FOMO - TESLA

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pennylane
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FOMO - TESLA

Post by pennylane » Tue Feb 18, 2020 5:42 pm

Felt the need to get on here and get some conventional wisdom from my opinion one of the best investment advice forums.

My story: I picked up an undisclosed amount of Tesla at around $200/share and sold all for close to $800/share in a timespan of less than 1 year.

My rational self tells me, nice job you made a profit, stick to the course and keep it moving never looking back at TSLA again. My irrational self is having a bit of FOMO and thinks I may of pulled out too early.

I know you can’t time the market, and I have 90% of my investible assets in SP/bonds and typically will contribute 1-5% on gambling on single stocks.

Someone please talk me out of rebuying into Tesla.

Thesaints
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Re: FOMO - TESLA

Post by Thesaints » Tue Feb 18, 2020 5:43 pm

How much did you make by selling at $800 ? Was that sum good enough for you ? If so, why would you want to gamble again ? If not, why did you sell at $800 ?

Bmac
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Location: Seattle

Re: FOMO - TESLA

Post by Bmac » Tue Feb 18, 2020 5:45 pm

Maybe next time an individual stock goes up 400%, sell 25-50% and let the rest sit.

Normchad
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Re: FOMO - TESLA

Post by Normchad » Tue Feb 18, 2020 5:49 pm

Don’t buy it. You got very lucky. There was no skill involved. You’re a fool if you think you can do that again.

I’ve got some, but I bought it lower than where it is now. I love Tesla. I own one and I love it.

The smart money is in owning the entire market, and doing it for a very long time.

I’ve seen a lot of people waste a decade of their investment timeline picking sticks and chasing big returns. That lost decade is really a missed opportunity to double their portfolio one more time before retiring.

They’d be much better off if they just bought VTI and never thought about it again. That’s my advice for you.

TomCat96
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Re: FOMO - TESLA

Post by TomCat96 » Tue Feb 18, 2020 5:51 pm

I just read an article on zerohedge pointing out Morgan Stanley's worst case and best case scenario valuation has a 900 dollar spread.

You're just gambling at this point. You were gambling before.
The entire world is watching Tesla. Seriously, Elon Musk himself has said its the most shorted stock in the world.

There are times when the market is efficient, and there are times when it is inefficient. The basic rule is the more eyes you have on something the more efficient it is. Everyone and their mom, their grandma and dog have done or are doing financial analysis on Tesla. Every bank has an opinion on it. Seekingalpha articles litter the field.

Morgan Stanley's analysis is exactly on point.

Best case scenario, 1200 a share. Worst case scenario 220 dollars a share. Don't dismiss the analysis. Take it at face value first. What does it tell you?

It tells you for all the analysis, nobody knows.
Hell with that kind of spread I could be a stock analyst too. Best case scenario it goes up 50% worst case it drops 50%. Tomcat96. Now someone give me my bonus.

pesos
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Re: FOMO - TESLA

Post by pesos » Tue Feb 18, 2020 5:55 pm

I picked up 50k of a different winner that quadrupled plus another 250k halfway up so doubled that. We got lucky and certainly don't expect to do so again.

Theseus
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Re: FOMO - TESLA

Post by Theseus » Tue Feb 18, 2020 6:20 pm

pennylane wrote:
Tue Feb 18, 2020 5:42 pm
Felt the need to get on here and get some conventional wisdom from my opinion one of the best investment advice forums.

My story: I picked up an undisclosed amount of Tesla at around $200/share and sold all for close to $800/share in a timespan of less than 1 year.

My rational self tells me, nice job you made a profit, stick to the course and keep it moving never looking back at TSLA again. My irrational self is having a bit of FOMO and thinks I may of pulled out too early.

I know you can’t time the market, and I have 90% of my investible assets in SP/bonds and typically will contribute 1-5% on gambling on single stocks.

Someone please talk me out of rebuying into Tesla.
If it makes you feel better, I wish I had bought TSLA. I have owned Model X for 2.5 years and I absolutely love the car. I have missed opportunity to buy stocks of the products/service I (and everyone around me) absolutely love or use frequently. Examples are Amazon, Apple (after iPhone came out), Facebook. Should have invested in them. Since I am in index fund investor and don't buy individual stocks, I passed on them.

