shorting Tesla

User Forum Topic
Submitted by moneymaker on February 1, 2018 - 9:37am

Never shorted a stock before, but if the 1 year expectation is 40 points lower for Tesla, wouldn't a short be a good idea?

Submitted by spdrun on February 1, 2018 - 10:49am.

Depends how irrational the markets are willing to get :)

Submitted by henrysd on February 1, 2018 - 10:06pm.

I am buy and hold guy, never have guts and possibly the skills to successfully short any stock. Telsa is one of bubble stock now, but even if you are right, other people, especially those wall streets traders have to follow you with the same bet for you to make money. Little fish can't fight the big guys. In 2005-2006 time many piggs here already knew about housing market cracks, but how many actually made housing related shorting profits when wall street still liked mortgage lenders? The real shorting opportunity happened in spring 2007 with public traded sub-prime mortgage lenders.

Submitted by moneymaker on February 2, 2018 - 7:47am.

I just figure with the recent rocket problems, car production not meeting earlier estimates and the Powerwall not really being economically feasible yet that Tesla might be ready for a correction.

Submitted by millennial on February 2, 2018 - 11:14am.

Even if you are right. The market can stay irrational a lot longer than you can stay solvent.

Submitted by Escoguy on February 3, 2018 - 12:03am.

I shorted amazon back in 2000 successfully but thank God I closed the position after a profit.

Long story short, there are better forums to read about shorting Tesla but while it may look appealing, they have no problems raising funds.

Once they solve the short term production problems, it could well be off to the races.

Apple could also be a buyer for them and only use a small portion of their cash.

Submitted by Hobie on February 3, 2018 - 7:20am.

Tesla and Apple would be a good fit. But I can't see Musk selling. New battery tech will benefit both companies immensely.

Submitted by FlyerInHi on March 1, 2019 - 5:27pm.

Oh no! Tesla closing their stores.
I want to see them successful. Hope they can get the model 3 onto mass market and economies of scale.

Submitted by moneymaker on March 1, 2019 - 6:59pm.

Honestly I don't even remember making the original post, but looking back looks like Tesla could have been successfully shorted 3 times in last year. Wife got her $1000 deposit back, within a week I think. Would still buy one if the numbers worked but they just don't seem to at the moment. Here's what it would take
1) Solar system making way more electricity than we use
2) Ability to use batteries in car as backup for the house
3) Free parking for the wife at work
4) Free charging
5) A 0% interest loan
6) A 10 year/100K mile warranty
On a related note looks like SDG&E randomly pre selected me to be switched to a TOU plan that would have costed me almost $200 more per year based on last years usage. I called them and opted out.

Submitted by Hatfield on March 1, 2019 - 10:28pm.

Too scared to short and put options don't look all that attractively priced, so I'll sit this one out.

Submitted by Coronita on March 2, 2019 - 9:21am.

Funny this thread came up because now that they are taking orders for the base model at $35k, I might order one and add a 7th car to my garage.

6250 EV tax credits puts this below $30k before tax license etc... Hyundai sonatas are ringing up near that these days.My 2017 Miata was around that price after s plan racer discount pricing .

I am thankful a lot of people bought into the initial hype and spent close to $50k+ for this car so Tesla can continue to build these base models for those of us that don't want to pay $50k for a car that imho looks very similar to a Mazda 3. Now that the initial teething of a first year production run has settled, it's looking to be compelling for me.

But man, those base model wheels sure are fugly.

Submitted by moneymaker on March 3, 2019 - 6:51pm.

Now in less than 2 weeks there will be an alternative, model Y, an SUV, not sure what the wheels look like. It will cost 10% more and have less range with the same battery, just saying, I'm sure it will be slower too though.

Submitted by outtamojo on March 3, 2019 - 9:36pm.

A lot of people take off the plastic covers on those aero wheels.

Submitted by outtamojo on March 3, 2019 - 9:39pm.

moneymaker wrote:
Now in less than 2 weeks there will be an alternative, model Y, an SUV, not sure what the wheels look like. It will cost 10% more and have less range with the same battery, just saying, I'm sure it will be slower too though.

I cant wait till the porsche ev's come out.

Submitted by flyer on March 4, 2019 - 8:26am.

Will be interested to see if Musk moves forward with a private jet that competes with the Cirrus or Honda (vs. the electric airplane that takes off vertically, which he's mentioned)--both of which represent the smallest private jets made--and both of which are back ordered.

Looks like the demand is there at those price points, for commercial and private use, since both are far more reasonable than most any small Cessna Citation Jet, which has long been the benchmark in that category.

Submitted by Coronita on March 4, 2019 - 10:27am.

