On Selling Tesla Stock.

uh Yep this is usually a sign of the

bottom

oh man everyone is pissed at each other

Ross Gerber is fighting with Elon Musk I

hate it when my daddy and my step bro

fight with each other it's gotten so bad

that Bloomberg is literally covering the

fight between them on Twitter it's not

even worth covering because honestly

nobody knows what the hell is going on

what I do know though is what's going on

okay I'm kidding I'm gonna give you my

best estimate okay because see let me

give you a quick background here Elon

Musk is like oh well when the risk-free

raid on bonds goes up then it then

people statistically sell uh you know uh

stocks because uh you know they can make

money on bonds and stuff and then uh

Gary black steps in he's like dude

if that were true then NASDAQ wouldn't

be down like one to two percent while

Tesla's down like 53 in just three

months okay okay thank you bye

it's a problem it's a problem okay but

again I don't want to get involved in

the drama what I'm going to talk about

is what I believe is causing the Real

Pain that's happening and I'm also going

to tell you what I'm doing about it

mostly because Tesla is a pretty big

position in in my portfolio and um

cheers to that

um

what is this ah Gentleman Jack hmm

just doesn't do it like Tesla tequila

but

this was on sale

so

what's going on

the second largest by volume day traded

for Tesla

and it's either because Elon sold which

is unlikely because we're pretty sure

we're in a blackout period here before

earnings coming up in a few weeks but

the real number one downtrend baby

it's that simple we are in a massive

downtrend for Tesla and guess what makes

that downtrend continue people making

profit shorting or having puts on the

stock because it's extremely profitable

in fact we kind of just broke that

downtrend to the downside you could see

that here and that is not good that just

reiterates the selling pressure take a

look at the volume today though look at

the movement today I want you to see

this in my Trading Group I mentioned uh

that hey after a big drop like this and

a channel we're probably going to see a

break up or break down and I hate to say

it

but folks look how solid that channel

was and we were charting it from here

we're like oh it's a channel oh no it's

a down Channel which way is it gonna go

well it's bearish oh oh yeah

okay down Trends beget bearish

tendencies

in English when stuff going downhill you

put your little kayak on top of the

stuff going downhill and you go

when you're the guy that's like nah by

the dip and you're trying to go up the

sewage you're like this

right like it sucks you're fighting the

trend this is a downtrend a downtrend

has nothing to do with the fundamentals

of the stock zero but I'm not here to

talk fundamentals to you because I've

done that in other videos and this isn't

a video to preach to you about

fundamentals honestly if you're even

watching this video you already know the

fundamentals of Tesla are strong you

don't need to be convinced by some

weenie telling you that and test this

valuation is still too high really

really a company with over three billion

dollars of a free cash flow potentially

investing 10 billion dollars into a

Mexico gigafactory to manufacture a

lower cost vehicle growing earnings at

50 percent per year even at minimum 40

per year my goodness that is a company

that's overvalued okay well maybe we'll

have to have a talk about Peg ratios in

the future because maybe there's a

disconnect but again this video is not

about fundamentals

let's instead consider the second

potential reason

a lot of people have made a lot of money

on Tesla over the past years

unfortunately people are making less

money right now that is the nature of a

recession in a recession people make

less money you earn less money on side

hustles you earn less money at your job

you get less promotions your other

stocks don't do as well and you kind of

want to keep spending right so what do

you do you finance your lifestyle with

your biggest star Colton called Tesla

now that's either financing your taxes

or financing other Acquisitions maybe

you're buying a house maybe you're

buying a boat a car or a plane or you're

investing in a business in my case I'm

putting a lot of money on bets on my

startups and so I had to sell a little

bit of my shares but that's just to make

sure that I could finance my business

startups and what I need for my business

startups going forward but look I'm just

like you you might have your own reason

maybe you're buying a house maybe you

have a business startup maybe you just

want to make sure you have enough money

next year in case you get laid off maybe

you want to do the third reason tax loss

Harvest I'm not here to elaborate why it

makes sense to sell your stocks now and

potentially re-buy them uh you know

after earnings next month you know in

fact you could you could even sell your

stocks in Tesla now re-buy them before

earnings next month if you really wanted

to and probably Buy in that uncertainty

dip we often get in front of earnings

but I'm not going to tell you that

Tesla's going to be cheaper in a month

from now so if you get screwed it's your

problem okay like I'm not giving you

that kind of advice uh you know and when

we talk regularly we have these sort of

discussions in my course member live

streams remember that's the only sponsor

of this channel is you know whether you

follow me to do uh you know to learn

about all my insight my fundamental

research my understanding of the market

uh or you just want to follow me to do

the opposite it doesn't matter you can

do that join the programs on building

your wealth link down below hey you know

what if you win on both sides that's a

win but what am I gonna do about it

because I can't fight a downtrend I also

am done selling you know I I want to be

clear I'm going to tell you about my

position on Tesla in just a moment as

well uh but um you know I I don't really

care about the downtrend I have uh I I

don't need any more money for financing

uh my business uh plans uh and I'm done

with tax loss harvesting so what am I

gonna do about the rest of the situation

going on with Tesla well I've analyzed

this uh quite in detail over the past

few days uh and significantly today but

even over the last few days

you know I've looked into short-term

calls

short-term puts volatility on Tesla

unfortunately is very high right now and

put to call ratios are extreme so puts

are extremely expensive short and

long-term puts extremely expensive right

now easy to get hosed on these but

short-term calls even though their

cheaper volatility is still elevated on

Tesla and today with an eight percent

down day oh yeah volatility jumped on