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1789
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Re: FOMO - TESLA

Post by 1789 » Tue Feb 18, 2020 6:26 pm

Maybe two things:

1) Just don't look at stocks for a while, and then you will see that it will be much lower than 800$. Give it couple months. You will thank yourself.

2) Assume we are in a recession next month and what will happen to Tesla. Maybe it will go down to 80$?
"My conscience wants vegetarianism to win over the world. And my subconscious is yearning for a piece of juicy meat. But what do i want?" (Andrei Tarkovsky)

Topic Author
pennylane
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Re: FOMO - TESLA

Post by pennylane » Tue Feb 18, 2020 6:28 pm

1789 wrote:
Tue Feb 18, 2020 6:26 pm
Maybe two things:

1) Just don't look at stocks for a while, and then you will see that it will be much lower than 800$. Give it couple months. You will thank yourself.

2) Assume we are in a recession next month and what will happen to Tesla. Maybe it will go down to 80$?
Very difficult to ignore the chatter around, everyone seems to be talking about TSLA!

pasadena
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Re: FOMO - TESLA

Post by pasadena » Tue Feb 18, 2020 6:29 pm

pennylane wrote:
Tue Feb 18, 2020 5:42 pm
Someone please talk me out of rebuying into Tesla.
It's not $200 anymore.

Unladen_Swallow
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Re: FOMO - TESLA

Post by Unladen_Swallow » Tue Feb 18, 2020 6:30 pm

You might make tons of money again.
You might lose tons.

If you are okay with either outcome, go ahead and do it.

I am of the opinion that when someone asks to be talked out of something, they have already made up their mind. And now the onus is on strangers to take responsibility for his/her actions. I don't subscribe to that.
"I think it's much more interesting to live not knowing than to have answers which might be wrong." - Richard Feynman

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1789
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Re: FOMO - TESLA

Post by 1789 » Tue Feb 18, 2020 6:31 pm

pennylane wrote:
Tue Feb 18, 2020 6:28 pm
1789 wrote:
Tue Feb 18, 2020 6:26 pm
Maybe two things:

1) Just don't look at stocks for a while, and then you will see that it will be much lower than 800$. Give it couple months. You will thank yourself.

2) Assume we are in a recession next month and what will happen to Tesla. Maybe it will go down to 80$?
Very difficult to ignore the chatter around, everyone seems to be talking about TSLA!
I understand you but please remember what happens when everyone wants the same thing. Always ends with disappointment. History is the proof. Do you want to own a stock which goes 20% a day and then comes down 20% next day? How does this make any sense ? Your logic knows what is right thing to do. Don't let your emotions to take over your logic. Stay with Bogleheads :)
"My conscience wants vegetarianism to win over the world. And my subconscious is yearning for a piece of juicy meat. But what do i want?" (Andrei Tarkovsky)

stocknoob4111
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Re: FOMO - TESLA

Post by stocknoob4111 » Tue Feb 18, 2020 8:18 pm

the company's valuation and stock price is a joke... TSLA has not been profitable for 4 contiguous quarters even once in it's entire existence - the stock price reflects an extreme bubble based on speculation about the future and nothing more. We will see what happens when Q1 2020 earnings come out, it's going to be great to watch the stock get clobbered.

If we hit a recession I would wager that Tesla goes bankrupt since recessions are not kind to the auto industry and a niche manufacturer selling luxury cars in a space with a market penetration in the single digits is going to be wiped out in a hurry, not to mention the government is not going to bail it out like they did Ford or GM. Good luck to the gamblers.

Also, I had read an interesting article on the real reasons other car makers are not getting into the EV space, it's not because they are unable to compete with TSLA, it's because they cannot make money in that area... at the moment EVs are just not profitable.
Last edited by stocknoob4111 on Tue Feb 18, 2020 8:23 pm, edited 3 times in total.

Dave55
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Re: FOMO - TESLA

Post by Dave55 » Tue Feb 18, 2020 8:20 pm

pennylane wrote:
Tue Feb 18, 2020 6:28 pm
1789 wrote:
Tue Feb 18, 2020 6:26 pm
Maybe two things:

1) Just don't look at stocks for a while, and then you will see that it will be much lower than 800$. Give it couple months. You will thank yourself.

