01-13-2020, 02:16 PM
(01-11-2020, 11:28 PM)fenders53 Wrote: -It's a cult stock with huge momentum so fundamentals do not matter like they do to us. Do they matter some day? Of course, but what year? I learned some shorting lessons shorting AOL. I was right in the end, they were replaced. TSLA was in deep financial trouble in 2019. How long did it stay down before the next launch? Half the small investors don't know what a balance sheet is, and the other half don't seem to care about fundamentals as long as units and sales grow.
Sure you could argue that it's a cult stock because there are a lot of small investors who believe this company is the next coming of Jesus Christ and Tesla is probably a double digit percentage of their whole portfolio.
But, in my opinion, those small investors may be loud on social media etc but they simply do not have the cash to move the stock price. Those times are long gone, this is a company with a current market cap around 90 billion. That is massive and it'll take a fanboy or two to make these 7% moves if they have $500 per month to invest. Also, if you look at the ownership charts, at least according to the data that I have, pretty much everyone that has a position large enough the appear on the charts is a big time investment fund and tesla is often less than 0.50% of their total portfolio. This is nothing with a wow factor, it's the same with most companies. But it does show who has the cards in their hands and who are just watching from the sidelines.
Sure, tesla has a strong fan base and plenty of small investors are part of that. And you are probably right that half of them don't know what a balance sheet is. But I'd argue that it has almost no effect on the stock price, this stock is large enough to only be moved by the big investment funds.