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Let's kill those shorts. Here is a way.

Let's kill those shorts. Here is a way.

Wow almost 20% up since beginning of the year. Looks shorts will become active, if not already are, here to do their best to save them from the complete ruin. Not that they could make any difference here but it's just a total annoyance not to mention it really screwed up the true info which is the reason most of us come here. The sooner we kill them off the better for all of us.

If you own any TSLA shares this is what you could do. Go to your brokerage and place a limited sell order of all your shares at a very high price, e.g. 1000, to ensure the sell order will not go through. This will mark your share as for sell and be taken out of the pool that your broker can lend to short sellers. This will make the borrowing cost much higher even if they could still find shares to borrow. Yes hasta la vista, baby.

renwo S alset | January 23, 2017

Carl. You mean you haven't already put a $1000 sell on your shares yet?

barrykmd | January 23, 2017

With my luck, the sell order at $1000 will fill and I'll be killed by the capital gains tax.

Mike83 | January 23, 2017

I would suggest 2000 as that is my sell price in the future.

Mike83 | January 23, 2017

I should have added that bargain price is only for 1/3 of my shares.

Pleasanton_Ca | January 23, 2017

@barrykmd, I should be so lucky. Besides capital gains tax will be coming down soon I hope...

Haggy | January 23, 2017

If people can't sell short, they can buy puts. That's fine because they buy them from people like me. On Friday, I had some that I wrote over two years ago with a strike price of 80 expire worthless. There's always somebody out there who is willing to buy something that will end up worthless.

barrykmd | January 23, 2017

Nice, haggy. I've never gone that long (timewise) with options. 4-6 weeks, tops. With the low VIX, and the end of QE, I've taken a break from option writing, which worked very well for the last 5-7 years.

Shesmyne2 | January 23, 2017

Simple fix- pay cash or don't margin your position then the shares can't be loaned.

Still Grinning ;-)

carlk | January 23, 2017

Even as is long term capital gain is still a whole lot better than regular income tax. As for the 1000 sell price the longest sell order I can put for my broker is 90 days not to mention I will change it to 2000 soon as it hits 500.

My purpose is just to let those shorts know don't come here to bother us. We can hit you hard where it hurts so bad you'd wish we have never met.

carlk | January 23, 2017

@Shesmyne2

Are you sure of that? That's not what I understand.

Shesmyne2 | January 23, 2017

Yes. A position needs to be in a margin account to get loaned to the street.
It's technically in 'street name' meaning that they are held in the brokerage name not the individual who bought the shares. The brokerage can loan them as they need.
Unless it's changed in the past 6 years I know this to be true.

Still Grinning ;-)

AlMc | January 23, 2017

Brokerages have different criteria for allowing shares to be sold short from individual accounts but most are just as @shesmyne2 says.

Some shorts have exited recently but more just take their place. Short interest has been very steady over the last several months.

It will be tough to get a big squeeze as many will sell before we get near the ATH.

People here and on TMC don't have enough shares to make a difference.

That being said, I have no problem with seeing a short squeeze. Long overdue.

Only one we have really had is with Jerome's 'reckless growth' announcement at the NAIAS January 2013.

carlk | January 23, 2017

@Shesmyne2

You're right but they could loan your shares long as you have a margin account even though you did not margin your holdings. I believe most people have margin accounts with their brokers. This is the answer I got when I asked Etrade of that.

"Thank you for your message regarding your positions.

While the margin agreement you have completed technically allows us to use your shares to lend, it would have no effect on your holding or ability to sell the shares. If this were to occur and your shares were lent out, we as the broker would then owe you shares so that they will always show as long positions in your portfolio and would be replaced. "

I then searched and found the method I mentioned in the op.

burdogg | January 23, 2017

I don't have a margin account :) I do not want to risk losing my own money, let alone money that is not mine :) I use a cash only account. If I have the cash, I buy, if I don't, I don't buy :)

Haggy | January 23, 2017

You don't have to owe anything on a margin account to have a margin account. You simply have the right to take out more than you have. Plus there are some things that require a margin account even without requiring that you owe anything. I don't owe anything on margin, but I'd rather have a short term margin debt for a cash flow issue than to sell something, get hit with capital gains, and then buy it back. Plus, I never have to worry about a bill payment not going though.