2) Assume we are in a recession next month and what will happen to Tesla. Maybe it will go down to 80$?
Very difficult to ignore the chatter around, everyone seems to be talking about TSLA!
Those who tell don't know, and those who know don't tell. (This refers to the best stocks to buy).

I know a lot of people who are not talking about Tesla.


Dave

Triple digit golfer
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Re: FOMO - TESLA

Post by Triple digit golfer » Tue Feb 18, 2020 8:24 pm

Why would you want to buy something that is 4x more expensive than it was a short time ago?

phantom0308
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Re: FOMO - TESLA

Post by phantom0308 » Tue Feb 18, 2020 8:37 pm

TomCat96 wrote:
Tue Feb 18, 2020 5:51 pm
I just read an article on zerohedge pointing out Morgan Stanley's worst case and best case scenario valuation has a 900 dollar spread.

You're just gambling at this point. You were gambling before.
The entire world is watching Tesla. Seriously, Elon Musk himself has said its the most shorted stock in the world.

There are times when the market is efficient, and there are times when it is inefficient. The basic rule is the more eyes you have on something the more efficient it is. Everyone and their mom, their grandma and dog have done or are doing financial analysis on Tesla. Every bank has an opinion on it. Seekingalpha articles litter the field.

Morgan Stanley's analysis is exactly on point.

Best case scenario, 1200 a share. Worst case scenario 220 dollars a share. Don't dismiss the analysis. Take it at face value first. What does it tell you?

It tells you for all the analysis, nobody knows.
Hell with that kind of spread I could be a stock analyst too. Best case scenario it goes up 50% worst case it drops 50%. Tomcat96. Now someone give me my bonus.
Zero hedge is also the site that’s been saying the stock market will crash and people will turn to bartering with silver and canned goods at least since 2012. The best thing I did for my financial health was to stop reading their conspiracy theory nonsense.

renue74
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Re: FOMO - TESLA

Post by renue74 » Tue Feb 18, 2020 8:45 pm

For about 5 years, I've watched the market daily and track my portfolio in a Google spreadsheet.

But...I got really busy in Q4 of 2019 on some other projects. I was flipping a house with a hard deadline and I just didn't follow my portfolio or the market.

Didn't really get back on it until late January...and didn't really care. Portfolio changed a little with dividends, etc. at the end of 2019...but I didn't worry.

If you focus on other things that make you happy, you'll not care about Tesla. After all, time is your largest asset.

sambb
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Re: FOMO - TESLA

Post by sambb » Tue Feb 18, 2020 9:00 pm

I am an index fund investor. That being said, i find it funny when people say "its all priced into the market". If that was the case, tesla wouldnt have taken off so quickly. Same went for apple. I remember seeing lines of people standing in line for the first iphone. meanwhile analysts on wall street were walking around with blackberries and Ballmer laughed at the iphone (find the video). The iphone was NOT priced into the market, becuase the market was determined by a majority of people that collectively misread it. Despite the rare gems and big profits, so what. You did well, and it all depends on one's goals. For every tesla or apple, there are others that lost a lot of money. However, the logic is totally off - if indexing is the right way to go, then why do threads on wellington or wellesley (or berkshire hathaway) seem acceptable, but tesla, or apple, or a fidelity fund of some sort, isnt acceptable? There are paradoxes all over the place.

If you feel like you can make money by stock picking, then go for it. You might be better than the index funds, you might not. Only time will tell. However, the majority of people cannot beat the market. Some, however, do beat the market. Whether it is luck or skill, applies to you and Warren Buffet and wellington, and many others.

I believe that most people cannot beat the indexes. However some might be able to, but Im not going to bank on that for me.

Topic Author
pennylane
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Re: FOMO - TESLA

Post by pennylane » Tue Feb 18, 2020 10:37 pm

stocknoob4111 wrote:
Tue Feb 18, 2020 8:18 pm
the company's valuation and stock price is a joke... TSLA has not been profitable for 4 contiguous quarters even once in it's entire existence - the stock price reflects an extreme bubble based on speculation about the future and nothing more. We will see what happens when Q1 2020 earnings come out, it's going to be great to watch the stock get clobbered.