Buying a Porsche SUV is as bad as buying a Porsche with an automatic. Just say no and get a real Porsche

Submitted by flyer on March 4, 2019 - 3:47pm.

Agree.

We can't take anything with us, so might as well enjoy it all while we're here.

Submitted by Coronita on March 7, 2019 - 12:45pm.

Dealbreaker for me on the Tesla Model 3....

The insurance cost.
With a $500 deductible on collision/comprehensive, it's $1125/6month to insure....

That's actually a few dollars/year less than insuring a Porsche 911s...and I balked on the insurance on the 911s. If I had to choose the two, I'd get the 911s...lol.

Submitted by svelte on May 19, 2019 - 11:22am.

Stock down to $211. Ouch.

Seems like everything is going wrong for Tesla lately.
Fires. Autopilot deaths. Tariffs. Slowing US sales.

I really do think they'll have to be purchased by another company, probably in 2020.

As others have said, an Apple-Tesla tie up seems to be a match made in heaven, but I'm not sure Apple is interested in the auto industry any more.

Submitted by moneymaker on May 20, 2019 - 7:41am.

How much would insurance be if paid cash for $35K Tesla and just got the minimum required by law in CA? If still way up there then would be a deal breaker for me and I can see why Elon is trying to get into the insurance business.

Submitted by Coronita on May 20, 2019 - 9:52am.

moneymaker wrote:
How much would insurance be if paid cash for $35K Tesla and just got the minimum required by law in CA? If still way up there then would be a deal breaker for me and I can see why Elon is trying to get into the insurance business.

Insurance cost doesn't really change based on whether you finance or outright own....

Musk is probably doing this so it's a one stop purchase / lease ..bundling .

Submitted by spdrun on May 20, 2019 - 10:43am.

Of course insurance cost changes if you don't own -- if you buy for cash, you can drop collision/comprehensive and just carry state minimum liability.

Submitted by Coronita on May 20, 2019 - 3:18pm.

spdrun wrote:
Of course insurance cost changes if you don't own -- if you buy for cash, you can drop collision/comprehensive and just carry state minimum liability.

Dropping collision and comprehensive on a brand new $40k car is one of the stupidest things one can do.... almost as stupid as carrying only the minimum liability insurance if one has meaningful amount of net worth worth protecting...

No one in their right mind would spend $40k+ on a new car and then simply not get collision and comprhensive. That thought process is only for people use to buying really old beater car that are disposable... (Even in the case of a beater car, it might even make sense to get comp/collision... if you're like me with multiple cars, fully insuring one beater car with $0 deductible comp/collision is an extra $50/year, but for the times you rent a car and you waive the optional insurance, you end up have a $0 deductible on the car rental too IF you were to get into an accident...because your best comp/collision coverage would take effect)

Any financial advisor that suggested that one should drop down to the minimum liability coverage while maintaining a $1million+ net asset portfolio, should fired immediately because he is a moron, especially if one lives in sue happy CA, NY, NJ.

The only reason why one would consider getting mimimum liability coverage is he/she has no money/net worth worth protecting.... If that's the case, there's a high probably that person isn't in the market to buy a $40k car with cash, or if he/she is, it would be an incredibly stupid financial decision... making this discussion about insurance costs pointless.

With most normal people, who find the rational reason for decent insurance coverage, there is practically no difference for identical coverage whether the car is purchased with cash or financed.

Submitted by svelte on February 4, 2020 - 7:31pm.

Holy freakin christ I hope nobody on here actually shorted Tesla...they were up to $961/share at 3:30 today!

From a low of $178/share on June 3, 2019!

What rational reason can there be for that?

Sure they showed a profit and it looks like the tide may be turning for them, but let's get real here!

I think the most logical explanation is that the short sellers were forced into a "short squeeze" corner where they all had to buy stocks at the same time to cover the shares they borrowed last summer...and that is causing the price to jump.

Bet it comes down over the next few weeks.

Man some folks got burned very very badly on this.

If only I'd been brave enough to put all my cash in buying stock at $178. But you know what? I would have sold way before now anyway. Mind games!

Submitted by Coronita on February 5, 2020 - 6:19am.

svelte wrote:
Holy freakin christ I hope nobody on here actually shorted Tesla...they were up to $961/share at 3:30 today!

From a low of $178/share on June 3, 2019!

What rational reason can there be for that?

Sure they showed a profit and it looks like the tide may be turning for them, but let's get real here!

I think the most logical explanation is that the short sellers were forced into a "short squeeze" corner where they all had to buy stocks at the same time to cover the shares they borrowed last summer...and that is causing the price to jump.

