You can install our site as a web app on your iOS device by utilizing the Add to Home Screen feature in Safari. Please see this thread for more details on this.
Note: This feature may not be available in some browsers.
You don't know that. Tesla may be installing the system on a PPA, Power Purchase Agreement, where the customer is just paying for the power generated, not the solar install itself. (Maybe at the $0.07/kWh that Tesla mentioned in the Semi presentation?)
I guess that is still getting revenue from the solar installation, just not up-front in a big chunk.
You don't know that. Tesla may be installing the system on a PPA, Power Purchase Agreement, where the customer is just paying for the power generated, not the solar install itself. (Maybe at the $0.07/kWh that Tesla mentioned in the Semi presentation?)
I guess that is still getting revenue from the solar installation, just not up-front in a big chunk.
Thanks for the detailed analysis here! However...I generally agree with the old addage that there are three types of lies: white lies, damned lies, and statistics, and this is definitely looking like a simplified version of the homework that I was just recently helping my still-in-high-school-but-taking-stats-in-college-at-the-same-time-just-for-fun daughter do last week, so let's have some fun here.
First off, change from open-to-close each day, rather than prior-day-close-to-this-day-close is a *very* interesting choice. So, just to be clear, for yesterday, your approach would say TSLA went from an OPEN of $234.05 to a CLOSE of $227.82, for a LOSS of $6.23 per share, rather than the $0.28 GAIN that I show for yesterday ($227.54 COM 10/31 to $227.82 COM 11/1). Odd - I seem to remember my remaining shares making money yesterday, not a several-percentage-point loss.
Perhaps this should be a quick poll...Please click LIKE if your TSLA shares went up $0.28/share yesterday and click DISLIKE if your TSLA shares went down $6.23/share yesterday.
It was a very arbitrary choice, and one which I see after review actually weakened my thesis.
I had tried several possible combos of how to measure short-term stock price movement when I did this analysis back in August and found that it doesn't really affect the overall average results much. This is due to the fact that differences between the open-to-close % change and the open-to-next-day-open % change average out to approximately zero, and my overall sample size for stock sales is 20, which is reasonably large. I presented tables and graphs for only one of them for brevity's sake.
Here is the scatter plot again with the requested adjustment to use the difference between opening price on days Elon has sold and the opening price the next day.
As we can see, there is clearly no negative effect and if anything the TSLA price tends to be slightly higher on the morning after Elon's selling days, which happened in 13 out of 20 instances (65%).
The average increase after Elon's sales measured this way was +1.3% after adjusting for TSLA's beta and what the S&P 500 did that day, compared to a baseline average of +0.1%.
In fact, that adjustment appears to make the case stronger that even on the days Elon sold more than 5% of the float there was zero measurable impact by opening bell the following day.
After looking at all this data I think we can conclude that the only reason to care about exactly when Elon sells stock and exactly how much he's selling is if:
You're day trading TSLA
It happens to be one of the rare days in which Elon is going to sell 5% or more of the volume
You somehow know this in advance
You have no ethical or legal qualms about insider trading
Therefore, I wish this issue would stop garnering so much unwarranted attention to make room for information and discussion that's actually useful.
And also another helpful Tesla breadcrumb to identify which ‘news’ sources are independent and which ones are at the end of strings controlled by Wall Street.
That is a huge metric that has long been reported globally. Thus those results are already widely known among insiders. Now it is time to see who reports that information before a TSLA rally and who waits to report it until after the rally is already underway. Those that wait till the whales are already done feeding in this perfect oversold storm are the real despicables - shame on them and their unethical approach to journalism. And words cannot describe the ones that won’t publish those facts at all. But one things for certain - When that news is ‘released’ (meaning Wall Street says “we’re all full and ready”), then hang onto your hats! I just hope Zach doesn’t take a beat down for showing us his independent spirit in journalism.
It's Tesla solar, my point is they get margin at LEAST on the equipment. And if there is a PPA then that profit is baked into the revenue sharing for the location (because excess generation is sold to the grid).
One way or another, Tesla makes money on the installation.
It's Tesla solar, my point is they get margin at LEAST on the equipment. And if there is a PPA then that profit is baked into the revenue sharing for the location (because excess generation is sold to the grid).
One way or another, Tesla makes money on the installation.
No. If it is a PPA Tesla gets $0 for the equipment. The margin on installation is 100% negative. Tesla pays to install it, and then just sells power over time. So the revenue to pay for that equipment may take years to come in, before the margin for the install becomes positive.
No. If it is a PPA Tesla gets $0 for the equipment. The margin on installation is 100% negative. Tesla pays to install it, and then just sells power over time. So the revenue to pay for that equipment may take years to come in, before the margin for the install becomes positive.
I LITERALLY just said that above. ONE WAY OR ANOTHER, Tesla makes money on it. Either on the kit, or on the power from the kit over 20 years (the term a PPA lasts in the state of CA).
"One way or another, Tesla makes money on the installation."
EDIT - for anyone that cares, the applicable regulations in the state of CA on PPA:
It was a very arbitrary choice, and one which I see after review actually weakened my thesis.
