“I can calculate the motions of the heavenly bodies, but not the madness of the people” - Isaac Newton, after getting poured out on stocks.
You’ve learned and learning is good. In a way that no one else has. You now have a real emotional connection to puts (or anything short-term). You’ll never buy them in the say way again. That’s a good thing.
Yea! Tesla down today!
Well it’s certainly good to see it knocked down a peg. I saw it was actually up 8 bucks in pre-market trading and I was like FFS, really? But then it dropped immediately when the market opened. I would assume pre-market trading being way up would mean the market would be up, but I don’t know - I guess the volume is so low that it’s not representative of how the market is going to open? Just a few buyers can jack the pre-market price up.
One thing that irks me a bit is that Tesla going up 20 bucks cost me a lot more portfolio value than it going back down 20 bucks. I think it’s because it’s calculating the value of my options contracts as part of the daily gain/loss and for whatever reason a lot of my puts lost 50-80% of their value when it spiked up but only regained like 30% of their value when it came back down. I’m not sure why that is – for the closer puts (like in the next couple of weeks) it may just be because there’s less time for the stock to move, but there shouldn’t be such a difference in the ones that are are 6 weeks out. But my portfolio is definitely down from where it was when Tesla was at this same price a few days ago.
As with bonds, the moment by moment value of options is immaterial if you’re holding them to maturity or strike date respectively. So if you’re watching your portfolio closely, it’s best to construct a total of the equities, ETFs, etc. that excludes your bonds and options, and plot that number instead.
Whether watching an investment (as opposed to trading) portfolio daily is smart or dumb is beyond the scope of this post.
You know what’s funny? Trump announced that cars made outside the US will have a 25% tariff. That should’ve boosted Tesla, but it lost like 7%. When they get awful news, it surges, when they get good news it crashes. Because everything is bizarro world with that stock.
Reports are that Tesla sales across Europe were down 50% YOY in february, which is catastrophic but not the $70%+ I was expecting. But I think the trend turned even worse against Tesla and the March numbers may hit that 70%+ mark.
I wonder if the announcement about 25% on foreign cars is designed to mostly prop up Tesla. I mean he did a commercial for Tesla at the white house, I’m sure he’d be willing to direct the tariffs at protecting his master. I’m a little concerned the 25% tariff announcement will send the stock soaring tomorrow again, though it didn’t today.
I’m trying not to make this a daily TSLA news thread.
“Liberation day” is Wednesday of next week. That’s the day Trump is going to liberate the US of being the most economically dominant and rich nation in teh world by kicking all his tariffs into high gear. Or not, maybe he’ll change his mind at the last minute. You know how the market loves uncertainty.
I’m going to reduce my short term gambling type bets but I feel like shorting the market on liberation day seems like kind of an obvious call. People will say it’s “priced in” but I really doubt it, it’s hard to price in anything if you don’t know what insane ramblings will actually become policy until they actually do.
The TSLA updates are illustrative of the spectrum to how we each approach markets, from the firm long term buy and hold, including index centered, to more active trading and speculating.
I have the disposition to wait out volatility but not the disposition you have to try to play it. More power to you!
I am afraid it is not that easy, and I have seen the stock exchange rebound heftily after the temper tanTrump in the White House did something less stupid than feared. Your strategy can be very lucrative if you hit it right, but it is very risky.
Mind you, I do the same, but only with a very small fraction of my investments. Going all in is playing with fire. But I wish you much success. Ideologically I agree with your approach.
I’ve been investing for about 10 years and I’ve been a normal buy and hold investor for almost all of that. It’s only recently with the imminent crash of the US economy and economic position in the world that made me take an interest in close management of my portfolio. Though, to be fair, the 10-15% of my portfolio I turned into personal hunches has always done pretty well, but that’s all been long term buy and hold too. I’m very new to all this short term stuff.
And once the chaos calms down I’ll probably go back to being mostly buy and hold, but probably in European stocks. Maybe one or two choice American stocks.
Do you think it has been worth it so far? I’m seriously interested. Being a buy and hold investor takes very little work. Slumps in the market are not a cause for dread, but actually ideal buying opportunities. My concern with the day to day movements of the market are minimal with a timeline of 10+ years until I will access my 401k. The daily whiplash of Tesla seems to have have preoccupied you in this thread, since you now have a large short term stake in it. Do you think the worry and daily monitoring has been worth it to you so far?
I agree completely … in markets that are not about to have their currency, their economy, or their very government implode.
