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> Or if you want a single metric, look at the after-hours stock movement. I think this is a good rule of thumb, but for famously volatile securities (Tesla, Bi
by OnlineGladiator 7y ago
> Or if you want a single metric, look at the after-hours stock movement.
I think this is a good rule of thumb, but for famously volatile securities (Tesla, Bitcoin, etcetera) you are really just swimming in a sea of irrational exuberance and nobody knows how it's going to end. Maybe Tesla will be the world's richest company in 10 years. Maybe Tesla will go bankrupt in 2. I don't know, but looking at Tesla stock trends doesn't tell you anything other than how unstable it is.
- AznHisoka 7y agoAlso short term stock movements, especially after earnings can be due to Keynesian beauty contests. you think other people think the headline is positive. even if you think the actual results are bad, you still buy because the price is dictated by the greater fools, not you.
- paulpauper 7y agoyeah there is randomness but the companies that tend to go away often have a fatal flaw, such as being dependent on a single customer, or are fads, or have cut throat competition and tiny margins. This is why clothing companies are such bad investments compared to information tech. Tesla has none of those problems.
- OnlineGladiator 7y agoME: It's not a good idea to look at stock trends for anything super volatile. YOU: Tesla doesn't have problems like other stocks. How is this relevant?
- xkjkls 7y agoAfter Hours can be low volume and not entirely indicative. The full next day of trading is usually a much more sober indicator.