Earlier quoted context omitted.
Or to confuse Tesla with a tech company.
What kind of company would you call it?
A battery/renewable energy company.
Tencent buys 5% of Tesla
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Re: Tencent buys 5% of Tesla
#32Smart move. Tencent's investing but not controlling strategy make it good supporter of the new generation of ambitious entrepreneurs against AAAAF(Apple Alphabet Amazon Alibaba Facebook): - JD - Didi - Snap - Meituan-Dianping ……
I am not following. Who are the new generation of ambitious entrepreneurs?
I guess Elon? He's no spring chicken, but certainly ambitious and an entrepreneur.
Re: Tencent buys 5% of Tesla
#33Tesla shorts can't get a break. First a smooth $1B+ capital raise without a stock hiccup and now this.
I didn't short the stock but I can understand why someone would.
They are expected to generate over 90% of their value after 2020 [0]. There's the expectation that Elon Musk will definitely deliver, that Tesla market share will not be eaten up by other carmakers when they seriously start releasing electric vehicles. The expectation that electric and not another form of energy, such as hydrogen, will dominate, etc.
There's a lot that could go wrong and a lot of unknown variables. Then again everything might turn out fine, the point is that no-one know for sure.
[0] https://webcache.googleusercontent.com/search?q=cache:UBQtFu...
Re: Tencent buys 5% of Tesla
#34Earlier quoted context omitted.
Or to confuse Tesla with a tech company.
They changed their name this year from Tesla Motors to Tesla Inc. to indicate a wider focus on technologies, not just cars (solar panels, batteries). How do they not qualify as a tech company?
They changed their name because they bought Elon's solar company (which was also not a tech company).
Re: Tencent buys 5% of Tesla
#35Earlier quoted context omitted.
Can you explain what kind of access you mean? I thought preferential information sharing with specific investors violated SEC rules?
not if they have board seats
Yes, that's the real question. If Tencent obtained a board seat as well, then I could think of all sorts of scenarios that could benefit Tencent in China, but not necessarily Tesla.
Re: Tencent buys 5% of Tesla
#36Earlier quoted context omitted.
Having access to the internals at Tesla is interesting and potentially powerful -- significant ownership share brings many benefits that are by no means small. Albeit on a need-to-know basis and through a peephole, it is nonetheless advantageous. It may cost $1.7B but it guarantees continued access, whereas throwing technical exfiltration (ie: hacking) and manual exfiltration (ie: mole in Tesla staff) whose resources…
Can you explain what kind of access you mean? I thought preferential information sharing with specific investors violated SEC rules?
As mentioned by the other comment, board members get preferential information sharing. I would haphazard to guess that Tencent balked at the purchase price of a seat on the board of directors (eg: 20% stake or something to that effect) or Tesla opposed it on principle. Probably the latter and then Tencent moderated their stake offer.
However, shareholders are afforded access regular updates on the financials of the company, which Tencent may be satisfied with on its own.
Re: Tencent buys 5% of Tesla
#37Tesla shorts can't get a break. First a smooth $1B+ capital raise without a stock hiccup and now this.
Every budding short seller needs to, at some point in their career, learn the lesson of never shorting a growth tech stock.
Rather needs to understand how to have a basket of shorts and manage risk as opposed to shorting single names.
Re: Tencent buys 5% of Tesla
#38Re: Tencent buys 5% of Tesla
#39I only need Twocent to know this is a bad idea.
Re: Tencent buys 5% of Tesla
#40Tesla shorts can't get a break. First a smooth $1B+ capital raise without a stock hiccup and now this.
This is why you should purchase put options instead of short selling. Exposure to short selling is theoretically infinite. Exposure to put options is just the price you paid for the option. Shorting generally should only be for companies whose solvency is in doubt.
With put option you pay a big premium for the right for someone else to take that risk. If the company has a high volatility like Tesla you will pay a big premium to buy that option.