
Tesla short sellers lose $1B - kerng
https://www.cnbc.com/2018/06/08/tesla-shares-to-pop-42-percent-as-model-3-profits-improve-with-musk-looking-to-china-analyst.html
======
Jugurtha
Can people in finance and analysts start using stagger charts[0], please?
Making predictions and not keeping score of predictions is useless. That's
exactly what tarot readers do.

In the left column the months (or years or days) you make the predictions
_in_. Top months are the months you're making the predictions _for_. The trace
(R) is the actual real value (forecast of January in January, i.e: you have
the number).

So:

The forecast for October made in January is 22.

The forecast for October made in June is 13.

The forecast for October made in September is 42.

This way, we can track all forecasts and track errors. The chart has memory.
The chart cuts through bullshit.

    
    
            J   F   M   A   M   J   J   A   S   O   N   D
    
      J     R   12  13  14  53  12  21  34  19  20  22  19
      F     -   R   14  13  51  10  20  30  17  22  24  15
      M     -   -   R   51  11  27  35  19  20  21  19  12
      A     -   -   -   R   55  17  20  32  18  21  28  19
      M     -   -   -   -   R   73  42  11  34  17  23  12
      J     -   -   -   -   -   R   61  21  67  13  22  82
      J     -   -   -   -   -   -   R   42  11  34  17  23
      A     -   -   -   -   -   -   -   R   42  11  34  17
      S     -   -   -   -   -   -   -   -   R   42  11  34
      O     -   -   -   -   -   -   -   -   -   R   42  11
      N     -   -   -   -   -   -   -   -   -   -   R   12
      D     -   -   -   -   -   -   -   -   -   -   -   R
    
    

[0]: _High Output Management_ \- Andrew Grove

~~~
tim333
> Making predictions and not keeping score of predictions is useless.

Perhaps but I think you may misunderstand how these things work. "Nomura
Instinet advising clients that the electric car maker's shares could rally 42
percent over the next year." is a sales pitch for people to become clients of
Nomura and trade stuff. They have no interest in any one keeping score of
their predictions. It's like "England may win the FA cup, place your bets with
Ladbrokes" \- not really about testability.

------
std_throwaway
The market doesn't follow the news. The news follows the market. If it's on TV
it's already too late.

~~~
sublimino
Perhaps counterintuitively (in British English at least) the noun news is
uncountable (e.g. referring to a mass rather than something that can be
counted), and is singular in grammatical construction (so cannot be
pluralised).

[https://dictionary.cambridge.org/grammar/british-
grammar/unc...](https://dictionary.cambridge.org/grammar/british-
grammar/uncountable-nouns/news)

~~~
std_throwaway
Thanks.

------
anoncoward111
The time to short was months ago, to be honest. Reversing the news is always a
good strategy [1]

[1] unless it's news about Sears

~~~
std_throwaway
If there's enough money believing in the company the stock price doesn't
really matter. They will hold as long as they believe the company has a chance
to pay out (far) in the future. It's less a publicly traded stock and more a
long term investment.

~~~
Xcelerate
> It's less a publicly traded stock and more a long term investment

I thought that was kind of the original point of stock.

~~~
std_throwaway
The point is a lower barrier of entry because anyone can just buy your stock
and therefore a larger pool of potential investors. The downside is that the
mass of those investors (on average) are not as well informed as a few select
big investors. This gave Tesla a great amount of money to work with as long as
their star was shining but now it could backfire badly.

------
astrodev
Is this the "short burn of the century" that Musk predicted at the beginning
of May?
([https://twitter.com/elonmusk/status/992388944774938626](https://twitter.com/elonmusk/status/992388944774938626))

~~~
toomuchtodo
It’s the beginnings of it. Keep an eye on the price of deep out of the money
calls on TSLA between $340-$380 to see what the market is predicting as we get
closer to the next earnings call.

~~~
marketgod
We need to break $330~ on TSLA with power

------
iblaine
Reminds me of Bill Ackman's bet against Herbalife.

------
anjc
It's still in the same downward channel

~~~
std_throwaway
The company itself seems to be in a downward spiral getting hit from multiple
sides. To me it's unclear if they'll make it.

