Is Tesla A SCAM?

Is Tesla a SCAM?

Is Tesla a scam?

Tesla is definitely not a scam, however I believe that it's extremely overvalued. 

Tesla has a Rockstar CEO and if you look at companies, or products, that have a history of developing a cult-like following they almost always disappoint (over the long-term).

Bitcoin is currently trading more than fifty percent below its all-time high, and almost all NFTs that were previously hyped are now worthless.

I believe that if you removed Elon Musk as the CEO of Tesla then it'd probably be worth around $100 billion dollars, instead as of late November 2023 it's worth about seven times that amount.

While Tesla may be overpriced at the moment, there are still ways that you can make significant profits from Tesla.

Selling a put option on Tesla with an expiration of about three to four weeks out and a strike price of about $190 is a great way for you to potentially profit from the recent pullback in Tesla.

Tesla is trading almost 50% off its all-time high and due to its high implied volatility and high implied volatility rank there's a lot of available premium for you to collect by selling options on Tesla.

Tesla Options Trading Strategy

Using options is much more capital efficient than owning stock.

And when you use portfolio margin, you're able to realize about 6x greater capital efficiency than when using stocks.

If you want to go synthetically long the stock while also realizing the capital efficiency of using options, instead of actually taking ownership of the stock, you can sell an at the money TSLA put option and buy an at the money Tesla call (choosing an expiration of about three to six months for both options).

In this situation you'll give yourself enough time to be right to profit from the upside potential of the actual stock.

Is Tesla a Scam? Scotty Kilmer

Scotty Kilmer is a popular YouTuber and mechanic who has a good reputation.

He believes that Tesla makes garbage products.

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Is Tesla a Buy?

So, is Tesla a buy?

Personally, I wouldn't buy it.

Tesla is trading around 30% off its YTD high and almost 50% below its all-time high.

Plus, its margins are shrinking and it's dependent upon government subsidies.

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Is Tesla a good investment for 2024?

Long-run, there are safer, less volatile investments.

If you believe in Tesla, then it's probably best to limit it to no more than 10% of your portfolio due to the volatile nature of the stock.

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Is Tesla a Scam (Conclusion)

No, Tesla is not a scam, but it is probably overvalued and you may experience significant price volatility in the stock in the future.

**IMPORTANT** - This article is NOT investment advice. Trading options and / or investing in stocks carries risk. This article simply shares my thoughts and should never be considered investment advice.

Frequently Asked Questions (FAQs)

What is Tesla trading at?

As of November 6, 2023, Tesla is trading around $220 / share.

Did Tesla recently have a stock split?

Tesla hasn't had a stock split in 2023.

What happens if Tesla stock price keeps going down?

If you believe that Tesla will continue to go down in price, then it would be wise to not buy it.

How Can I Learn More About Options Trading?

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Should I Trade Options During a Bear Market?

Yes, if done correctly, then trading options will enhance your returns and allow you to beat the market.

Is Elon Musk a fraud?

No. He has a big mouth and is a bit strange, but I believe he has good intentions. He doesn't seem like a bad person and he seems empathetic and genuine in his desire to help humanity.

Is Tesla bad for the environment?

Probably. Lithium mining is very bad for the environment and electricity production is still dirty. Plus, the batteries are extremely heavy and are rarely recycled.

So, overall, electric cars are probably just as bad, if not worse, than gas engines.

What Tesla scandals are there?

Tesla seems to overcharge their customers and limit the car ranges. Plus, regular mechanics cannot work on Tesla cars.

Plus, Elon Musk is oftentimes involved in a lot of distractions, most of which originate from his large ego.

Finally, Tesla cars are not good for the environment and they may be worse than internal combustion cars.

Even so, no one is perfect and I believe that Elon Musk has positive intentions (especially when it comes to protecting civil liberties).

About the Author David Jaffee

I (David Jaffee) help people become consistently profitable traders while minimizing risk. I graduated from an Ivy League University and worked at some of Wall Street's most successful investment banks. Subscribe to my YouTube channel for valuable videos - BestStockStrategy YouTube Channel‚Äč. Finally, if you're looking to Land a Finance Job, then I've put together the best step-by-step course at LandaFinanceJob.com. My personal website is DavidJaffee.com.

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