Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[Blue horseshoe]

I'm starting to contemplate at what price I will resume accumulating shares. BFPT was very helpful to me in the past. But we have undergone fundamental change in how the market perceives Tesla, so the BFPT will not be well calibrated for about a year.

Within my IRA, my strategy has been to sell off excess shares as the value of my position rises above a certain upper value limit (UVL). The last price I sold at way $500. The proceeds I have reinvested in other stocks that I believe have a material chance of beating Tesla over the next year. My intent has been to hold this UVL until the non-Tesla portion of my portfolio becomes substantial. But we could be faced with a 20% to 30% pullback. This also means that the value of my Tesla position falls 20% to 30% below my UVL. So the question I'm asking myself is whether I want to set some lower value limit (LVL) below which I accumulate more Tesla shares. This means I would be trading to keep the value of my Tesla position between my LVL and UVL. So I'm thinking about setting LVL to 0.8*UVL, but 0.7*UVL might also be reasonable. The choice here would seem to depend on volatility and how much trading I want to do. Since this is in an IRA I don't have to worry about capital gains or other trading costs.

Any suggestions?

Depends on your valuation of Tesla's future. Based on what you wrote it appears that you believe other stocks in your portfolio have higher growth potential than Tesla. You should come up with a target number for those stocks and also for Tesla. If Tesla drops to a level where it's undervalued and has a better chance to make you more money then that's where your LVL limit should be.

Something to contemplate is setting a LVL (say .8*UVL) and mapping out when you'll buy back. Will you buyback immediately and with enough dollars to maintain the LVL or would you dollar cost average and setup something like initiate buys of X dollar amount per day to DCA when the stock is below your LVL.

Also, think about adjusting your UVL to better take advantage of upward price movements. Instead of immediately selling to cap your UVL have it set off a sell program. For example once your UVL is hit maybe come up with X dollars in value to sell per day until the total value is below your UVL.

Personally I think TSLA will grow to be the most valuable company in the world within ten years so my UVL is infinity and my LVL is equal to current value: ie. buy at any price up until the year 2030.

 

[jhm]

Rethink what you think the next year beings for TSLA.

Thanks. I think I am amply positioned to benefit from Tesla over the next year and beyond. Where do you think the stock could be in the coming year?

 

[MP3Mike]

They could do buybacks after the squeeze. That way, we (HODLers) don't get diluted, and only those who sell for short term gains end up paying the bill.

It's a win-win situation for the company and its actual supporters - long-term investors.

What would that really do? Just delay the same thing? Or are you saying that Telsa would drop a huge amount of shares on the market for the S&P 500 funds, and then afterwards buy them back slowly? (I don't see how that is any better than letting the S&P500 funds buy, causing a spike, which then comes back to normal on it's own.)

Don't they say that the market is efficient? Why not just let the efficient market handle the buying naturally.

 

[dl003]

What would that really do? Just delay the same thing? Or are you saying that Telsa would drop a huge amount of shares on the market for the S&P 500 funds, and then afterwards buy them back slowly? (I don't see how that is any better than letting the S&P500 funds buy, causing a spike, which then comes back to normal on it's own.)

Don't they say that the market is efficient. Why not just let the efficient market handle the buying naturally.

What it does is regulate the rally so that hedge funds and traders don't ruin it for everybody. As we saw this week, frenzies don't do anyone any good, except the perpetrators. Afterward, that cash balance can serve as deterrence against shorts and market makers. Hey, you want to short? How about I buy it back at a discount? Thank you very much. Imagine TSLA file an 8-K stating that we'll do buybacks at a time, price, and amount we like. Chanos will *sugar* his pants.

 

[StealthP3D]

I got a call from Equiniti. It was a helpful chap who was very apologetic and said he understands how frustrating it has been. Added to which he is giving me £200 by way of apology for the inconvenience. That was a nice touch.

Really? If a valet sideswiped your car while parking it and it left a big crease down the side, would you consider it a nice touch if he spotted you a $20 for your trouble?

 

[Curt Renz]

In the interest of saving time and being up to date super fast, I would recommend people to use a paid version of RSS. I ave tons of time refreshing the common tesla culprit websites. And I know immediately if there is a tesla related news jumping up within my channel and knowledge sphere

Danke for the suggestion. However, a prime reason for posting these articles is to invite discussion of their content from TMC members. Perhaps you can become the first to post newly published articles.

 

[Nocturnal]

Yes, Tesla needs to protect people from themselves because setting your phone to the home screen, turning off the home screen, or having a lock code so one can’t accidentally call people or make purchases when one deliberately sits on their phone is Tesla’s responsibility.

x a bajillion.

Personal responsibility has no place in this world. Ever.

I’m going to pick a more substantial hill to die on.

Relax, nobody is dying on this hill. Nobody is talking about responsibility either so climb down off that soapbox. It's just common sense. Why not add an incredibly EASY and STANDARD form of security for something like this? Yeah, I can't buy a movie from Amazon or an app from Apple without password confirmation but I'm an asshole for suggesting it's easier for Tesla to add a password check than to deal with refund requests from idiots. Elon himself agreed didn't he?

Instead we have Tesla wasting time dealing with refunds and trying to sort out who did what. It's CYA.

Tesla addresses "butt-dialed" in-app purchases with new refund policy

 

[SOULPEDL]

What do you think the sharks that run this place on a day to day show up for your benefit?