If we hit a recession I would wager that Tesla goes bankrupt since recessions are not kind to the auto industry and a niche manufacturer selling luxury cars in a space with a market penetration in the single digits is going to be wiped out in a hurry, not to mention the government is not going to bail it out like they did Ford or GM. Good luck to the gamblers.

Also, I had read an interesting article on the real reasons other car makers are not getting into the EV space, it's not because they are unable to compete with TSLA, it's because they cannot make money in that area... at the moment EVs are just not profitable.
You bring up some excellent points. However, owning a Tesla and having drove other cars, it’s really not like anything else. I can’t see this company going bankrupt, the product is just too good. One side of me is thinking I could see this hitting 300-500B market cap and the other side could see this going back to 40B market cap similar to other auto manufacturers. I’m fairly certain I will sit in the sidelines for now, but it’s very difficult.

Topic Author
pennylane
Posts: 256
Joined: Thu Apr 12, 2018 10:22 am

Re: FOMO - TESLA

Post by pennylane » Tue Feb 18, 2020 10:42 pm

sambb wrote:
Tue Feb 18, 2020 9:00 pm
I am an index fund investor. That being said, i find it funny when people say "its all priced into the market". If that was the case, tesla wouldnt have taken off so quickly. Same went for apple. I remember seeing lines of people standing in line for the first iphone. meanwhile analysts on wall street were walking around with blackberries and Ballmer laughed at the iphone (find the video). The iphone was NOT priced into the market, becuase the market was determined by a majority of people that collectively misread it. Despite the rare gems and big profits, so what. You did well, and it all depends on one's goals. For every tesla or apple, there are others that lost a lot of money. However, the logic is totally off - if indexing is the right way to go, then why do threads on wellington or wellesley (or berkshire hathaway) seem acceptable, but tesla, or apple, or a fidelity fund of some sort, isnt acceptable? There are paradoxes all over the place.

If you feel like you can make money by stock picking, then go for it. You might be better than the index funds, you might not. Only time will tell. However, the majority of people cannot beat the market. Some, however, do beat the market. Whether it is luck or skill, applies to you and Warren Buffet and wellington, and many others.

I believe that most people cannot beat the indexes. However some might be able to, but Im not going to bank on that for me.
I am an index fund investor and do not believe I pose any special skill or insight to be able to beat the market. I do have about 5% give or take set on side for occasional stocks that seem like no brainers - Tesla at $200 seemed like a no brainer to me which is why I jumped in. But at the end of the day it was a gamble. The question is, did I pull out too early or was it a good decision. Hard to tell.

mhalley
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Re: FOMO - TESLA

Post by mhalley » Tue Feb 18, 2020 10:48 pm

Many if the auto companies are starting to make evs. It’s only a matter of time until they come out with ones that are almost as good as Tesla’s but are cheaper. When that happens, Tesla will probably be bought by a big auto co and it’s tech incorporated. That’s only my opinion, and I have no idea if I’m right. Betamax was much better than vhs, but lost out.

Elysium
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Re: FOMO - TESLA

Post by Elysium » Tue Feb 18, 2020 11:16 pm

pennylane wrote:
Tue Feb 18, 2020 10:37 pm
stocknoob4111 wrote:
Tue Feb 18, 2020 8:18 pm
the company's valuation and stock price is a joke... TSLA has not been profitable for 4 contiguous quarters even once in it's entire existence - the stock price reflects an extreme bubble based on speculation about the future and nothing more. We will see what happens when Q1 2020 earnings come out, it's going to be great to watch the stock get clobbered.

If we hit a recession I would wager that Tesla goes bankrupt since recessions are not kind to the auto industry and a niche manufacturer selling luxury cars in a space with a market penetration in the single digits is going to be wiped out in a hurry, not to mention the government is not going to bail it out like they did Ford or GM. Good luck to the gamblers.