~~~
toomuchtodo
Can you provide a citation? If they make their 5k/week production target by
the end of this month (which it looks like they will), they’re on their way to
being cash flow positive, and also not needing another capital raise in the
near term.

Challenges for sure, but “downward spiral”? Hyperbole.

~~~
Judgmentality
I am not sure why you think it's likely they'll hit 5k/week by the end of the
month, considering Musk has been promising that for the better part of a year
now. I admittedly do not know enough about the financials to know if that will
truly make them cash flow positive, but even if it does they still have to pay
back over $1 billion in debt at the beginning of 2019.

Tesla is going to need to raise more money in less than a year (probably less
than 6 months). If you truly don't believe that, I will happily take a bet.

~~~
toomuchtodo
Based on Musk’s track record, he delivers. Late? Sure. But always delivers.

Disclaimer: TSLA investor with extremely high limit order set in order to
prevent my shares from being lent to short sellers

~~~
ptsch
How does high limit order prevents your shares from being lent out?

~~~
toomuchtodo
It ties the shares up as an open order.

[https://www.quora.com/Is-it-true-that-putting-a-high-
limit-s...](https://www.quora.com/Is-it-true-that-putting-a-high-limit-sell-
order-will-prevent-shorts-from-borrowing-your-shares)

~~~
ptsch
This link does not provide evidence that it would prevent broker from lending
out your shares. This “lock” is only placed internally in the broker’s
internal system, there is nothing preventing the broker from lending out your
share anyway. If they can’t get your shares back in time before your order
triggers then they would just compensate you.

Where did you get this idea from, anyway?

~~~
toomuchtodo
I confirmed it with my broker. They answer any questions I might have pretty
quickly.

------
n1231231231234
maybe it's narrow minded, but for me, investing is all about giving a company
mid- to longterm support so that they can expand their business. shorting is
none of that. it doesn't create any value for society at large. if anything,
it is, imv, close to professional gambling. but even gambling isn't this
destructive. that's why i have zero empathy for those who lose money from
shorting.

~~~
hsienmaneja
Purchasing common stock after an offering (I.e. on the open market) doesn’t do
anything to support a company, either. It’s essentially just paper being
traded back and forth.

~~~
TheSoftwareGuy
But having the ability to liquidize their stake at almost any time makes it
easier for investors to put money into the company, and therefore gets more
investors on board.

------
stevievee
Do not bet against Tesla unless you are a professional. Tesla has incredible
PR and Finance departments with background proponents holding enough capital
to help them through rough patches. Side note, their Q2 2013 is still one of
my favorite Finance/PR plays in recent memory.

~~~
freerobby
Agree with the conclusion, disagree with the reasoning.

In the end, good products and strategies win. Betting against Tesla is dumb
because they've proven the doubters wrong about their products and strategies
over and over again. They've stayed right on course with the ten-year plan
they laid out ten years ago, and every product they've built has been loved by
an overwhelming majority of its owners. Not many companies can say that, not
even successful ones.

Short sellers need to tip their caps and recognize that Tesla understands what
it's doing better than they do. The longer it takes them to realize this, the
more money they're going to lose.

~~~
stevievee
They have yet to prove any of the doubters wrong with regard to the model 3,
sorry. Also, the stock is not traded on fundamentals as much as you or the
rest of the public believes.

~~~
freerobby
> They have yet to prove any of the doubters wrong with regard to the model 3,
> sorry.

There will always be an unproven next step. The point is that in each example
where we have a clear conclusion, the conclusion has been favorable for Tesla.
My money is on the Model 3 continuing this trend.

> Also, the stock is not traded on fundamentals as much as you or the rest of
> the public believes.

I never said (nor do I think) that the stock is traded on fundamentals.

~~~
stevievee
> There will always be an unproven next step.

This makes no sense in a trading environment. The reason that shortsellers are
hovering is because Tesla is trading at aggressive multiples with aggressive
business goals they show signs of missing. I'd like to see your "clear
conclusions" that the model 3 is succeeding.

> I never said (nor do I think) that the stock is traded on fundamentals.

Semantics at this point.