burdogg | January 23, 2017

Very true Haggy - I started with one, and then felt my better judgement was to not even give myself the option. I am new to Stocks etc... so maybe that is why. I also decided I didn't want to short any stock, as I don't want to 1) take that risk and 2) I struggle with the whole concept - sure we need balance, but man, there is a lot of falsehoods and crud smeared on companies just to try to make money by yelling fire for everyone to sell :)

So I agree - I just found for me, pure cash was safer to keep me in check and on the safe side :) (most my money is in a 401k in mutual funds, the stock account i have is my play around money)

carlk | January 23, 2017

@burdogg

You're right you shoud never short or else you will risk having your Tesla rear ended and undrivable at the body shop for months without necessary parts to get it fixed. ;)

sentabo | January 23, 2017

I'm a buy and hold investor for the most part. I have no problem doing what carlk suggests if it truly will contribute to slowing down the shorts.

DonS | January 24, 2017

I wonder how much short sellers have actually made. The ones I hear about have lost money.

I say let them be. If everyone was sure Tesla would go up, there would never be any buying opportunities.

AlMc | January 24, 2017

@sentabo: Not lending out your shares for shorts is certainly has a *noble* ring to it. If you combined all the shares held by members here and on TMC and did not allow them to be lent out, *IMO*, it would have little affect.

@DonS: Shorts who were smart enough to get in at $240, then out sub $200 made money. Shorts piling in now at $250 expect TSLA SP to drop after the Q4ER. Their basis for this is that SCTY financials being incorporated into TM will be a drag on the company's financials. While I don't agree with them there are many people here that felt we would see >$300 SP in 2015 and 2016.

There are smart longs and smart shorts. Many Longs assume all shorts are of low intelligence (investment theory wise) and the opposite is also true.

Old adage: Bulls make money, bears make money, pigs gets slaughtered.

Mathew98 | January 24, 2017

@AIMc + 100

While we bulls love to see the stock skyrocket indefinitely, there are forces on the opposite side just waiting to pounce on any perceived negative sentiments.

Sure, P100D can go 0-60 in 2.5 sec, but it has to slow down and stop at some point. Buy and hold is certainly one way of owning stocks over the long term. But it is not the only way. Just be sensible, whichever direction you think the stock will go...

Mathew98 | January 24, 2017

And @carlk presented a very good measure to keeping shares from being available for the brokerage firms to lend out to the shorts.

However, it would likely have little to no effect because each lender takes in a list of available shares from every other security lending firm and tabulate them into what they think is available on the street. Guess what it looks like when 20 firms have the exact same list? Even if there are really only 1,000 shares available for any particular stock to be borrowed (for shorting purposes), it would be "available" to lend to borrowers 20 times over.

carlk | January 24, 2017

@DonS

I fully agree. I don't think they are making any money and I don't think they could have any effects on Tesla's performance either. A few years back perhaps but Tesla is too strong and established for them to do much now. All I wanted to is to put this on the Tesla forum and tell them don't come here because we could hurt them too. They have the totally opposite goal than ours. Their ultimate goal is Tesla totally wiped out that really annoys me.

@AlMc

In general I'm against trade of any kind including both short and long. Many great investors are buy and hold guys and never do short term trades. It's even more difficult for us little guys to make money by trading stocks. Odds are always in favor of those big guys that could do thorough analysis and rely on computerized tradings not to mention they have ways to manipulate the price. The only way to make money for us, as Peter Lynch or Warren Buffet say, is to find good companies with good products and invest for long term. Both of them said don't try to predict short term variations because no one could. Not trying to brag but I've been doing extremely well by following that.principle. The trick is how to find those companies though. Tesla is definitely the one that stands out.

Haggy | January 24, 2017

I'm generally a buy and hold guy, with the obvious exception of options. However, with options, my strategy is to have a buy and hold strategy as a backup. In other words if any of my written puts do result in shares being put to me, it will be at a price that I consider lower than what I think the stock is worth. Then I can hold on to them for as long as it takes. While it might be true that I would have been able to buy the stock for less at the time the shares are put to me, it's also true that I still keep the premium that was paid to me, and that I would have been willing to buy it at the strike price anyway. So it's not as bad as buying it at that price before it went down lower and then watching it go down, especially if I'm planning to hold it for the long term after that anyway.