Bet it comes down over the next few weeks.

Man some folks got burned very very badly on this.

If only I'd been brave enough to put all my cash in buying stock at $178. But you know what? I would have sold way before now anyway. Mind games!

If they did, they won't admit it. The folks that shorted AMD when it was single digits got burned even worse.

It's my opinion that the people predicting a stock market crash because we are close to the end of a bubble .... are dead wrong. I think we are just at the 2nd inning of a bubble-licious rally. That coronavirus did a pretty good job to wack 600+pt+ off the dow, but that seems to have been a panic selloff. And looking over the period of MERS and SARS, the US markets didn't tank during those periods of time, and SARS was arguably as detrimental to China . It just doesn't feel right. People are hyped up about Tesla, and Apple, and AI, and people have bought into the recovery story of now more value-ish plays like GE and Boeing . I wouldn't be surprised for most of this coronavirus influenced mini correction to be made back over the next few days provided that the coronavirus turns out to be what people think it is: mainly a problem for China.....And from an international trade perspective, this might actually be good. China is basically dropping tariffs on anti-virus drugs because they need all the help they can get, so it seems logical that pharma and biotech might actually rally at this point. Meanwhile, there was a lot of capital flight from the Chinese markets over the past few days. I seriously doubt all that capital is going to be camping out in gold and bonds and bitcoin. Gold, for example, didn't rally to the extent that people in the D&G (doom and gloom) category thought it would. It didn't even touch $1600/ounce when the virus panic started and now, were back down to $1560/ounce, despite Chinese inherently loving gold. So where did all that money go??? I suspect to the US equity markets. I wouldn't be surprised if we rally back. Yes, there will be a few companies that will say their business is impacted by a new economic weakness in China from the virus (a convenient excuse), but it won't be a problem across all companies. If we have a virus outbreak here in the US, then that could be a problem. But imho, even if we do, I don't think it would be worse than the influenza. Just my opinion, it's the wrong time to short. Not yet. For me, with that 600 pt drop, I moved a small previously cash position back into the markets. I think we'll see this rally back in the short term. The dow was back up 400+ yesterday. I'm just drawing on my prior experience from the dot.com days...if one thinks it's similar, it feels like things are just getting started. That tesla doubling in price is a prime example. The unicorns (which tesla is one) usually starts moving in doubling tripling in price...And then those main unicorns get exhausted in price movement, the lesser more questionable unicorns start to rally massively too for no reason...Also we haven't seen a flood of IPOs from less than stellar unicorn companies from the Bay Area. My litmus test is when companies like Chewy starts to rally the way WebVan and pets.com or etoys did. We simply aren't there...yet...

The good news is oil. maybe time to get in too

Submitted by Coronita on February 5, 2020 - 9:29am.

Dow was up 400 yesterday, up 265 today. That puts it above the pre-coronavirus one day 600 pt drop. So like I said, the coronavirus is probably a non event for US markets...unless we have a major outbreak here.

Impeachment is off the table now too. And Bernie and Warren looks like are trailing, so that's good news for Wall Street.

Submitted by spdrun on February 5, 2020 - 9:33am.

Bernie is within 1% of the Buttigieg, and that's in Iowa where he's a local/midwestern guy. Sanders is leading nationally -- hope he wins and puts Wall Street back in its place in the netherworld.

Submitted by Coronita on February 5, 2020 - 9:34am.

spdrun wrote:
Bernie is within 1% of the Buttigieg, and that's in Iowa where he's a local/midwestern guy.

yeah, but kinda surprised Buttigieg did so well.

Anyway, Bernie win is almost guaranteed another 4 years of Trump.

Submitted by spdrun on February 5, 2020 - 9:37am.

Bernie needs to hire good psychologists to figure out how to push Trump into a senile meltdown during a debate ... it could be fun to watch. Actually, all of the Democrat candidates should be looking at that option.

Submitted by Coronita on February 5, 2020 - 9:41am.

The Democrats tried that, but the thing is it's just making Democrats look even worse like a disorganized bunch of idiots. What Democrats need to do is get rid of the fringy left candidates and narrow it down to 2 candidates. Even so, they are running at a huge disadvantage. The economy for practical considerations is doing well, people feel their retirement accounts are doing well, and it's unlikely any of that will change in time before November. History favors the encumbent.

It doesn't matter anyway for individuals who's main investment strategy is a slow DRIP style investment into indexes. Then all of this meaningless over the longer period. DRIP style investment has consistently outperformed in my portfolio that speculation.

Submitted by spdrun on February 5, 2020 - 9:46am.

Trump isn't getting any younger and his dementia isn't getting any better.... keep trying.

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