No, There Is No New Short-Selling Champion in Tesla Stock

Barrons2022-08-21

There was a stir in the Tesla investing community when a regulator filing indicated that asset manager Deer Park Road made a seemingly huge bet against Tesla stock using put options. The stir is just ...

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NP_YT
2022-08-22
NP_YT
Ok
Longshot
2022-08-22
Longshot
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Looyusooi
2022-08-22
Looyusooi
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Jess261
2022-08-22
Jess261
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Ninjek
2022-08-22
Ninjek
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keegs
2022-08-22
keegs
[Miser]

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The stir is just ...</p>\n\n<a href=\"https://www.barrons.com/articles/tesla-stock-short-selling-51660942310?mod=RTA\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"TSLA","symbol_name":"特斯拉","start_time":0,"source_url":"https://www.barrons.com/articles/tesla-stock-short-selling-51660942310?mod=RTA","article_id":"2260785313","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2260785313","pubTimestamp":1661045446,"sourceInfo":{"source_id":"lsy1601382232898","name":"Barrons"},"weMediaInfo":null,"summary":"There was a stir in the Tesla investing community when a regulator filing indicated that asset manag","collect":0,"end_time":0,"defaultTopTitle":"barrons.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"TSLA":"特斯拉"},"translate_title":"不，特斯拉股票没有新的卖空冠军。--Barrons.com","themeId":"","isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"TSLA":1},"content_text":"There was a stir in the Tesla investing community when a regulator filing indicated that asset manager Deer Park Road made a seemingly huge bet against Tesla stock using put options. The stir is just a tempest in a teapot. There is no new short-selling champion for Tesla bears to hoist onto their shoulders.A put option is, generally speaking, a bearish bet. It gives the holder the right to sell a stock at a fixed price in the future. Holders of put options do better the lower a stock price falls.A quarterly regulatory filing indicated that Deer Park had amassed put-option contracts representing more than 4.8 million shares of Tesla (ticker: TSLA) stock. That much Tesla stock is worth roughly $4.3 billion at current prices. On the surface that looks like a massive bet.But that isn't really the way options work. The price paid for an options contract depends on many factors including the strike price and time to contract expiration.Consider Tesla put options that expire Friday Aug. 19, and give the holder the right to sell Tesla stock at about $800 a share are essentially trading for about one cent. Theoretically, amassing options contracts that reflect 4.8 million shares of Tesla could cost someone $48,000. That's a long way from $4.3 billion.It wouldn't be a good idea, though. There isn't high probability that Tesla stock will drop about $100 in the final hour of trading Friday.(There isn't much trading volume in those contracts. It's just an example.)Deer Park Chief Investment Officer Scott Burg told Barron's the Tesla put-options position amounted to 0.1% of his portfolio. That isn't all that much, and indicates Deer Park probably paid the less than $1 per share represented the puts.That isn't a lot for a stock worth about $900. That also means the put options were either expiring soon, or deeply out of the money, or both. Burg didn't get into contract specifics, but said the position was closed profitably. The tiny position is already gone.Profits aren't hard to fathom. Tesla stock did fall, along with other technology shares, in the second quarter. Tesla stock dropped almost 38% from the end of March to the end of June while the Nasdaq Composite fell 22% over the same span.Burg doesn't consider himself a big Tesla bear. He's says he is bearish on the overall economy and the consumer. He expects Tesla stock to struggle, but just like any other consumer discretionary stock this coming year.The whole episode does illustrate an important lesson about options trading. There are many ways to use options in a portfolio.Investors can buy options contracts far from current prices. They are cheap and only pay off if extreme events happen. They can also be used to bet on volatility. Options get more valuable as stock volatility rises and less valuable when volatility falls. Options can be used to hedge a portfolio, too.What's more, bearish options bets can actually generate income for bullish investors. Take Tesla. It doesn't pay a dividend. If that irks some shareholders they can sell call options contracts. (Selling a call is similar to a put option. Both work out if the stock falls. It's a bearish bet.)A Tesla holder selling a $900 call option that expires in September gets about $44. That's almost 5% the value of the Tesla stock. The risk with selling call options against stock held is that the stock could go up. If Tesla hit $1,000, that holder would have essentially sold some of his position for $900, missing out on the additional gain.There are many other things pros do with options. People have careers trading options for brokerage firms and asset managers.However, options don't indicate with certainty how someone feels about the stock that underlies the options contract.","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":1},"commentList":[{"id":9996846539,"gmtCreate":1661150551723,"gmtModify":1676536462705,"author":{"id":"3572043809285615","authorId":"3572043809285615","name":"NP_YT","avatar":"https://static.itradeup.com/news/fad9f70abb174e3e09e4caf3f9c0c13a","vip":1,"crmLevel":4,"crmLevelSwitch":0},"htmlText":"Ok","listText":"Ok","text":"Ok","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9996846539","repostId":2260785313,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":9996887602,"gmtCreate":1661144724208,"gmtModify":1676536461699,"author":{"id":"3570092809336734","authorId":"3570092809336734","name":"Longshot","avatar":"https://static.tigerbbs.com/7cad4ddeab0622dd29ed1d7c76c750b8","vip":1,"hat":"https://static.tigerbbs.com/306aa047bc14b6942cda1aed925cf8c3","crmLevel":6,"crmLevelSwitch":0},"htmlText":"Like","listText":"Like","text":"Like","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9996887602","repostId":2260785313,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":9996195184,"gmtCreate":1661130202752,"gmtModify":1676536457765,"author":{"id":"4100437715079400","authorId":"4100437715079400","name":"Looyusooi","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":3,"crmLevelSwitch":0},"htmlText":"ok","listText":"ok","text":"ok","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":2,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9996195184","repostId":2260785313,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":9996358172,"gmtCreate":1661127128999,"gmtModify":1676536456423,"author":{"id":"3586490638953193","authorId":"3586490638953193","name":"Jess261","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":3,"crmLevelSwitch":0},"htmlText":"Okay","listText":"Okay","text":"Okay","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9996358172","repostId":2260785313,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":9996384365,"gmtCreate":1661125675359,"gmtModify":1676536455689,"author":{"id":"3581856827682527","authorId":"3581856827682527","name":"Ninjek","avatar":"https://static.tigerbbs.com/689e2dabbb18545d2e55228c4ad12578","vip":1,"crmLevel":2,"crmLevelSwitch":0},"htmlText":"💯💯💯","listText":"💯💯💯","text":"💯💯💯","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":5,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9996384365","repostId":2260785313,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":9996310148,"gmtCreate":1661124819487,"gmtModify":1676536455188,"author":{"id":"3577084956936337","authorId":"3577084956936337","name":"keegs","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":4,"crmLevelSwitch":0},"htmlText":"[Miser]&nbsp;","listText":"[Miser]&nbsp;","text":"[Miser]","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9996310148","repostId":2260785313,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"}],"isCommentEnd":false,"newsSizeData":{"likeSize":1317,"commentSize":0,"repostSize":0,"favoriteSize":1,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.22.4","shortVersion":"4.22.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2260785313"}