We only need to look at the fall and rise of Tesla to see how fickle investors can be. Less than 12 months ago the talk was that Tesla was going bust, short of cash and short of sales. Fast forward just a few months and the shares increased fivefold from the low before falling back. Shorters were burnt, bulls were celebrating and seemingly all analysts now see Tesla as “the stock” of the future. What happens next week if the company issues disappointing sales figures?
Investors are very fickle and at some point Tesla will fall out of favour and all of the old negative stories will re-emerge. The key is to buy when shares are out of favour, sell when they are in favour before their return to more “traditional valuations”.
