3. So far their buying has driven the price up from $280 to as high as $540
- and this has also drawn in a lot of new and eager retail investors with FOMO
5. At this point they can see the possibility of “cornering the market” in Tesla shares because there is obviously so much buying demand, with more Dumb hedge funds and new retail investors jumping in
They have just split their shares to improve the pricing and access for their employees and small retail investors
And they have no reason to allow the S&P action to drive this speculation in their stock
And they show just a small amount of new supply as the warning signal
- just around 1% of the total shares outstanding
This is a warning signal to the speculative hedge funds who were going to lock up their TSLA shares to make the “long squeeze” work
It basically tells them that TSLA will not let that game play out
The hedge funds would not be deterred by that alone
But Tesla’s fire power in this game is essentially unlimited
They could easily do 10% or $50 billion
And the ease of making an 8-K filing shows that they are ready
So Tesla is saying “don’t try it, buster . . . don’t even think about it . . . or you’ll make my day”
- classic Clint Eastwood
- so we know that there are still “greater fools” out there who are still buying into a short-term game at $475 and $420 that was only worth buying into at $300
- in this extreme case Tesla can unleash something like $50 billion of new shares to real buyers in front of them and stop their stupidity
- but we will just have to see how Dumb the remaining hedge funds want to be
- the Smart ones will likely have left the party by the end of this week
- as this is not likely to be a safe place for smaller investors to try and be active, before the storm of uncertainty has passed