Tesla selling calls maybe would have

been more interesting but you want to be

careful with that because that one day

you snap back and then you get called

out and you'll be sad although that

might be okay with you because then you

might want to diversify diversify into

like an actively managed ETF that has

high exposure to Tesla who knows

I decided that for my portfolio

short-term calls short-term puts for the

bulk of my portfolio probably not the

right option because I have a lot of

shares right 60 to 70 000 long shares uh

of Tesla

so uh then there's the consideration

about long-term calls or and potentially

deep in the money calls I mean you could

go all the way out to 2025 and pick up

some 600 out of the money calls you

could pick up some hundred dollar in the

money calls the problem is in the money

calls are very expensive because you're

nearly financing you know two-thirds of

the entire stock uh or paying for

two-thirds of the entire stock and

you're not getting that much upside

leverage and the out of the money calls

if you just trade sideways for a few

months say goodbye to seven percent a

month while the stock is trading

sideways and in this environment I don't

know that I want to make any kind of

short-term bets that the market is going

to v-shape recovery Like Larry Kudlow

this ain't a v-shape recovery Larry cud

low time so I'm not the biggest fan of

making bets on options right now I am a

big fan of playing volatility trades in

fact I've got a special volatility trade

that I'm planning on going a little bit

deeper into tomorrow with the course

members and this is a volatility trade

where I found volatility is extremely

low and there's some really cool

opportunities to take advantage of this

both on the short and the long side so

we'll be talking about that a little bit

more tomorrow

I like volatility trading better than

just trying to YOLO in One Direction or

another and I have found I will say I

have found that if you have a bearish

tilt so you're trading in this market

you're probably going to win seven out

of 10 times whereas if you have a

bullish tilt you're going to win three

out of ten times it's unfortunately just

the way the market is right now but

we'll see we have some good earnings

from Nike and FedEx uh or some some at

least surprises so so we'll see

so what's my answer for my portfolio

what's what's ultimately the answer well

the answer is personal for everyone

right but my belief is that there is no

cheaper option on the future value of

Tesla

than shares of Tesla I know that might

sound boring but I believe that my 60 to

70 000 shares of Tesla could potentially

be worth five six hundred dollars a

piece

with a fair and a reasonable valuation

in potentially less than three years

and I'm willing to make that bet without

exactly betting on the timing see if you

choose options you have to bet on the

timing because the volatility the

volatility could screw you if we go into

a low ball period you're screwed trying

to sell your options we go into a high

ball period and all of a sudden prices

are down which often when Vol goes up

prices go down well then you're screwed

too

uh whereas if you hold options uh or

rather you hold chairs rather than

options

you're not subject to the whims of vol

right volatility or the whims of theta

Decay so the cheapest optionality on

Tesla

is Tesla the Tesla Shares are the

cheapest way to own Tesla right now in

my opinion if you already have Tesla

shares if you want to tax loss Harvest I

do think there is a benefit to moving to

an actively managed ETF that has a large

exposure to Tesla because when and if

Tesla does hit those targets it'd be

nice to have those gains built into an

ETF that can then rebalance without

passing long taxable gains to you that's

a big consideration because consider

this if Tesla goes from 140 today to 600

let's say that's a 4.6 X and on a 4.6 X

if you're going to end up having to pay

you know call them long-term capital

gains of uh 30 or whatever you know

you're going to be giving away

one of those about well probably 30

percent of that so you'll be down to

about a 3.2 x right whereas if an

actively managed ETF can balance that

out for you and diversify some of the

risk that might still happen to the

downside then there could be less pain

in your portfolio but the other thing

you could do is you don't have to go all

in on either Direction you don't have to

go all in on Tesla you don't have to go

all in on and I certainly would never

recommend going all in on Tesla and you

don't have to go all in on one actively

managed ETF you can diversify pick some

ETFs pick some single stocks if you want

but my belief is that what we're seeing

right now is the definition of the

market can remain irrational longer than

you can remain solvent and if you are

deep in margin you're probably selling

out of panic right now and that makes

sense there are two reasons to sell

right now either you're minimizing your

margin or you have opportunities that

you need to make sure don't disappear

because your stock portfolio it was

going down that's as simple as it is now

if you have to pair a little bit of your

portfolio to do that that's okay that

doesn't make you a paper hander that

doesn't make you you know weak that

makes you smart you're you're minimizing

your risk and maximizing your potential

to make sure you could still get through

the next year but do I think that the

best move for me is oh dump all of my

Tesla shares because they're down so

much oh my gosh oh what a clown wow his

stocks went out like I I don't have a

magic eight ball I can only look at the

fundamentals of Tesla and tell you they

are God

beautiful Godly beautiful

that's it that's all I can tell you

that's it I cannot move the stock

that's it that it's that simple so we

are facing an ugly downtrend people are

financing their 2023 people are tax loss

harvesting I've done some of that as

well I actually think after I probably

will after my 30 days right before

earnings I want to buy Tesla if we have

a nice little dip before earnings again

which we might and uh and then I'll be

back to uh to hopefully the share

position where I was previously so uh

I'm optimistic I realize the pain is

very very high right now but this is

what retail capitulation looks like and

Retail is getting screwed here Tesla is

a heavy heavily owned retail stock and

people are losing faith and it's

unfortunate but when people lose faith

it's a sign of that irrationality

unfortunately that comes with Market

pain and stock price is going down

people look at their portfolios get

emotional and sell and sometimes they

sell completely out that's not me I am

not leaving

thank you so much for watching

I got some uh gentleman's Jack to get to

thanks bye