I've wonder this re TMC members (assuming that's who you meant). My logic so far has been that the wealthy sharks at TMC are here to support a cleaner future, be it from guilt or good gesture, and they're informing friends and neighbors the same tune. Others are here to convince me to HODL (and they're doing a great job there) - whether it's for their own portfolio or goodness doesn't matter to me really. Either way, welcome sharks!

 

[amolina]

I've wonder this re TMC members (assuming that's who you meant). My logic so far has been that the wealthy sharks at TMC are here to support a cleaner future, be it from guilt or good gesture, and their informing friends and neighbors the same tune. Others are here to convince me to HODL (and they're doing a great job there) - whether it's for their own portfolio or goodness doesn't matter to me really. Either way, welcome sharks!

I think he/she meant the Market Makers. Not TMC members. TMC members are lovely and sweet and completely not shark like

 

[M|S|M MYP]

I think he/she meant the Market Makers. Not TMC members. TMC members are lovely and sweet and completely not shark like

TMC members are lovely and sweet and completely not shark like - You must be new here

 

[MTL_HABS1909]

Today is definitely not about pushing the stock down. Nasdaq down big on decent volume. Tesla is lucky to only be down 8% when the Nasdaq is down 5%

Thank the uptick rule for that

 

[dl003]

TMC members are lovely and sweet and completely not shark like - You must be new here

He probably hasn't gone through the Coronavirus thread.

 

[Joe F]

Imagine TSLA file an 8-K stating that we'll do buybacks at a time, price, and amount we like. Chanos will *sugar* his pants.

He can't; He's already lost them, along with his shirt(s).

 

[SOULPEDL]

I think he/she meant the Market Makers. Not TMC members. TMC members are lovely and sweet and completely not shark like

Thanks, I had a funny feeling there. This is what I get when TSLA goes on sale and I skip to the last 2 pages here and hurry to figure out if/when to buy more TSLA. Then I drink some coffee and mellow into the TSLA confidence groove. There was nothing there there.

 

[amolina]

TMC members are lovely and sweet and completely not shark like - You must be new here

Haha, I ignore the sharky ones. I chose to focus on Loouuuve

 

[floydboy]

Man, anybody having the troubles of the types I'm having with Fidelity? In what was supposed to be a simple clerical change to our brokerage account(multiply the shares by 5, divide the share price by 5) has turned into a nightmare! These brilliant people had managed to pull 2/3 of our shares in the brokerage account and redistribute them among our other IRA accounts, immediately triggering a margin call on a loan we had against the account! They also resurrected a dead 401k account and completely lost a cash account, with the associated cash, tied to the brokerage account.

I have to admit, it's been a very, very long time since I've used language like I did on the telephone! Now they've assured me they would have it all corrected by Friday(I spoke to them on Tuesday) but I still don't see any changes. I'm thinking I've aged about 5 yrs/day lately.

 

[kanweg]

There may still be some folks whose brokers are finally entering the Tesla dividend shares into clients' accounts. Today might be the first day for them to sell or place stop limits on the new shares. We likely saw some of this yesterday and perhaps more today.

Regarding an S&P 500 inclusion, my guess has always been after the market close on September 18th in conjunction with the quarterly rebalancing. That may make the process smoother for index funds. Usually the announcement of a rebalancing is made a week prior, but last September it was two weeks prior. This year the fact that only US markets will be closed on Monday for Labor Day, would seem to make an announcement tomorrow impractical. Otherwise the European exchanges could experience chaos on Monday. Tuesday may be more likely for an announcement, or perhaps as late as Friday September 11th to allow for a weekend in which index funds can plan their reallocation strategies.

So they get a whole Tuesday night to make the strategy plan, instead of 3 days. Or if we take AH into account, about no time at all. For that matter, they could announce today and give the details tomorrow.

Ignoring AH, as long as they stick to the same time of announcement, Europe will always have a head start for chaos. The volumes there are insignificant, however.

My measly brain powers were not listed as curable on the Neuralink slide. And the bit I know about investing and how it all works is a single bit (zero).

 

[StealthP3D]

When I suggested, when the S&P inclusion became possible after Q2, that hedge funds could do exactly this kind of fore running, a lot of regulars here was pretty vocal about that being impossible because "why would they help other funds", "where would they get the money from", "why would the buy and then sell to other funds" etc etc.

You have a misunderstanding. There is no doubt that front-running announcements like this happens - that's simply speculating the stock will be worth more tomorrow than it is today (due to an expected announcement).

The "pushback" I saw on this thread was against the idea that a company holding multiple fund types would use one of their funds to front run TSLA purchases so another fund (their S&P Index Fund) could buy it from the other fund "at a reasonable profit" but below market rates. That's not gonna fly for reasons that have already been explained.

Also, a true S&P Index fund tries to track the S&P as accurately as possible. They are not going to be buying TSLA until they know for a fact it is entering the S&P (otherwise their clients could sue if they lost a lot of money by guessing wrong). There are also funds that try to beat the S&P 500 Index. These funds can front-run at their own risk (for themselves).

Edit: I can't help but notice that those most vocal then has been quiet on the subject the last few days when it's been brought up by more prominent twitter people.

Any quietness is probably due to this having been re-hashed to death. Front-running happens, but it is normal speculation. The push-back was against wild scenarios that make no sense.

 

[Curt Renz]

Pay-walled by Bloomberg - 10 minutes ago: Elon Musk Suggests Tesla’s Berlin Factory to Make Redesigned Model Y

 

[floydboy]

Proof cat's can't type.

Hey man, that's RUFF!