Tesla is just one of those unpredictable stocks. They operate in a fairly new industry creating products that the world has never seen before.
On top of that they have a CEO influencing the stock price via Twitter.
The investing world won’t be forgetting the below Tweet in a hurry.
At a time when the stock was trading at $380 per share, Musk put out a tweet claiming that he was going to take the company private and had buyers willing to pay $420 per share!
Afterwards, the stock volatility went crazy, dropping by up to 20% in a few weeks.
And of course we have the haters. Well, maybe not haters but there is a market of people who have shorted the stock with a total value of $8bn.
That’s $8bn people have lost because they went against the company.
So, if a company is so volatile and unpredictable, how on earth could anyone see this massive bull run?
There are only a few powerful indicators that can accurately predict the future price of the stock.
One of the most powerful indicators is when the CEO, Executives or board, reach into their own pocket and buy stocks in the company.
And it has to be them actually paying from their own pocket. If management are issued stock options, it’s not the same.
They don’t have their own money on the line.
It’s a strategy that I utilised to invest in Billabong at 16c a share and sell out for a 300% gain at 64c.
Billabong were getting hammered due to massive debt and shareholders losing faith in the company.
It was when the stock price hit 32c a share that I noticed key executives in the business started buying up stock.
Now this isn’t an immediate turn around as it takes time to implement strategy.
I bought in at 16c a share. The stock went to 10c before I sold out 64c in a short period of time.
This is exactly what happened at Tesla
In 2018/2019 Elon Musk purchased $55m worth of Tesla stock.
Now $55m is a MASSIVE amount for any individual to buy and is a powerful indicator on where the company is headed.
We emailed our Private Investor Club members in October notifying them of Musk’s stock purchases.
At the time the stock was trading at $237 per share with a high end target at $530.
Our smart members who jumped on the opportunity would have doubled their money in just 3 months…..
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