Elias Chen commented on a stock · Yesterday 16:25

A geometric analysis overview of Tesla's charts over various time periods.

Musk's Trump Trade Makes Tesla a Winner With $570 Billion Rally

What triggered the turnaround? The company had nothing, demand for cars remained unstable, and the future seemed increasingly uncertain. Instead, investors view it as Elon Musk's political masterpiece, actively supporting then-President-elect Donald Trump during the election and playing an unofficial role in his administration.

What happened that led to this turnaround? The company had nothing going for it, the demand for cars remained unstable, and the future seemed more and more uncertain. Instead, investors see it as Elon Musk's political masterpiece, actively supporting the elected President Donald Trump during the election and having an unofficial role in his government.

"How do you value the fact that Musk has in-depth contact with the upcoming government?" said Steve Sosnick, Chief Strategist at Interactive Brokers. "You can almost assign any number to it."

Investors seem to be doing just that. Before the U.S. presidential election, Tesla's stock price dropped by 2.3% this year. Since Election Day, they have risen by 73%, by 2024 they have risen by 69%. This means that in less than two months, the electric car manufacturer has added a staggering $572 billion to its market cap, reaching around $1.4 trillion, despite the company seemingly undergoing no fundamental changes (which is not the case).

Tesla's stock price slowed its decline this week, dropping 3.5% after rising more than 12% per week in the previous two weeks, as the Fed's hawkish pivot triggered a broader sell-off in stocks. Saturday marks the fourth anniversary of the stock's inclusion in the S&P 500 Index.

The company did not respond to requests for comment.

Despite Trump's known aversion to electric cars, investors seem to be betting that Musk's ongoing close relationship with the government will pave the way for Tesla's ambitions to produce fully self-driving cars. Several Wall Street analysts have significantly raised their price targets for the stock. They believe the Trump White House was a game-changer for autonomous driving technology, and Tesla stands to benefit from alignment with the new government through regulatory relaxations.

Shaky platform

However, at the same time, the electric car manufacturer saw a sharp drop in earnings and revenue expectations for 2024, 2025, and 2026 this year. It is currently unclear when their robotaxi plan will start generating profits. The uncertainty of the next few years has some investors worried that Tesla's high market cap is built on a shaky platform.

By 2025, Tesla's stock may face significant obstacles, requiring some time for the stock price to continue to rise.

Tesla's market cap of $500 billion to $600 billion is based on its electric vehicle and energy business, with the rest attributed to "future things" like autonomous driving cars and humanoid robots. Quantitative analysis calculations from modeling show that over 90% of Tesla's stock price is related to what the company may do in the future.

In terms of autonomous driving, regulations have hindered Tesla.

Betting on power.

The theory of Tesla's parabolic rise in stock price is rampant on Wall Street. Investors are hoping to bet on Musk's growing power in Washington; a significant number of followers among retail traders are driving this. Trump's election victory could change the electric car manufacturer and bring huge benefits in the future.

Those who have been against Musk and Tesla have been proven wrong. There is nothing to stop him from executing his vision now.

In many ways, Tesla and Bitcoin have become advocates of the post-election rebound triggered by market animal spirits.

This rebound reminds us of the trends we saw in 2020 and 2021, except this time Tesla's story has more intangible assets. The stock rose by over 740% in 2020, then by 74% by November 4, 2021, reaching an all-time high. The difference is that these gains are due to Tesla's soaring sales and profits, with a bright outlook for electric vehicle demand.

As the Technology frenzy of 2021 collapsed due to concerns over inflation and soaring interest rates, Tesla's stock price plummeted sharply. Subsequently, warnings of unexpected slowdown in electric vehicle sales and weakening profit margins emerged, and the stock made efforts to rebound to previous highs. It set a new record since Trump's election in 2021.

The Options market tells a similar story. Tesla is a favorite of derivatives traders and has been the fifth largest stock options position in the U.S. by nominal trading volume for the past month. The top four are the S&P 500 Index, SPDR S&P 500 Index ETF Trust, Invesco QQQ Trust Series 1, and the NASDAQ 100 Index.