The potential risk is that if you write three puts at $200, and the price drops to $190, you might not have $60,000 in cash sitting in your brokerage account. That would have been the situation about a year ago, but rolling the puts forward at a profit was an even better option.

AlMc | January 24, 2017

@Haggy: I agree that options do have a place in one's portfolio if you follow the company(s) and macroeconomics closely.

LEAPS in the place of some stock has given me excellent leverage over a stock only portfolio. From a money standpoint this has worked out very well for me. Short term options are a gamble but are very valuable, especially protective puts, IMO.

To each their own. Buy and Hold is a fine strategy but it is not the only way to make or lose money in the stock market. ;)

carlk | January 24, 2017

@AlMc

Not disagree with you but buy and hold need a lot of patience and discipline which is hard to do especially when you don't have the confidence of what you have picked.

Mike83 | January 24, 2017

I don't do options much anymore but did like writing calls. I found this calculator of interest but don't have recent data to confirm the veracity. Some online brokers have some calculators also. Not sure how well they work.
Writing calls on TSLA risks losing the stock.

http://www.fintools.com/resources/online-calculators/options-calcs/optio...

sentabo | January 24, 2017

carlk - You are correct in that assessment. The stock dropped about 20% (rather precipitously) right after I bought it. It was disconcerting, but I still had confidence in the company---though admittedly I was tested!

Haggy | January 24, 2017

Tesla isn't the kind of company I'd want to write calls on. I'll do that with companies that have stock that seems to be going nowhere even though the company is generally sound, and I can set a price I'd be willing to sell the stock for anyway for shares I own. Yes, it caps my gains, but so does selling it at that price. It also means getting the equivalent of a higher price than the strike price. Early exercise is rare but it does happen. Rolling is often a viable option. I don't write naked calls.

With Tesla there are so many people who are sure that it will tank that writing puts is easy. I never give trading advice in forums and I think anybody who would go by forum advice to make investing decisions is a fool, since I won't be there to say what to do if anything changes, so anybody interested in writing puts would have to decide what strike price makes sense. Two years ago, writing puts at 80 was still profitable for LEAPS. A year ago, so was 150. A few weeks ago 1/2019 puts at 220 were quite lucrative. They still aren't bad. I personally expect Tesla to be way past that in two years, but don't take my word for it. For anybody who bought the 220 puts a few weeks ago, the stock would actually have to go below 175 for them to break even. That's how sure they are.

Mike83 | January 24, 2017

I like your strategy. Doing it in a Roth might work for me. I like to limit my taxes.

brando | January 25, 2017

naked shorts - isn't that how the insiders avoid risk (loses)? Nothing to lose, everything to gain.

Mike83 | January 25, 2017

If the stock is not there then it is naked; stock to back it up is covered. You seem to have it backwards. Why would someone take short term gains when they can take long term gains?

Silver2K | January 25, 2017

this thread is not about @barrykmd, he wears long pants

TPilot | January 25, 2017

Carl just because you have a margin account doesn't mean they can loan your shares. You need to have a debit balance meaning you used you margin account to borrow money. They can loan out 140% of your debit. If you have no debit or a credit balance they cannot loan out your stock.

carlk | January 25, 2017

@TPilot

OK I have no debt balance. I guess my order was not responsible for the squeeze that is going on now. ;) People do have debt balance could still do that. Hit them where it hurts.

TPilot | January 25, 2017

Thing is, most of the shares borrowed (to settle the shorts) come from big institutions and they make money by lending their shares. So instead of their stock sitting around doing nothing they can earn a decent return if loaned out. Especially if they're considered hard to borrow. TSLA isn't as hard to borrow now as it was just a short while ago which leads me to believe the shorts have come down somewhat.

AlMc | January 25, 2017

Be careful/mindful if you lend out your shares; This is from IB:

Notes
1.Important Notice re: SIPC Protection for Loans of Fully Paid and Excess Margin Securities: Please be aware that if you execute loans of your fully paid or excess margin securities, the provisions of the Securities Investor Protection Act of 1970 may not protect you with respect to the securities loan transaction. Therefore, the cash collateral credited to your account by Interactive Brokers (see above) may constitute the only source of satisfaction in the event that Interactive Brokers cannot return the securities.

