You are not as clever as you think you are?

2nd Feb '20 by Tonysaparito

15 comments 1435 reads

Pauls Small Cap Report on Friday highlighted $TSLA TESLA.
His article about Tesla and his friends is shown below:

Tesla - The above reminds me of what's gone on with Tesla. A very heavily shorted, perennially loss-making company share has unexpectedly become a star performer, rising from around $250 to $640 in the last 3 months! The valuation is madness now, but it doesn't seem to matter. Although the company does now seem to be moving into profit, and production numbers are good. There's a ton of new competition being launched now, so it won't have the luxury electric car market to itself any more.
At least two of my friends were heavily shorting Tesla shares, and have suffered large losses. In both cases, they said the same thing to me (independently). One said, "I should have closed my short when the good production data came out" [which is what triggered the start of the huge rise].
The other friend said of his Tesla short, "I've got to learn when to throw in the towel, when I've got something wrong".
These are both highly experienced, very successful investors I should add. So behavioural flaws affect everyone, even the best investors. That's my thought for the day!.

I have American friends who own, drive and have years of experience of being a Tesla fan...I urge you to watch the Bloomberg Video on 01/31/20 posted on Youtube.
Put in the search box :Bloomberg Wall Street week..most of the 48 minutes is ok but fast forward to 39 minutes and listen to Cathie Wood, CEO, owner and founder Of Ark Investment Management and you will not be shorting Tesla anytime soon.

The interview with Cathie Wood is compelling and download Arks report for 2020 from their website.
I have no holdings in either Tesla or Ark, but I am going to put money into Tesla now, without any fear.

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Tonysaparito

2nd Feb '20

Please also read the excellent article previously written by Jmuggleton..

William K

3rd Feb '20

Thanks for your thoughts Tony. I think Tesla make a great car and I think they have a great future. (It's worth noting that Scottish Mortgage Trust (Scottish Mortgage Investment Trust (LON:SMT)) has had faith in them for a long time and been rewarded by a tripling of the share price over the last half year, so obviously they knew what they were doing.) The question today is whether or not this is a good time to invest. The share price is on a parabola, driven by FOMO and herd psychology, and will almost certainly fall by around 20% over the next six months, especially if there's any disappointment in the next quarter's figures. (As we all know there are no certainties in the stock market, only probabilities.) This would statistically be a better time to go short than long, but it would be a brave person who does either. Best bet might be a straddle. The price won't be static at $650 for long.

Mike888

Paul's comments are fair and balanced, it is not really on to create such an inflammatory headline.

MiserableJacktPotato

That's the Wood who's ArkInvest sold $30M of Tesla stock the other day, as she continues to pump it national US tv.

At best we can describe that as a conflict of interest....

See @TeslaCharts feed on Twitter for details of the transactions. I have not independently verified this information, please check it yourself. I have no position in Tesla but would love to be able to afford to short it - it's way too volatile.

dmjram

" I am going to put money into Tesla now, without any fear."

hhmm…you seem to be exhibiting the behavioural issues you flagged as being such an issue in others...

Well dmjram..I should qualify what I said..I am going to invest in Tesla but what I did not say is when....I intend to wait until we know much more about Coronavirus as clearly that is going to affect their Chinese operations.
The real point I was making though is Tesla divides opinion...I believe it’s technology is so far superior to other ICE manufacturers, it’s future is more certain.
Reports I have read suggest the ICE car will not exist for us as owners by 2030...we will all be using ride hailing cars to get around by 2030 and car dealerships, tyre depots and service centres for you and me , will be dinosaurs.
No car insurance, no fuel costs and no tax to pay...
Current manufactures are way behind the curve and that newish car which is costing billions of pounds per month to spend most of its time parked up , is not the future..
The future is Tesla cars owned or leased by ride hailing companies to transport you and me from A to B.
Read some of the stuff of how ride hailing is transforming travel in California ..in Tesla cars and you will see where the future is going...ICE cars are dead and it’s just they don’t know it yet
Tesla cars currently can run for 500,000 miles with only 80% battery degradation , then a new battery, at a lower price and another 500k , however, Tesla believe they will get to 1million miles soon before their cars need a new battery.
I will admit we could all be wrong but if Thomas W Phelps was around today ( 100 to 1 in the stock market) I wonder what he would make of Tesla.
If I was clever, which I am not , I would have got into Tesla @$30 but so would many others.
None of us are perfect and FOMO obviously is a big issue for all of us but to compare Tesla company valuations to ICE manufacturers is like comparing the my old 1970 s Ford Capri to Tesla from 2008 Tesla Roadster.
All of us know so much about so many things but around us are people and products , who are so advanced , we wish we that clever.’
The facts are there for all of us but Tesla divides opinion...those who own shares in Tesla will either get burned or make a fortune....Strong convictions and being prepared to take a position can sometimes be a lonely place ,but it’s not as difficult as you might imagine , when the facts are obvious...Tesla is light years ahead of its rivals and whilst there will be many bumps in the road , for long term holders of the stock , it’s going to be the next Apple or Amazon..its just a question of when

$30 million..If you held a stock which went up say 5 fold would you not top slice some of it to find the next Tesla?

