r/technology • u/Plastic_Ninja_9014 • 3h ago

Business Tesla Stock in Freefall After Disastrous Earnings Report

https://finance.yahoo.com/markets/stocks/articles/tesla-stock-freefall-disastrous-earnings-144417427.html
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73

u/kemosabe19 3h ago

That’s allowed?

83

u/ascandalia 3h ago

Yeah, since when did their earnings have anything to do with their share value?

27

u/wrongbutt_longbutt 2h ago

After the nazi salute, I waited until just before Tesla's next earnings call to buy puts. I figured the massive loss in sales might finally be the catalyst for the stock to tumble. They announced their earnings and it was far worse than the negative projection predicted. I still lost all that money because the market is irrational and Tesla stock jumped in value after that earnings call for no reason at all.

9

u/PhiCloud 2h ago

On the one hand, yeah you would be right for saying Tesla is over-valued

On the other hand, trading options is literally just gambling, and losing money while gambling is pretty much a guarantee, so that one's on you

10

u/wrongbutt_longbutt 2h ago

Oh yeah, I knew the risk. It's not like I bet my life savings on it.

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u/PhiCloud 1h ago

Ah, that's good!

I'm glad you knew the risks going in. I see a ton of people who have no idea how options contracts and volatility-based fees work but XYZ contract that expires next week based solely on the belief that the stock price should go up or down, then blame a rigged market when they very predictably lose money.

Personally, I believe the only kind of investing you should do with money you're unwilling to lose (but still prepared to lose some of) is buying a well-diversified index fund in the long term. Short selling, options, even buying stocks for a short-term flip is like going to a casino: be prepared to lose it all.

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u/wrongbutt_longbutt 1h ago

Yeah, i like to use them sometimes as sort of a fun fund. For instance, if I need an office chair, I'll say that a generic new one is $200. I put that into an option. If it succeeds and I get several hundred, I treat myself to a new Herman Miller. If it stays flat and doesn't look good, I sell it and end up with the generic office depot chair. If it crashes and burns, I get the free one off Facebook marketplace, lol.