Also, I had read an interesting article on the real reasons other car makers are not getting into the EV space, it's not because they are unable to compete with TSLA, it's because they cannot make money in that area... at the moment EVs are just not profitable.
You bring up some excellent points. However, owning a Tesla and having drove other cars, it’s really not like anything else. I can’t see this company going bankrupt, the product is just too good. One side of me is thinking I could see this hitting 300-500B market cap and the other side could see this going back to 40B market cap similar to other auto manufacturers. I’m fairly certain I will sit in the sidelines for now, but it’s very difficult.
Don't see the sales becoming massive enough to justify the stock valuation. It will sell enough cars, but will end up becoming just another very successful car manufacturer like many others. Just a matter of time before Toyota goes all EV with the current Plug-in Prius. Tesla is a niche product and at the very best become a more common product, but that's about it. Stock price will need to come down.

Elysium
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Re: FOMO - TESLA

Post by Elysium » Tue Feb 18, 2020 11:24 pm

pennylane wrote:
Tue Feb 18, 2020 5:42 pm
Felt the need to get on here and get some conventional wisdom from my opinion one of the best investment advice forums.

My story: I picked up an undisclosed amount of Tesla at around $200/share and sold all for close to $800/share in a timespan of less than 1 year.

My rational self tells me, nice job you made a profit, stick to the course and keep it moving never looking back at TSLA again. My irrational self is having a bit of FOMO and thinks I may of pulled out too early.

I know you can’t time the market, and I have 90% of my investible assets in SP/bonds and typically will contribute 1-5% on gambling on single stocks.

Someone please talk me out of rebuying into Tesla.
If you were actually owning a true 10 bagger stock like Peter Lynch used to call them, then you wouldn't actually know it until it really become successful, and that will happen when no one is expecting over a period of time. Everyone thinks TSLA is a great story and thinks it is going to be that successful, so it isn't likely to be a 10 bagger at this time. More likely people who buy at this price will see no gains or almost very little gains, perhaps double in a few years if everything goes perfect. On the flip side, could lose a lot.

MotoTrojan
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Re: FOMO - TESLA

Post by MotoTrojan » Tue Feb 18, 2020 11:25 pm

You timed this perfectly. Move on.

valueashram
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Re: FOMO - TESLA

Post by valueashram » Wed Feb 19, 2020 12:12 am

pennylane wrote:
Tue Feb 18, 2020 10:37 pm
You bring up some excellent points. However, owning a Tesla and having drove other cars, it’s really not like anything else. I can’t see this company going bankrupt, the product is just too good. One side of me is thinking I could see this hitting 300-500B market cap and the other side could see this going back to 40B market cap similar to other auto manufacturers. I’m fairly certain I will sit in the sidelines for now, but it’s very difficult.
A company with an amazing product can blow up. I don't disagree about the product, it is amazing. But there are many other risks a company like Tesla faces. Additionally Tesla does not need to go bankrupt for investors to lose most of their money. I like to own some individual stocks in my portfolio but this is not one of them. There is no way for me to even have a reasonable guess at how this plays out.

To the OP,
When dealing with FOMO, don't forget the upside of sitting out. You will also "miss out" on the drawdowns and volatility. That is worth something :) If you had ridden AMZN from the IPO to todays greater than 100,000% return you would have held through multiple >90% drawdowns. Yes that is right multiple times your position would have dropped over 90%. Most people can't hold positions through that.

Lets just say for a second that Tesla is a grand slam over the next 20 years like AMZN. It seems highly likely we see massive drawn downs on the ride up. And there will be very few people on the planet who were able to hold through thick and thin to capture those returns.

stocknoob4111
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Re: FOMO - TESLA

Post by stocknoob4111 » Wed Feb 19, 2020 10:48 am

going to the moon and today... is $1000 imminent??

Topic Author
pennylane
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Re: FOMO - TESLA

Post by pennylane » Wed Feb 19, 2020 11:21 am

stocknoob4111 wrote:
Wed Feb 19, 2020 10:48 am
going to the moon and today... is $1000 imminent??
:oops:

Texanbybirth
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Re: FOMO - TESLA

Post by Texanbybirth » Wed Feb 19, 2020 11:23 am

Just buy some more of the stock with your play money. It could be a good lesson, either way.
Old Tom Bombadil is a merry fellow, | Bright blue his jacket is, and his boots are yellow. | None has ever caught him yet, for Tom, he is the master: | His songs are stronger songs, and his feet are faster.

atdharris
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Re: FOMO - TESLA

Post by atdharris » Wed Feb 19, 2020 11:40 am

I would not touch Tesla at this point. Its price action is totally disconnected from its fundamentals. I am shocked that it has held up through its short squeeze like it has.

