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inthemoneystock (< 20)

End Of Quarter Trick That Tells Us To Short Tesla Motors Inc



September 30, 2013 – Comments (3) | RELATED TICKERS: TSLA

Tesla Motors Inc (NASDAQ:TSLA) is quickly approaching $200 per share. There is one key reason to short this stock and it has nothing to do with technical or fundamental reasons. Simply put, into the end of this quarter (ending today), millions of shares are being bought in Tesla for window dressing. Simply put, window dressing is one of the biggest tricks perpetrated by fund managers around the world. Essentially, fund managers want to show their clients (all the average investors who have invested with them) that they owned the top performing names for the quarter. One of the best performers has been Tesla Motors. Therefore, they buy the stock into the end of the quarter. This creates an artificial bid on the stock and it moves higher. Investors see it on their statement and rejoice, not knowing it was bought at the very end of the quarter at all time highs. Once the new quarter starts, these fund managers can dump it or cease to buy it. Is this legal? Yes. Is it ethical? No. As a swing trader, we can use this to our advantage. I will look to short Tesla Motors on a break of $200 a share. This will be a near term short trade that should give profits within a week or two. I expect approximately a 10% pull back, possibly more.

Gareth Soloway


3 Comments – Post Your Own

#1) On September 30, 2013 at 2:49 PM, alexf (< 20) wrote:

I don't play those games. They are indeed unethical.

For me, a blip in one end of quarter move is just that, a blip. Who will remember, or care, a few months and years from now? Long TSLA. Fool on.

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#2) On September 30, 2013 at 5:54 PM, awallejr (39.43) wrote:

Still waiting to hear how the Nflx short worked out for you Gareth.

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#3) On October 01, 2013 at 11:17 AM, Valyooo (34.17) wrote:

I never understood that. How stupid does an investor have to be to say "oh wow my fund owns all these great stocks! Wait why aren't my returns that good then?"


i would care care only about my returns and not what my fund owns 

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