• MJ

WHY AM I SHORTING $TSLA (Tesla Motors, Inc.) and $NIO (Nio Inc.)?

Have a look at the graph below. Elon added $6.1B to his fortune last week. This week, Tesla is 20% up adding another $100B to its Market Cap. There are over $20B shorts on Tesla which is the highest level of shorts in history. To say the stock is overvalued is an understatement.



Having said all that, Tesla has many fans and is a difficult stock to short. Therefore, I have SL with a little loss set as I cannot rule out that the stock will go up. There’s no good reason for that at these valuations, however, going 20% up from 1500 had no reason either. Today, we have learned that Tesla cut the prices of their cars further. The latest model has been cut twice in the last 6 weeks. These are very negative news.


The guy who made his fortune on hitting the options with $1500 should now relax :) With $1750 the bubble has to pop big time and I expect it to go below $1000 in the very near future. Again, I appreciate it’s a difficult stock to short, but the opportunity is just too good and it enters my requirements for shorts (20% upside potential max with 50% downside potential).


I also opened a short again on $NIO I previously made a short that I closed with 5% profit given that the banks are extending loans to Nio. This company is actually close to bankruptcy and although many big investors are both here and in Tesla, the Chinese stock does neither have a charismatic leader as Elon nor is it showing any sales or, God forbid, any profit. That’s why I’m shorting it long term, also with a SL that will not burn me even if I’m wrong.


What are your thoughts Guys? Looking forward to CIVILISED comments and discussion.


Very best,

MJ

Marcin Jasinski

Entrepreneur & CEO Advisor

+352 661 10 80 10

www.mjtheconsultant.com

Portfolio and Wealth Management

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