Shares: TSLA


I’ve entered a shares position on TSLA at $304.99 per shares. The company and it’s CEO Elon Musk have been battling the SEC over penalties resulting from a statement on Twitter by Musk that he planned to take the company private.

The statement roiled the markets as TSLA rose sharply, peaking at $387.46. The SEC’s proposed penalties led the price down to $260.56. The SEC announced a settlement on Saturday, and on Monday, when I entered the positions, the shares had risen sharply in pre-market trading, into the lower portion of the pre-brouhaha trading range.

The reason I chose long shares is that I think the settlement will give Tesla the best of all worlds.

Musk is a visionary genius, although erratic in his management style, especially in his public upset over short-sellers in the markets. The settlement requires Musk to step down as CEO for a minimum of three years. That will allow for professional oversight of his decisions. However, he will still retain his 19% or so ownership of the company, will still be the operational boss. In other words, the company keeps his genius, keeps him motivated and has a professional CEO to question his decisions.

And it’s time-limited. The Elon Musk of 2021 will have learned and grown, as we all do, and will perhaps be better able to again do the CEO job.

Bottom line: For me, TSLA is a story stock, pure and simple.

By Tim Bovee, Portland, Oregon, Oct. 1, 2018

Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.


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