Twitter And Tesla: Musk-Driven Pair Trade Has Lived Up To Our (His) Wildest Dream (Nightmare)

Summary

  • We suggested a Musk-driven pair-trade: Buy Twitter and sell short Tesla.
  • Musk has lived up to each and every expectation we had from him, and the trade has lived up to each and every target we set for it.
  • Earlier this week, the pair-trade fulfilled its mission. It was time for us to take profits, as well as to follow-up on the story.
  • Nonetheless, this isn't only a look back at how this pair-trade has evolved, but also a look into the future: How the story of Twitter and Tesla may evolve from here going forward.
  • Join us for this "Back to the Future" special performance featuring the (Tesla) movie (theater), the (Twitter) musical (chairs), and a "Fortune Teller" like you've never seen before!
  • Looking for a portfolio of ideas like this one? Members of Wheel of Fortune get exclusive access to our subscriber-only portfolios. Learn More »
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On July 1 we suggested an Elon Musk-driven pair trade: Buy Twitter (TWTR), Sell Tesla (NASDAQ:TSLA).

Here's what we wrote back then (July 1), in a nutshell, followed by what has happened and how things have evolved since then:

Twitter

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This article was written by

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On a strictly formal note...


The Fortune Teller ("TFT") is a well-known contributor on Seeking Alpha ("SA"), and a top blogger according to TipRanks, with over 30 years of deep and direct market experience.


TFT is the leading moderator of two services on SA: Wheel of Fortune and Macro Trading Factory (led by TFT's "mirage identity" called The Macro Teller, or "TMT")


TFT is an account that represents a business which is mostly focuses on portfolio- and asset- management. The business is run by two principles that (among the two of them) hold BAs in Accounting & Economics, and Compute Sciences, as well as MBAs. One of the two is also a licensed CPA (although many years have gone by since he was practicing), and has/had been a licensed investment adviser in various countries, including the US (Series 7 & 66).

On a combined basis, the two principles lived and worked for at least three years in three other-different countries/continents, holding senior-managerial positions across various industries/activities:

On one hand/principal, IT, R&D, Cloud, AI/ML, Security/Fraud, Scalability, Enterprise Software, Agile Methodologies, and Mobile Applications.

On the other hand/principal, Accounting, Banking, Wealth Management, Portfolio Management and Fund Management.


Currently, they run a business which is mainly focusing on active portfolio/fund/asset management as well as providing consulting/advisory services. The business, co-founded in 2011, is also occasionally getting involved in real estate and early-stage (start-up) investments.


The people who work in and for this business are an integral and essential part of the services that we offer on SA Marketplace platform: Wheel of Fortune, and Market Trading Factory. While TFT (or TMT for that matter) is the single "face" behind these services, it's important for readers/subscribers to know that what they get is not a "one-man-show" rather the end-result of an ongoing, relentless, team effort.


We strongly believe that successful investors must have/perform Discipline, Patience, and Consistency (or "DCP"). We adhere to those rigorously.

The contributor RoseNose is both a contributing and promoting author for Macro Trading Factory. 


On a more personal note...


We're advising and consulting to private individuals, mostly (U)HNWI that we had been serving through many years of working within the private banking, wealth management and asset management arenas. This activity focuses on the long run and it's mostly based on a Buy & Hold strategy.


Risk management is part of our DNA and while we normally take LONG-naked positions, we play defense too, by occasionally hedging our positions, in order to protect the downside.


We cover all asset-classes by mostly focusing on cash cows and high dividend paying "machines" that may generate high (total) returns: Interest-sensitive, income-generating, instruments, e.g. Bonds, REITs, BDCs, Preferred Shares, MLPs, etc. combined with a variety of high-risk, growth and value stocks.


We believe in, and invest for, the long run but we're very minded of the short run too. While it's possible to make a massive-quick "kill", here and there, good things usually come in small packages (and over time); so do returns. Therefore, we (hope but) don't expect our investments to double in value over a short period of time. We do, however, aim at outperforming the S&P 500, on a risk adjusted basis, and to deliver positive returns on an absolute basis, i.e. regardless of markets' returns and directions.

Note: "Aim" doesn't equate guarantee!!! We can't, and never will, promise a positive return!!! Everything that we do is on a "best effort" basis, without any assurance that the actual results would meet our good intentions.


Timing is Everything! While investors can't time the market, we believe that this applies only to the long term. In the short-term (a couple of months) one can and should pick the right moment and the right entry point, based on his subjective-personal preferences, risk aversion and goals. Long-term, strategy/macro, investment decisions can't be timed while short-term, implementation/micro, investment decision, can!


When it comes to investments and trading we believe that the most important virtues are healthy common sense, general wisdom, sufficient research, vast experience, strive for excellence, ongoing willingness to learn, minimum ego, maximum patience, ability to withstand (enormous) pressure/s, strict discipline and a lot of luck!...

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: TipRanks:
HOLD rating for TSLA (Short position closed)
SELL rating for F, GM, HMC, LCID, LI, NIO, NKLA, PSNY, RIVN, TM, TTM, XPEV
BUY rating for META, PINS

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