Earlier quoted context omitted.
Isn't EBIT 'Income before interest and taxes'?
I sincerely doubt that the E stands for income.
Oops. I mean Earnings.
Tesla Was Cash Flow Positive Last Week, CEO Musk Says
241–246 of 246 posts
Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says
#242Earlier quoted context omitted.
That sounds amazing. Could you explain how you set up your hedge, and why it doesn't cost you anything? I'm just starting to learn about option strategies.
Basic strategy (there are others): I own stocks in 100 chunk blocks. I then buy the exact same amount of -15-20% puts to cover my downside risk and simultaneously sell the same amount of ~+10-20% calls and use their premium to make the insurance free. My portfolio value, if hedged perfectly and fully backed with cash is now locked to +/- ~20% (depending on IV) at little to no cost. More here: http://www.investopedia.…
TSLA Puts seem to be priced with higher IV than Calls at the same distance for both near and far expiries (Calls at 120% vs. Puts at 80% of spot). I see Puts at strike $27 priced at 200% to 166% of the Calls at strike $41.
Options chains from Google Finance : http://www.google.com/finance/option_chain?q=NASDAQ:TSLA&...
So I'm assuming that the TSLA collar (unlike your other equity collars) is not costless. Or is it? Am I missing something?
Thanks for sharing your thoughts, BTW. I'm just loving going through your comments on other HN articles!
Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says
#243Earlier quoted context omitted.
Basic strategy (there are others): I own stocks in 100 chunk blocks. I then buy the exact same amount of -15-20% puts to cover my downside risk and simultaneously sell the same amount of ~+10-20% calls and use their premium to make the insurance free. My portfolio value, if hedged perfectly and fully backed with cash is now locked to +/- ~20% (depending on IV) at little to no cost. More here: http://www.investopedia.…
TSLA Puts seem to be priced with higher IV than Calls at the same distance for both near and far expiries (Calls at 120% vs. Puts at 80% of spot). I see Puts at strike $27 priced at 200% to 166% of the Calls at strike $41. Options chains from Google Finance : http://www.google.com/finance/option_chain?q=NASDAQ:TSLA&... So I'm assuming that the TSLA collar (unlike your other equity collars) is not costless. Or is i…
Yeh that's why I said ~15-20% - it varies with IV, I just take a different spread than exactly +/- 20%. Fundamentally I don't want to be exposed to black swan downside, and black swan upside is statistically rare - so I don't mind losing that (things don't move up 30-40% in a month too often - manias/booms are slow - but they have moved down 30-40% crashes/panics -> bull markets are slow, bear markets are fast - and that is the asymmetry I'm exploiting to cap my risk without negatively effecting my return - selling covered calls is effectively free money most of the time, and buying puts covers my ass from Enron like events and the asymmetrical movement between booms/busts/disclosure negative information like bankruptcy).
Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says
#244Earlier quoted context omitted.
That sounds amazing. Could you explain how you set up your hedge, and why it doesn't cost you anything? I'm just starting to learn about option strategies.
Basic strategy (there are others): I own stocks in 100 chunk blocks. I then buy the exact same amount of -15-20% puts to cover my downside risk and simultaneously sell the same amount of ~+10-20% calls and use their premium to make the insurance free. My portfolio value, if hedged perfectly and fully backed with cash is now locked to +/- ~20% (depending on IV) at little to no cost. More here: http://www.investopedia.…
This is incredibly fascinating to read. Thanks for the links and insight.
Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says
#245Earlier quoted context omitted.
What I would enjoy is never having to stop for gas before commuting to work. Charge it overnight, and I am certain to have enough. No more driving on fumes because I forgot I was low and I don't have time to do it in the morning. The sum of all the time spent at the pump will be greater than the times you spend at Superchargers for the occasional long distance trip.
Filling my car up never bothered me personally. I suppose my thinking is just that while most of the time it will be fine, you won't have to look that far or try that hard to find a journey that would need a recharge to complete. Visiting friends, let's say. Now, what are your options? You could visit the super charger, which could work, but that assumes there is one nearby! (There are currently all of six, and all i…
Well, you're right: It is 2012, and there are (at the time of writing) all of 6 supercharger stations, which can fill a battery at up to 120 kW. The current incarnation (heh) of the Tesla S battery limits the rate to about 80 kW for the first 50%, or so.
However, there are probably more places to plug in than you'd expect. For example, there are tons of RV parks all around the country, many of which have NEMA 14-50 sockets for grandma and grandpa to plug their big camper into. Those sockets can deliver about 10 kW. Then there are electric clothes dryers, found in many homes: They typically use a 240V, 30A circuit, which can deliver about 5 kW continuously.
That last option isn't really practical on the freeway, but how far do you plan to drive to hang out with friends for half an hour? Let's say you drive a couple hours and stay for the afternoon: Their dryer socket will refill almost half of a Tesla's battery for the grand sum of $5--that'll be enough to get you home (there are practical problems with the approach, but it's not a bad 0th-order approximation). Are your friends so worried about electricity that they wouldn't accept a 6-pack of their favorite brew in exchange for a power outlet?
Electric car owners who frequent online forums report that hotels are very reasonable about charging, and some even install free-to-use chargers as a value-add to attract customers. In the long term, if electric car adoption increases, hotels will obviously either need to add a surcharge or raise room rates. But, even if a hotel did sell electricity at a 100% markup, the customer's energy cost for driving a mile on electricity would still be less than half the cost on gasoline.
Certainly, electric cars won't work for all trips, and the infrastructure needed to move electrons from the grid to the car is missing in many places. On the other hand, equipment for 10 kW charging (that's a charge rate of about 30 miles per hour) can be installed almost anywhere in the continental United States for between a few hundred and couple thousand dollars (and in many places it already exists). For new construction, before landscaping is installed and where a right-size breaker panel can be installed in the first place, the cost of installing 240V, 50A service in the garage is almost inconsequential.
Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says
#246Earlier quoted context omitted.
TSLA Puts seem to be priced with higher IV than Calls at the same distance for both near and far expiries (Calls at 120% vs. Puts at 80% of spot). I see Puts at strike $27 priced at 200% to 166% of the Calls at strike $41. Options chains from Google Finance : http://www.google.com/finance/option_chain?q=NASDAQ:TSLA&... So I'm assuming that the TSLA collar (unlike your other equity collars) is not costless. Or is i…
Yeh that's why I said ~15-20% - it varies with IV, I just take a different spread than exactly +/- 20%. Fundamentally I don't want to be exposed to black swan downside, and black swan upside is statistically rare - so I don't mind losing that (things don't move up 30-40% in a month too often - manias/booms are slow - but they have moved down 30-40% crashes/panics -> bull markets are slow, bear markets are fast - and…
Thanks! Yes, (in my 4 years of trading experience,) I've only seen pharma stocks move up 30-40% in a month (or day!).