Lol, no losses for me on TSLA, I'm an investor. 2,3-5 years from now this period will look like a blip in the market.
Tesla TSLA has topped
- Thread starter Master Pu
- Start date
That generally only occurs when there is a Fed PUT.
Hope it's not a blip to the high side.
As an investor you have now held TSLA for a year or so (My guess) and you're underwater. That's dead money. If we go into a resession for a couple years, when will you get your money back? What's your guess at where the price is heading?
Vicbee keeping in my deaddog's post, the time value of money. No one, not even a newborn, gets any younger.
If an investment is not making money it is losing money. That is why using a stop loss, even on a long-term investment, is so very important.
Elon is learning that lesson on his TWTR offer. Not having a mental stop loss, so to speak, to tell him to get out ... now. He drinks his own kool-aid. But in his case it comes out of a bong.
If an investment is not making money it is losing money. That is why using a stop loss, even on a long-term investment, is so very important.
Elon is learning that lesson on his TWTR offer. Not having a mental stop loss, so to speak, to tell him to get out ... now. He drinks his own kool-aid. But in his case it comes out of a bong.
I avoided Tesla like the plague. However, after watching a few people a lot more smarter than me get burned by trying to short it, I decided that's not the way to go either. Just sitting here on the side-lines and watching the world burn for the time being...
I respect your comments so let me try to reason with you... To set up my point, I decided to turn Tsla into an investment in Q4 '21 after it topped, when the market started to crumble. I had sold other stocks at significant losses and transfered assets into TSLA for the following reasons 1. I didn't know how or want to trade a falling market, 2. Inflation was beginning to rear its head and the talk was of rising inflation, 3. Tesla's future is bright, it's businesses are leaders and it has repeatedly beat expectations.
To sum up, I want to sit out this period until I see more clarity, I'm not going to sit this out with inflation eating my cash, and if one company is going to beat the crash, it's Tesla. Thus, I invested in Tesla for the next 5 years.
This is year 1, I'm down 25%, which isn't bad considering that TSLA is at its lowest since May 2021, right before it peaked at 1240. It means that the coming bad quarter is reflected in the price. I expect a bit more of a drop upon announcement but I expect Tesla to make its annual forecast and its share price to recover, at least 25% by year end. I will benefit from the 3 for 1 split and may even end in the green.
I recognize that my little story doesn't negate the need for stop losses. I would probably be making money on TSLA now rather than be waiting for a recovery. But like I said, I'm not keen trading a falling market.
I was at one time what you would call an investor. The crash or correction or whatever you want to call it in 2001 changed my mind. I didn't sell at the bottom or capitulate but held on and the portfolio eventually recovered. Not all stocks, but the account balance got back to where it was in 2001. (Took about 5 years)
I decided that I didn't want to go thru that again and came up with a strategy that kept me out of drawdowns.
When I started to implement this strategy, my super power seemed to be the ability to change the direction of a stock from down to up simply by removing that particular stock from my portfolio. As time went on I seemed to lose that power and the results got better. I managed to avoid 2008 and 2020.
The phycological pain of taking a loss and the fear of missing out were hard to overcome. I asked myself what is the worst thing that could happen if I did nothing. The stock could go to zero and be delisted. ( It has happened to me more than once)
What is the worst thing that could happen if I go to cash? The stock could go to the moon and I missed out on becoming a billionaire. (I didn't buy any bitcoin years ago)
Which scenario is the most devastating? At my point in life losing all my capital would be worse than missing an opportunity. There will be other opportunities but I had no way of recovering my capital. (You can't win if you don't play and you can't play if you don't have any money)
With todays discounted commissions and electronic trading it's easy enough to get in and out of the market. With a zero commission broker you can sell one share at a time if you like. It's not an all or nothing situation, you can sell or buy small tranches. There is no law that says you can't buy back in if you guess wrong. There is no reason to stand by and watch your net worth drop because you decided that something is an investment.
Well put and I may add another point. If you use a stop loss and get stopped out on what might turn out to be a major drop (like what we are currently witnessing) you then have more money left, to put to use when the wave turns back up again.
While not stressing over stock going wrong direction.
"It's When You Sell That Counts" by Donald Cassidy (1997) goes into all the games we play with ourselves. His number one main point is, knowing what you know today would you still buy it and why? I like his "Mother" test better, would you recommend it to your own mother?
While not stressing over stock going wrong direction.
"It's When You Sell That Counts" by Donald Cassidy (1997) goes into all the games we play with ourselves. His number one main point is, knowing what you know today would you still buy it and why? I like his "Mother" test better, would you recommend it to your own mother?
Lots of points made there. 5 years to recover your initial investment is rather long, but you got it back. Had you sold at 50% loss, you might have been able to use the remaining amount to recoup your losses and made money. Or not. Woulda coulda shoulda has not place in trading.
Yes, it's amazing to watch a stock reverse shortly after buying/selling. It's as if someone was hired just to mess with you. Although that feeling goes away when taking a step back from day trading, particularly when the market goes sideways.
I too, like probably all traders, experience the gambler's fear of taking losses and missing out. I held on to stocks that delisted, closed a good day on a last trade that swiped all my gains and some, and watched stocks go to the moon in front of my eyes while I stood there incredulous. I've been fortunate to have made a lot of money but also lost a lot of money through it all over a relatively short period of time.
There was a discussion some time back on the board regarding realized/unrealized gains and losses, with some asserting in effect that there is no such thing as unrealized. I continue to think that there is a difference, that nothing is real until the sell button is pressed. It's not only reassuring psychologically but it's also a fact despite the many ways sophisticated financiers are able to blur that fact.
I strongly believe in Tesla's future and even more in TSLA reaching new highs within 2 years. With the stock split as a multiplier, I'm confident to recoup my losses of the past year without the risk of trading the stock.
Back in 2020 I day traded TSLA and measured my gains against a friend investor's result. 2020 was a very unusual year as TSLA shot up with few reverses, but my conclusion was that the risks/stress from trading were not worth the extra gains. I believe today's market favors trading and yield better results than investing but I'm simply not willing to take the loss to prove it. I have zero stress about my investment.