There has been a dramatic upward trend. As holding Call options on the stock has been effective, people have been doing so all along.

As long as this pattern continues, Tesla's stock price can continue to rise. After all, its investors are no strangers to such rapid rallies. With Musk playing a role in the Trump administration, the company's ultimate outcome is undecided.

The issue is that Musk has only one public market game on, symbolized by TSLA. This makes it the focus of global investors, with valuation not even a consideration for many of them.

Let the market and Block Orders know: I am not a lamb or leeks that can be slaughtered at will, not standing still. Buying low is for selling high and profiting, realizing floating profits; selling high is for more gains, preparing more funds for the next round of buying low, not for daydreaming.

The key to trading is overcoming the inherent weaknesses of human nature: fear, greed, regret. Only when these three points are overcome can some correct strategies be effective. The biggest fear in investing is permanent loss.

Of course, falling is much faster and easier than rising. Gravity. Degeneration requires no energy, self-explanatory. Rising requires the accumulation of kinetic energy. That's the difference.

All problems that money can solve are not problems; all problems, in the end, are issues of time. You are not young anymore, yet still acting so childish all day, playing the role of a stock market consumer, like a huge baby. It's time to make a change, time to progress.

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Rebellious Miracle

The first iron law of Wall Street---do not go against the market.

The second golden rule on Wall Street --- always cut off losses.

The third golden rule on Wall Street --- violating the above two rules, one can't survive more than six months.

Michael Steinhardt not only frequently violates the above two golden rules, but also retires with assets of 4.5 billion!

In 1967, shortly after George Soros established the largest hedge fund company, Michael Steinhardt also founded a famous hedge fund company. Steinhardt, an outstanding and elegant person, had his office in the same building as the Neuberger-Berman Foundation. He had a house in Westchester. For a large fund, he was a good manager and a strict boss.

In 1994, during the bond market crisis, many hedge funds estimated that some European countries would cut interest rates to stimulate their weak economies, so they bought a large amount of bonds and waited for appreciation. Of course, as usual, they heavily leveraged their positions. Stanhart and his funds only held a total of $30 billion in bond positions, but the Federal Reserve of the USA increased interest rates by 0.25% due to the strong domestic economy, causing Europe to follow suit. Stanhart faced his biggest Waterloo, losing $1.3 billion overnight. However, even so, his fund has maintained a compound annual growth rate of 25% over the past 20 years.

In 1995, he grew tired of short selling in the market and decided to retire completely. He claimed that he had enough money and wanted to seek other excitement. He bought the property north of Westchester, as well as many properties in the Clooney Reservoir. There is a tree-lined avenue around with a view of the reservoir. His house is on the right bank of the river, with a large swimming pool in front. The house used to belong to Theodore Dreiser, a 20th-century novelist who wrote 'An American Tragedy'. On his land, Stanhart bought many animals, creating a wildlife zoo. He fed them, almost creating an African wildlife sanctuary.

Stanhart talks about the secret to success by saying: Courage is more important than knowledge, and timing is more important than direction.

Investment Principles

1. Make mistakes early.

Implement decisions immediately and continuously correct the decision.

2. Do what you love

Taking this path, your persistence can ensure long-term happiness and success, rather than the emptiness after short-term speculation.

3. Stay relatively agile.

Always study all possible areas that may bring wealth, and perceive changes in the trend earlier than others.

4. Make full use of information.

Many pieces of information are useless. The key is how to grasp the existing information and focus on the most important issues.

5. Trust your intuition.

Experience is a kind of wealth. It must be acknowledged that intuition is also an accumulation of experience. The key is how to balance between intuition and experience.

6. Avoid making small investments.

Human time and energy are limited. When taking risks in investments, make sure the returns are sufficient to compensate for the expenses.

Daily Devotional - December 21, 2024

Lord, please listen

Author: Mark Renfroe

Listen immediately
I'm not good at cooking, but I know that the ingredients in a recipe are not the only important factor in making a delicious dish. You can have all the right ingredients, but if you don't follow the instructions, you will end up with something you don't want. While I never want to simplify prayer into a formula, God provides us with a marvelous pattern in Psalm 27 on how to pray in difficult times.

