My recent post got a lot of comments by Tesla Fans so I wanted to clarify further why I would Never buy a share of Tesla. If you are a Tesla shareholder or Fan take the time to read and understand what I am trying to say before you downvote. Thanks
This is NOT a recommendation to buy or sell anything and certainly not Investment advice.
So why would I not buy a share of Tesla?
I am an Investor and for every Investment I do I use a checklist. My Checklist is quite long and I won’t share the entire thing here but it includes things such as multiples for sales, cash flows etc.
So just for this reason alone I would never even consider buying Tesla. I would glance at the numbers for about 5 minutes and I would be done with my research. That would be it. It’s ok to miss out if something doesn’t fit your investment criteria.
But lets say it goes past my numbers screening ( or I ignore it) and I would enter the next part of my checklist. My checklist also includes things such as Warning Signs.
My goal is to maximize my gains BUT more importantly I also try to avoid losses. Losses can kill your portfolio and if you lose money its very very hard to get back to where you started. So I try to avoid losing money at all costs.
Warning signs for stocks include : Short seller reports, Media Attention, SEC Investigations, Lawsuits, Accounting irregularities etc.
The thing with Tesla is this: People that are MUCH SMARTER than me spoke out against it. This includes Jim Chanos and recently the “Big Short” Michael Burry as well. So for that reason as well I would just pass on the company. I don’t need to short it either all I need to do is skip it and look for another opportunity.
I would skip on tesla because to me personally I have a risk of capital loss. Thats all there is to it. I don’t need to care about their deliveries, their events etc. I don’t need to care. It’s perfectly fine with me if it goes up another 10x from here.
The markets are full of great companies & opportunities and its not worth it buying something that might hurt your portfolio. Also don’t get pressured into buying something you’re not comfortable with. Fomo is dangerous and can lead to bad decisions.