I had tried several possible combos of how to measure short-term stock price movement when I did this analysis back in August and found that it doesn't really affect the overall average results much. This is due to the fact that differences between the open-to-close % change and the open-to-next-day-open % change average out to approximately zero, and my overall sample size for stock sales is 20, which is reasonably large. I presented tables and graphs for only one of them for brevity's sake.
Here is the scatter plot again with the requested adjustment to use the difference between opening price on days Elon has sold and the opening price the next day.
As we can see, there is clearly no negative effect and if anything the TSLA price tends to be slightly higher on the morning after Elon's selling days, which happened in 13 out of 20 instances (65%).
The average increase after Elon's sales measured this way was +1.3% after adjusting for TSLA's beta and what the S&P 500 did that day, compared to a baseline average of +0.1%.
In fact, that adjustment appears to make the case stronger that even on the days Elon sold more than 5% of the float, there was zero measurable impact by opening bell the following day.
After looking at all this data I think we can conclude that the only reason to care about exactly when Elon sells stock and exactly how much he's selling is if:
You're day trading TSLA
It happens to be one of the rare days in which Elon is going to sell 5% or more of the volume
You somehow know this in advance
You have no ethical or legal qualms about insider trading
Therefore, I wish this issue would stop garnering so much unwarranted attention to make room for information and discussion that's actually useful.
Great data and discussion, thank you. I do think there’s one variable here that’s not accounted for in your analysis as best I can tell. Elon gets to choose when to sell. It is also likely that Elon doesn’t want to hurt the stock price or at least wouldn’t want to be sen as dropping the stock price when he sells. Therefore, it seems likely to me that Elon would sell into strength. In other words, Elon could time his selling to coincide with positive news or triggers to negate the impact of this selling. There seems to be some anecdotal evidence to support this.
I’m not in the “Elon can never sell his shares” crowd. I’d rather he not have bought Twitter, but that’s entirely his prerogative. Just seems hard to prove this theory one way or another without knowing what the SP would have done if Elon didn’t sell. Perhaps we can conclude his selling wasn't disastrous, but not sure we can conclude that it had little to no effect. It’s seems rather counterintuitive to think we wouldn’t be higher now if not for Elon’s selling.
Here's something else that's been debunked that could have stopped that conversation before it even started:
The notion that selling from Elon has any material effect on the short-term TSLA price after factoring out the correlation with macros.
We can have 95% confidence that there is a small, transitory, non-zero downward effect that lasts for maybe one day when Elon sells.
When he sells more than 5% of total trading volume, we have a sample of 5 data points with roughly 7% decline. However the effect appears transitory because in all cases, TSLA reached the same original price level again at some point within the subsequent week or two.
This result may be counterintuitive to a lot of people who want to keep worrying and posting about it. The evidence indicates that this activity is a complete waste of time, except maybe on the options thread where people have real concerns about stock price movements occurring in a matter of a day or two.
This chart shows, for each of the 20 days Elon has sold, the TSLA price change from opening to closing after adjusting for TSLA's beta.
View attachment 870155 TSLA price % change from open to close on days Elon has sold:
n = 20
Sample Average = -2.3%
Std Dev = 4.8%
95% confidence interval = [-4.4%, -0.2%]
99% confidence interval = [-5.06%, 0.46%]
TSLA price % change from the opening price on the day of the sale to the day 5 trading days after the sale:
n = 20
Sample Average = +0.9%
Std Dev = 9.2%
95% confidence interval = [-3.1%, 4.9%]
99% confidence interval = [-4.4%, 6.2%]
So, historically Elon's sales are associated with an expected average single-day TSLA decline of about 2.3% give or take 2 or 3 percentage points. We don't even have high confidence that the true average effect is less than zero, because 0 is on the edge of the margin of error. TSLA actually gained on 5 of the 20 days in which Elon has sold.
As a matter of fact, when looking at all of Elon's sales, the potential downward bias appears to be transitory. The data shows no evidence of consistent residual impact on the TSLA price a week after the sale, and on average TSLA has gone 0.9% higher after 5 trading days have elapsed.
Date
Elon Sale Amount
Total TSLA Volume
Elon % of TSLA Volume
TSLA Open
TSLA Close
TSLA % Change
TSLA Close 5 trading days later
TSLA % Change 5 trading days later
S&P 500 Open
S&P 500 Close
S&P 500 % Change
TSLA Expected % Change Based on Linear Model of S&P 500 Influence
Responses to this excellent post are funny. Mostly sound like "Screw your stupid facts and data! My precision calibrated gut-stock-price-meter says otherwise!"
I LITERALLY just said that above. ONE WAY OR ANOTHER, Tesla makes money on it. Either on the kit, or on the power from the kit over 20 years (the term a PPA lasts in the state of CA).
It is possible that the installation and maintenance costs could end up being greater than the money they collect from selling power. While that is unlikely, it is possible. And we have no way to know how likely because we aren't privy to the details of the detail.
i.e. You are not 100% guaranteed to make money on a PPA.
Responses to this excellent post are funny. Mostly sound like "Screw your stupid facts and data! My precision calibrated gut-stock-price-meter says otherwise!"