TPilot | January 25, 2017

AIMc good point but the collateral should equal or exceed the value of the stock.

Mike83 | January 25, 2017

A rapid move up could wipe out equity in an instant. Not sure what the broker does if the shorting client goes bankrupt.

Haggy | January 25, 2017

The rules for IRA accounts and options are different. In general your broker will give you limited options trading ability depending on your experience and balance. With an IRA, you can't execute a transaction that might have to make use of money that isn't there. So for a written put, if you'd be able to do it at all, you'd probably need enough cash to cover the shares if they went down to zero. They will likely allow covered calls though. You might be able to buy puts for shares you have. But why would you want anything in an IRA that you expect to go down?

"A rapid move up could wipe out equity in an instant. Not sure what the broker does if the shorting client goes bankrupt."

For margin, you can only use less than half the equity you have. If your broker sees things going out of the money too fast, he could close positions for you without asking you. It won't matter what he picks. You will have no choice. If things bounce back a day later, too bad.

I'd advise not to use options to gamble. You should have far more credit/assets than you are willing to risk. The puts I write on Tesla are less risky than buying the stock outright at the strike price and I can't predict short term movements. I can say that if they result in the price dropping to a bargain, I don't mind ending up with shares that I expect to go back up. If I didn't have the money there and didn't have enough margin, if I had shares put to me, my broker could sell anything else to pay for them.

Mike83 | January 26, 2017

Good comments. BTW I just read that the Short stock interest increased from 34 to 35 million shares. I like that.

carlk | January 26, 2017

Incidentally NFLX has been the most shorted stock for a long time before TSLA. While shorts come and go the stock has risen 100x since I bought my first share in 2002.

justin.daffronte | May 30, 2019

Hey Tesla Team let's rekindle this post on how to kill the shorts... If You have TSLA in your brokerage account it is important to put that sell order in or your online broker can profit by lending out your shares without your consent. I FINALLY did it today! Thanks Forum for the advice!

Tropopause | May 30, 2019

I did it as well. Hope this info will spread and get folks to take action.

Mathew98 | May 30, 2019

GTC order is only good for up to 60 days. Just rinse and repeat every 2 months...

sentabo | May 30, 2019

I just tried to do this in my brokerage account (Fidelity) and received this message: "Error:(00906B) The limit price you have entered is too far away from the Bid Price for this security. Please use the following guidelines when entering your limit price: For sell limit orders in which your limit price is above the current Bid Price, your limit price can be no more than 50% away from the Bid Price."

The highest price I could go was $283.

Tropopause | May 30, 2019

I put a limit price of $10k and it's good for 6 months with Merrill. Although I like Fidelity as well, it sounds like they're in the business of keeping the shorts protected if they're only letting you go 50% above the current rate.

dougk71 | May 30, 2019

The SEC has had an interest in Elon. The SEC should also be looking into the sort seller volume. The short volume is disproportionately large ( 30%) relative to other stocks ( maybe around 3%). The purpose of short sales is theoretically to moderate volatility in transactions by hedging the downside risk. Today the SEC has muzzled Elon and given the short sellers the stage to say anything true or not. The SEC needs to restrict shorts to 10% of the available trading stock .

p.c.mcavoy | May 30, 2019

When I saw the title of this thread my very first thought was if someone had figured out a way to prevent Silver2K from ever posting any links.

For those that don’t get the inside reference ... consider yourself warned. NEVER open any links posted by Silver2k, no matter how innocent it might appear.

Garn | September 1, 2019

"dougk71 | May 30, 2019 The SEC has had an interest in Elon. The SEC should also be looking into the sort seller volume."
Amen brother! Something much larger is going on there than Elon's tweets.
I think we should all file a complaint with the SEC asking them to review the short selling. Legally they have to, will any thing come of it, probably not. But you get nothing if you do nothing. You can file right on their site.
Look at "Know you Know"
youtube .com../watch?v=vfILTM_xcOE
And Jack's follow up. (We need to act!)
youtube .com../watch?v=Wv_XcxpRuTw
Pretty much spells out a case, at the very least, to be looked at by the SEC.

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