Which has always been true in the USA since before any of us were born, but has failed to be true, with near 100% losses and no recovery of existing equities, in many other countries during your and my lifetime.
So which is our future when our clown car is driven by two madmen, one of whom is seemingly in thrall to Putin and the other of whom truly sees himself as the Earth’s first planetary emperor.
What have those countries bonds and currencies done when those collapses happened?
If something like that happens to the US markets I suspect there are few safe havens. It would bring down other markets with it. No currency would be secure.
They are telegraphing a recession, this time for real. Everyone is saying the growth is not there, etc. Someone needs to read on what Heritage people want to do, tech bros, or what oligarchs did in post USSR.
They don’t want any over arching, multi lateral interests, regulation etc.
I do not know what that relates to in a positive return other than to the private sector, very wealthy
It’s kind of hard to say. I try not to be too results-oriented in my decisions but in this case how I’m going to feel about it is almost entirely results oriented. If Tesla has the big crash that it absolutely should, I’m set up to benefit greatly. And while I would never trade the downfall of this country to make a buck, I have no choice – I’m forced along for the ride – and the idea of profiting off Elon Musk’s downfall is one of the few things that actually makes me feel a little less bad about the current situation.
I played poker professionally for over a decade and so I have a pretty high tolerance for throwing my money down on a bet and losing, so I’m not too upset over the rather large swings to my portfolio. But I’m kind of still working under the assumption that reality has to set in at some point and it honestly just may not. I may end up taking a loss on this and that would be frustrating – not only because it sucks to lose money but also that it makes NO SENSE AT ALL. Every rational thought indicates that Tesla is shit, but they’ve got a change to surge into being one of the top 10 most valuable companies in teh world again. It’s frustrating to see it succeed in spite of that, and in spite of how evil Elon is, and how much everyone hates him.
I’m not going to become a day trader or anything like that. I feel like this is a pivotal time to make a big play so I’m doing it, but I’ll settle down to much less management I’m sure. I kind of enjoy reading investment forums a bit and seeing what people think and making a play here and there, but they will be much more modest plays than how all-out I’m going on Tesla right now.
Generally the bonds of the old government are simply worthless. As to currencies depends on whether they had a bout of hyperinflation on the way to collapse. If hyperinflation, there may be a new currency where you can turn the old in at 10,000 or 1 million to 1. If that good. if no hyperinflation, there may be no exchange at all.
As to your second point:
If the US collapses, nowhere will be a “safe haven” that cruises merrily along earning a steady 5%.
But if the choice is between experiencing a 100% wipeout of your US-based USD-denominated wealth with no recovery, or a 50% worldwide depression followed by eventual growth again with all your wealth in Europe, Asia, and Latin America, well … I know which scenario I’d rather be in.
I am not certain our future is collapse. Else I’d not be wasting time typing here; I’d be busy emigrating and porting my money with me one way or the other.
But I do think anyone who’s just parroting the “buy and hold” / “it’s a routine correction” mantra isn’t looking at the big-enough picture.
Playing with alt futures - what is the basis of your concluding that complete US equity currency and bond collapse would result in a 50% worldwide depression with recover? How do you come up with that as your what if choice?
I can’t disagree that there is a non zero chance of existentially catastrophic events. I just see no scenario that the world economy … and more … is not also destroyed to similar magnitude if that happens. Russia and China take advantage to occupy large regions - the world is a completely different place everywhere.
So to me the choice is no choice at all. If that happens I lose no matter what my play is now. So I may as well make my play based on the assumption that the world does come out the other side of Trump and recovers.
My thinking is as I’ve written. But my behavior to date is as you’ve written. So “revealed preference” is at work here.
To date I’ve adopted a more defensive investment posture and a greater exposure to international equities, but all still held in US-based accounts and institutions. So a half-assed bet on a half-assed outcome.
We shall see.
If the world is destroyed, well it had a decent run.
If there is a prolonged stagflation scenario, well I wasn’t interested in retiring anyway.
Otherwise I’m slightly more defensively positioned than in the past and psychologically prepared to ride out a recession if when it happens.
Riding out our slide into an Orwellian America I am less sure about how to handle. So far I am head full in sand. But I got nothing on my alternative options list. Not for this thread though.
Not the stock market, but at the beginning of the year I cashed out some more “specialized” funds (small caps, real estate) and bought a bit of gold & silver. Both are up about 20% YTD.
Put the rest of the cash into European index funds & a short term CD, which aren’t doing anywhere near as well.
I won’t do puts/calls/options etc. I know my limitations.