Rusty2

Yes I have seen these reports as well but they also were saying nearly every new car would be electric by 2020, hmmm, SUVs outsell EVs in the UK at the moment, EVs are a very small proportion of new cars sales, I would not expect this to happen at least until 2040 and probably much later in UK. Problem with Tesla is they don’t have a hatchback for the European market and the infrastructure is not in place in the UK yet. How will future govt. raise tax if no fuel duty? I can see non ownership of cars working in some areas but in others, such as more rural ones, it will like trying to get a taxi or a bus now.

Not sure hat reports you have read ..but the reports I have read never suggested 'every new car would be electric by 2020'.
The issue of a hatchback or SUV is obviously an issue but sales of SUVs in Uk is based on manufacturers offering PCP that make the purchase of a SUV a no brainer , compared to saloons...however, BMW/Daimler Benz..are great cars but their badge appeal will only last as long as their price per month remails competitive.
When the price of Tesla, drops , as it will, and it gets anywhere near of an ICE , we will jump all jump ship.
Problem is still ..the crossover point is far closer than we think.
As for fuel duty, there will still be need for it but the ride hailng cars will be all electric and only the very rich will still be driving around in their ICE cars ...so the govt will have to get their tax somewhere else.
Petrol/diesel stations will still sell some fossil fuel but their main purpose will be charging points for all the electric cars.
As for rural areas , people will know when they want to travel to the supermarket, doctor etc l and they will book with other residents their trip in mini buses all powered by electric.
In rural France, every village has a Marie, or town hall, where motorhome owners can stay for the night, they all have electric hook ups and putting in more charging points will be a simple task , so wherever the EV is, it can charge...and in those circumstances , you might as a resident have an old ICE car but it will cost you a fortune to run...you will be better off owning a basic EV if you want a day out or people will join up in groups to buy an EV to share.
i have a cousin in rural France with 2 ICE cars, his neighbours the same, they have already discussed buying an EV between them and sharing the costs, as like I said before, their cars spent the vast majority of time standing still..they are just waiting for the price of an Ev to fall, when that point comes, sales of Evs will rocket.
Tesla, knows this and my guess is they will produce another mass market car at around £23,000, or less and offer fractional ownership for friends and neighbours.
Who would not want to own an EV.
On a side note, also in France there are an estimated 3million households, heating their homes with oil boilers, the French govt has stated those boilers have to be out by 2028, and are offering zero interest loans and in many cases no cost loans to certain households .
The important point with EVs and particularly Tesla, is the cost in £s is not going to be the big issue, the big issue in the reduction in CO2 emmissions, that will be a bigger driver than anything else and those who produce the most COs will be punished through their bank accounts .
Of course traditional ICE manufacturers will compete, but there will be far fewer of them than we have now, as consumers the choice of cars is too large and the consolidation in the sector will gather pace, at an alarming rate.

Bon chance investing in any stock without fear....

Not when you’re on National TV saying you have a $6000 target.

Like I said, at best it’s a conflict of interest. You shouldn’t be pumping a stock you’re actively selling...

Sharks of Wall St comes to mind ..but it's not just retail punters piling in, serious money is going in ....but the phrase that many will be saying is 'winners curse' if it is a bubble

4th Feb '20

The Tesla chart reminds me of the charts just before the Dot.com bubble burst in 1999-2000. People got carried away by new technology and ignored the fundamentals.

According to the FT, it seems the Tesla shorters are currently down around $9 billion and I suspect the bubble is caused by some panic buying back of shorted stock rather than new investors piling in - although there will naturally be a few of those.

As Keynes once said: The market can remain irrational a lot longer than one can remain solvent.

This is definitely something to watch from the side lines.

jurgen klopp

Going off at a slight tangent, but only because Cathie Wood and ARK are mentioned within this thread, one of the main areas where she sees huge scope (a quick watch of some of her Youtube videos will confirm) is in gene editing.

She sees huge potential in the share price of the three leading US listed companies but we also have a world leader fighting out of Cambridge, namely Horizon Discovery (LON:HZD)

Today, in addition to a trading update, the Company has announced plans for a proposed US public offering. It already has a large US shareholder in ValueAct (who were very active in getting Merlin Entertainment being taken over last year) and you can see Horizon getting more and more attention in America which can only be positive for the share price I would have thought.

13th Feb '20

I have just seen on the news that EV car sales in China are down 54% in January, it said subsidies have been cut. Overall new car sales are down 18%. This is before Coronavirus has had an impact. Many car plants are being shut down due to lack of parts from China.

You are not as clever as you think you are?

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Tonysaparito

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