still have the position but you don't have ownership of the share. And there's still only 1 share not 2

 

[vgrinshpun]

Yes you still have the position but you don't have ownership of the share. And there's still only 1 share not 2

There is 1 outstanding share but 2 shares in circulation. These 2 shares in circulation reduce to the original 1 share only after short position is closed.

 

[3Victoria]

If one lends a book to a friend, and it is sold to someone else, there is only one book. If one asks the friend for the book back, he will need to buy a copy and give it to one. It most likely won't be the original copy, but equivalent to it.

If the book is in short supply, the friend may have to spend a lot of $ to get a copy.

Shares are the same, with the added complication that one's broker arranged the lending and is responsible for returning the share.

 

[schonelucht]

There is 1 outstanding share but 2 shares in circulation. These 2 shares in circulation reduce to the original 1 share only after short position is closed.

If there are two shares in circulation, then why isn't that reflected in market cap? No, there is still one share. What happens when you loan out a share is that you own but don't possess it anymore. Just like renting out a book to a good friend. There are not suddenly two books now. There is still one book. You own it, your friend possesses it.

 

[madodel]

Musk actually showed a car close to an SUV at the first X reveal.

Yep, I have one. Trolls said it would never be built. It was. Amazing vehicle. Does everything my Highlander Hybrid did, only without polluting the air and incredible acceleration thanks to instant torque. No gas car can match it. And so many other features that people find breathtaking. That was my point.

 

[rallykeeper]

If there are two shares in circulation, then why isn't that reflected in market cap? No, there is still one share. What happens when you loan out a share is that you own but don't possess it anymore. Just like renting out a book to a good friend. There are not suddenly two books now. There is still one book. You own it, your friend possesses it.

Let's see if I can explain this differently.

When you lend a share, you transfer ownership to your securities lending agent (the broker). You are entitled to receive the economic benefits of owning that security under the terms of your securities lending agreement, but you no longer own it in the same sense you own the book you lent. The broker sold that security to a short seller who then sold it on the market. That market buyer is now the sole owner of those shares with zero obligation to return the shares.

You will never receive back the shares you "lent" -- you will receive someone else's shares.

Because you are no longer the legal owner of those shares, you can't vote them and you can't receive dividends. (The securities lending agent is responsible for paying you a "dividend in lieu" but that is not a dividend it received from the short seller. It is simply a fee it charges to the short seller. None of you, the securities lending agent and the short seller received a dividend from the company).

Finally, I do agree with the book analogy in one regard. There aren't two shares in circulation. Any shares that have been "lent" are out of circulation. The lender's shares are no longer shares, just an obligation of the borrower (comparable to a securities derivative).

 

[RobStark]

it clearly says there that the 2 year lease is the most requested lease. It's probably the model 3 buyers requesting it, so they give it to them.

It also cements those customers as Tesla customers.

They don't switch to another brand in frustration.

 

[MitchJi]

Fiinally, I do agree with the book analogy in one regard. There aren't two shares in circulation. Any shares that have been "lent" are out of circulation. The lender's shares are no longer shares, just EV an obligation of the borrower (comparable to a securities derivative).

Except that the effect on the SP is the same as if there were two shares. Because both the original owner and the new owner are long one share.

 

[3Victoria]

Yes agreed. So if A lends to B who sells to C and C lends to D who sells to E, ..... great effect on SP!

 

[vgrinshpun]

If there are two shares in circulation, then why isn't that reflected in market cap? No, there is still one share. What happens when you loan out a share is that you own but don't possess it anymore. Just like renting out a book to a good friend. There are not suddenly two books now. There is still one book. You own it, your friend possesses it.

Market cap is based on outstanding shares, rather than shares in circulation.

What do you call a good friend who sells the book you rented to him? What good friend calls you if before renting him a book you insist on cash collateral in the amount greater than value of the book?

Seriously, though, the reason that there is only one book is because you can't sell the book that you lent to your good friend. Your good friend can't sell a book rented from you neither. So analogy does not work.

I hold shares of TSLA in margin account at Fidelity. Fidelity is free to lend all my shares to a short seller, who sells them to a third party. I can sell my shares. The third party can sell shares bought from the short seller as well. Short selling increased shares in circulation (regardless whether I sell shares that Fidelity lent or not). That is why short selling increases liquidity. Welcome to the virtual reality.

I have a puzzler (all numbers at the end of Q2):
There are 148.7M outstanding TSLA shares.
There are 100.5M institutional shares (per Nasdaq page)
There are 31.1M shares owned by Elon.
There are 31M shares sold short

Neglecting shares owned by other insiders, how many shares are held by others (retail)?
A. 148.7 - 100.5 - 31.1 = 17.1
B. 148.7 + 31 - 100.5 - 31.1 = 48.1

P.S. This is very good discussion, but just to maintain it's quality, can we agree not to use word "No"?

 

[Turing]

So it's kind of like fractional reserve banking. If i own 1k shares of tsla in my margin account and I'm holding long, and those are lent to people who sell them short, then 700 of 1k of those shares are purchased by people with a margin account, then those 700 can be lent and sold short, another 400 of the 700 are purchased long by someone with a margin account, ect?