This psalm helps us understand David's prayer for deliverance while fleeing from Absalom. Can you imagine what David was thinking? He not only had to protect his own life and his closest people, but also deal with the pain of betrayal. Although the relationship between the Israelite king and his son was complex, he had never before put him in the ranks of enemies. All of this has changed. Absalom not only wanted the throne; he also wanted the king's head.

Given David's situation, people might think that the first thing he said to God was 'Save me!' Although he did ultimately achieve this, he focused on God's character at the beginning of his prayer. He recounted the character and attributes of God. He reminded himself that God is his light, redemption, fortress, shelter, and savior. Based on God's character, he made a statement of faith, saying, 'He will hide me. He will protect me. He will make me lift up my head above my enemies. So, I will sing and make sacrifices.' He acknowledged that he would be victorious in this situation, not because of his own strength or military prowess, but because of his steadfast belief in God's salvation.

Did David just assume this salvation? No. He brought his situation before God, but only when he focused his thoughts on God rather than his circumstances. He declared, 'Lord, please listen!' He admitted that he was in desperate need of help. He knew his only hope was God, so he turned to God for help. Even today, his prayer carries a tone of desperation. 'Do not deliver me over to the desire of my foes, for false witnesses have risen against me, and they breathe out violence.' (Psalm 27:12, ESV)

When you find yourself in great need, turn to God. Focus on Him. Trust Him. Don't forget to pour out your needs to Him. Following this pattern can not only honor God, but also help protect your soul from fear.

Mark Renfroe and his wife Amy have been involved in on-site missionary work for 30 years. Mark has served as a regional director for Assemblies of God World Missions and currently serves as Chief Missions Officer for World Challenge.

DAILY DEVOTIONAL – December 21, 2024

Hear, O Lord

By Mark Renfroe

Listen Now
I’m not much of a cook, but I do know this: The ingredients of a recipe aren’t all that’s important in making a delicious meal. You can have all the right ingredients, but if you don’t follow the directions, you’ll wind up with something other than what you wanted. While I never want to reduce prayer to a formula, God gives us a wonderful pattern for how to pray in times of trouble with Psalm 27.

This psalm gives us insight into David’s prayer for deliverance when fleeing from Absalom. Can you imagine what was going on in David’s heart? Not only was he trying to preserve his life and those closest to him, but he was also dealing with the pain of betrayal. While the king of Israel had a complicated relationship with his son, he wouldn’t have previously placed him in the enemy column. All of that had changed. Absalom not only wanted the throne; he wanted the king’s head.

Considering David’s circumstances, one might expect his first words to God to be “Help!” While he did eventually reach that point, he began his prayer by focusing on God’s character. He recounted God’s character and attributes. He reminded himself that God was his light, salvation, stronghold, shelter, and deliverer. Based on God’s character, he made statements of faith, saying, “He will hide me. He will shield me. He will lift my head above my enemies. So, I will sing and make sacrifices.” He acknowledged that he would come out of this situation victorious, but it wouldn’t be because of his strength or military prowess. It would be because of his unwavering faith in God's deliverance.

Did David just assume this salvation? No. He brought his situation before God, but not until he had focused his heart and mind on God instead of his circumstances. He proclaimed, “Hear, O Lord!” He acknowledged his utter need. He knew his only hope was God and turned to him for help. Even today, his prayer still has a tone of desperation. “Give me not up to the will of my adversaries; for false witnesses have risen against me, and they breathe out violence” (Psalm 27:12, ESV).

When you find yourself in great need, turn to God. Focus on him. Trust in him. Don’t forget to take your needs to him. Following this pattern not only honors God, but it will also help protect your heart and mind from fear.

Mark Renfroe and his wife, Amy, have been involved in field missions work for 30 years. Mark served as the area director for Assemblies of God World Missions and currently serves as the chief missions officer for World Challenge.

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Elias Chen

成熟投资者：格局，概率，取舍。没有格局必然急功近利。不计概率会把运气当技术。不懂取舍，有所不为，最后必落入陷阱和圈套。

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