Wednesday, May 15, 2013

Tesla (TSLA) - May Skew Stays Parabolic; Vol Diff Opens... And Some Stuff You May Not Have Known...

TSLA is trading $84.52, up 1.5% with IV30™ down 7.4%. The LIVEVOL® Pro Summary is below.


Click for Free Trial


Tesla Motors, Inc. is an electric vehicles and components manufacturer. The Company manufactures electric vehicles and electric vehicle powertrain components.

I just wrote about TSLA six days ago (May 9th). Here is that post:

Tesla (TSLA) - Earnings Explosion Spectacle Hides Vol Shift -- This is a New Company -- A Paradigm Shift is Complete

In all fairness, that one is a more compelling argument for the long run. This article surrounds the immediate-term; namely the next 2.5 trading days. This is a calendar spread note - and yes, I know how close we are to expiration, but you gotta see this vol in May.

One quick update before we get going... After I wrote the post on May 9th, I actually walked into a TSLA dealership and spoke to a salesman.  He was a shareholder (or so he said).  I have no idea if what he said was true, or if it is already common knowledge, but according to him the firm sold 2,600 cars last year, and this year they are going to break 20,000.  The cheapest model is $70,000 and the most expensive is $113,00.  They are at full capacity -- which according to him was 500 cars per week -- and every car made is to order so production = sales.

Further, at this point TSLA has one version -- one car -- in nine colors (or whatever). They are introducing a new model and... a right hand sided version of the current model (yeah, that would mean Europe).  He also said the cars have ~470 HP -- or essentially, they are electric Lamborghinis with 300 miles to the battery charge which costs ~$9 when on absolute empty to recharge (in 8 hours).

Now onto the article at hand...

Let's start with the one-year Charts Tab below. The top portion is the stock price, the bottom is the vol (IV30™ - red vs HV20™ - blue vs HV180™ - pink).

On the stock side we can see the absolutely awesome price appreciation.  At some pint during this year, TSLA was a $25 stock.  It isn't anymore...

But anyway, this is a quick time spread note, so let's look at the Skew Tab.

I mean, it's pretty easy to see -- the red curve is well above the yellow curve (May is well above Jun).

Finally, let's turn to the Options Tab, below.

Easy enough -- look at the top of the Tab.  May vol is priced to 123.62% while Jun is priced to 82.63%.  That parabolic shape in the May skew is apparent in the OTM call vol pricing.  The May 95 calls (for example), are priced to 135.5% vol or $0.55 bid.  Whoa...

Follow Live Trades and Order Flow on Twitter: @Livevol_Pro

This is trade analysis, not a recommendation.

Legal Stuff:

No comments:

Post a Comment