3funder
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Re: FOMO - TESLA

Post by 3funder » Wed Feb 19, 2020 11:48 am

Listen to your rational self. You made 4x your initial investment in a short period of time. I would find it pretty difficult to feel like I missed out on anything. One more thing: I do not invest in individual stocks, but if I did, it would not be in an automobile manufacturer.

tesuzuki2002
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Re: FOMO - TESLA

Post by tesuzuki2002 » Wed Feb 19, 2020 11:53 am

pennylane wrote:
Tue Feb 18, 2020 5:42 pm
Felt the need to get on here and get some conventional wisdom from my opinion one of the best investment advice forums.

My story: I picked up an undisclosed amount of Tesla at around $200/share and sold all for close to $800/share in a timespan of less than 1 year.

My rational self tells me, nice job you made a profit, stick to the course and keep it moving never looking back at TSLA again. My irrational self is having a bit of FOMO and thinks I may of pulled out too early.

I know you can’t time the market, and I have 90% of my investible assets in SP/bonds and typically will contribute 1-5% on gambling on single stocks.

Someone please talk me out of rebuying into Tesla.

You only sell what you had into it... Get your investment back and let the profits ride!!

manatee2005
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Re: FOMO - TESLA

Post by manatee2005 » Wed Feb 19, 2020 11:56 am

stocknoob4111 wrote:
Tue Feb 18, 2020 8:18 pm
the company's valuation and stock price is a joke... TSLA has not been profitable for 4 contiguous quarters even once in it's entire existence - the stock price reflects an extreme bubble based on speculation about the future and nothing more. We will see what happens when Q1 2020 earnings come out, it's going to be great to watch the stock get clobbered.

If we hit a recession I would wager that Tesla goes bankrupt since recessions are not kind to the auto industry and a niche manufacturer selling luxury cars in a space with a market penetration in the single digits is going to be wiped out in a hurry, not to mention the government is not going to bail it out like they did Ford or GM. Good luck to the gamblers.

Also, I had read an interesting article on the real reasons other car makers are not getting into the EV space, it's not because they are unable to compete with TSLA, it's because they cannot make money in that area... at the moment EVs are just not profitable.
Didn’t you get the memo? All future recessions have been canceled :-)

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Ramjet
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Re: FOMO - TESLA

Post by Ramjet » Wed Feb 19, 2020 11:56 am

You already bought them and won...next

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4nursebee
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Re: FOMO - TESLA

Post by 4nursebee » Wed Feb 19, 2020 11:56 am

atdharris wrote:
Wed Feb 19, 2020 11:40 am
I would not touch Tesla at this point. Its price action is totally disconnected from its fundamentals. I am shocked that it has held up through its short squeeze like it has.

What if the price action is due to the fundamentals?
Pale Blue Dot

Monster99
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Re: FOMO - TESLA

Post by Monster99 » Wed Feb 19, 2020 12:12 pm

Musk will most likely selloff the automotive area and concentrate on the battery production - much more potential...😁

Anon9001
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Re: FOMO - TESLA

Post by Anon9001 » Wed Feb 19, 2020 12:21 pm

It is a typical high beta stock which is very likely to be over-valued. The existence of the low volatility premium should disaude you from investing in it.
Here are the results of SPHB a ETF that holds S&P 500 stocks with highest Beta ie Stocks like Tesla compared to S&P 500:
https://www.portfoliovisualizer.com/bac ... ion2_2=100

12.79% CAGR for VFINX compared to 8.53% CAGR for SPHB.

effigy98
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Re: FOMO - TESLA

Post by effigy98 » Wed Feb 19, 2020 12:34 pm

Maybe diversify into ARK funds (https://ark-funds.com/) if you suffer from FOMO and let someone else do the trades more systematically.

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