The data is accurate within it's parameters. Let's do a simple thought experiment: Elon announces he's selling even more shares. Stock goes up, down, or does nothing? The data says the stock should go up.
It is possible that the installation and maintenance costs could end up being greater than the money they collect from selling power. While that is unlikely, it is possible. And we have no way to know how likely because we aren't privy to the details of the detail.
i.e. You are not 100% guaranteed to make money on a PPA.
Wow. Really? That's the BEST argument you can do after giving me like 5 disagrees?
Question 1 - have power rates in CA, over average 5 year periods, EVER gone down?
Question 2 - do you think Tesla's management is stupid enough to enter into a 20+ year contract that they think they have a reasonable chance of losing money on?
Dude, this was like the "let me pull out the argument of a 6th degree outlier so I can save face and pretend to win the argument".
I stand by my original post on the subject - Tesla is going to "double dip" this, one way or another, to make some money aside from just the sale of the Semi. If you want to argue that till you are blue in the face, have at it bro.
Great data and discussion, thank you. I do think there’s one variable here that’s not accounted for in your analysis as best I can tell. Elon gets to choose when to sell. It is also likely that Elon doesn’t want to hurt the stock price or at least wouldn’t want to be sen as dropping the stock price when he sells. Therefore, it seems likely to me that Elon would sell into strength. In other words, Elon could time his selling to coincide with positive news or triggers to negate the impact of this selling. There seems to be some anecdotal evidence to support this.
Correct, this is one possible reason, but an extremely unlikely one because by definition that would be blatant illegal insider trading based on material nonpublic information. I certainly hope Elon is not doing this and I think he's a more ethical person than that.
I'm not a lawyer but I do see that Elon's Form 4s show he sells via 10b5-1 plans, which are defined in the Code of Federal Regulations here:
I’m not in the “Elon can never sell his shares” crowd. I’d rather he not have bought Twitter, but that’s entirely his prerogative. Just seems hard to prove this theory one way or another without knowing what the SP would have done if Elon didn’t sell. Perhaps we can conclude his selling wasn't disastrous, but not sure we can conclude that it had little to no effect. It’s seems rather counterintuitive to think we wouldn’t be higher now if not for Elon’s selling.
Right. All that has been conclusively established is that there is no correlation. Maybe we could think that this data resulted from Elon's behavior somehow perfectly cancelling out good stuff on the same exact days he sold, and somehow this also wasn't because of illegal trading.
Lots of things in this world are counterintuitive. Finding surprises and learning is the fundamental purpose of using the scientific method instead of intuition.
To be clear, this data does not indicate anything about whether a long-term bias exists due to Elon selling, which I think is what @JRP3 is saying. I think that it probably does exist to some extent, but it's definitely at least 5x less influential than the macros, as shown by the R^2 of 84% on a regression of TSLA vs. S&P 500 and 84/(100-84) = ~5. Also I haven't seen anyone come up with a way to test it so discussing this is low-value guesswork anyway.
Karpathy also told us the reason this management style is not prevalent. Essentially he said you need a very smart person with a big hammer who is willing to make decisions.
What Karpathy means is you need a genius level engineer in power. This is pretty much unheard of previously. It is nearly impossible for engineers to rise up to the C suite in normally managed companies. A smart engineer isn't going to wade through 3 or more layers of middle management positions which lack decision making power and don't do any engineering. Karpathy even left Tesla largely because he got tired of being a manager.
So it's nearly impossible to find a new "Musk style" executive in an existing company... likely difficult even in Tesla.
Going to expand on this a tiny bit and forgive me for dragging the A word into the conversation.
Apple under Steve Jobs was quite similar. Though Jobs never got into the nuts and bolts of engineering the way Musk does, he was deeply involved in the design side of things and was quite good at finding good director/ C level managers under him that had a similar style to his own. Jobs was quite good at picking which "Arrows" to put their efforts behind and committing to those efforts. So perhaps this style is a bit more repeatable than I first assumed. Though much like Musk, Jobs was a founder and had a lot of support from the board.
Seems like the formula is: A manager who is deeply committed to the company. Has extremely judgement about product and is willing to exercise that judgement ruthlessly. Is willing to ignore outside opinions. Has the support of the board even when things seem to be going sideways.
As @unk45, and before him or her, @jbcarioca mercilessly would pound on this thread, the Clean Technica’s Top 20 chart perfectly illustrates the breadth and depth of Chinese players in the Plug-in market. If I haven’t confused some Korean with Chinese names, 15 of those vehicles are Chinese, plus Tesla, Hyundai, Kia & VW.
The only other item I’d like to share, for the sole benefit of @RobDickinson, @Thekiwi and some other UpsideDowners, is that it’s obvious to me that it is incumbent on Kia and GW Ora to merge
...
The only other item I’d like to share, for the sole benefit of @RobDickinson, @Thekiwi and some other UpsideDowners, is that it’s obvious to me that it is incumbent on Kia and Gw Ora to merge
Wondering if there is anyone on TMC that believes Wall Street doesn’t yet know what the Fed Interest Rate decision will be shortly………………asking for a friend
