Vaccine Trial Anecdote, Battery Day Sell-Off, Precious Metals, Stock Q’s

Well, as we saw TSLA get slammed from the $450 level it was at heading into the much hyped Battery Day event — well, that’s why I talked about hedging it so often. Recall that TSLA got slammed after last year’s Full Self-Driving Day. The stock is up huge since those lows of course. As noted below, I’ve rolled down a few put hedges and covered some of my short calls on TSLA in the hedge fund — but as usual, I’d suggest mostly sitting tight right now.

One of my hedge fund partners (and long-time Trading With Cody subscriber) joined the Moderna vaccination trials. Are any of you reading this also involved in any Covid vaccine trials? If so, please let me know by hitting reply to this email. Here’s the latest exchange we had about it this week:

Partner: Got my second and final dose yesterday. Side effects started within about 5 hours and they are an ass kicker again and lasting longer. Fever of 100 degrees, moderate arm pain and generalized aches and pains everywhere. Feel like I have been run over by a truck but I’m hoping the side effects only last about 24-48 hours. First shot lasted 14 hours of side effects.

Me, the next morning: How are you doing?

Partner: Feeling better today. Fever is gone, arm still sore and still some body aches but definitely better than yesterday. It’s the inflammatory response that these mRNA vaccines cause that cause these side effects. I would imagine subsequent versions, in the years ahead, they will figure out how to lower the inflammatory response while still giving you the immunity to the virus.

Me: Can I share this with my subscribers:

Partner: Absolutely! Overall my experience with the testing site has been very good.

I actually feel great right now. It is so interesting how you suddenly feel like crap and then just as quickly as it hits you then it goes away. I would equate it to feeling like you have a pretty bad case of the flu (fatigue, fever, chills, muscle aches and moderate to relatively severe injection site pain) but unlike the real flu you have no sore throat, no cough, no problems breathing. So I guess it’s like the flu without the respiratory issues.

But as I said, I am now 44 hours post injection and I feel great. So first shot was about 14 hours of feeling crappy and 2nd shot was about 40 hours of feeling crappy. I will add, I was still able to go to work each day as long as I took Tylenol or Motrin. But if I had to do it all over again I would get the shots on a Friday so you would have the weekend to recover.

Hopefully we are one step closer to getting out of this Covid nightmare.

On a markets-related note, the market’s intraday volatility is making those daily candle sticks on the charts I talked about in the “Don’t Be a Chicken” article continue to make me uncomfortable with the markets overall. I might be less cautious and not hating the stock market any more, but that doesn’t mean I’m outright excitedly bullish. Stick with the gameplan. Steady as she goes.

And here’s the transcript from yesterday’s Live Q&A Chat.

Q. Hey Cody. If you were just starting out, are there 3-5 names that you would nibble at these levels or wait for them to come down to your recent buy more prices? Thanks.

A. I’d probably start with some TSLA while it’s being crushed today. Maybe some QCOM, FB, GOOG, CRSP, PINS, TSM and maybe a few others. I don’t think I’d start with just three, but start small and patient with tranches giving yourself time and space to add more in coming weeks.

Q. Cody as we are speaking real time any stocks presently to nibble on and or sell?

A. See prior answer above. There’s a lot to start nibbling on if you feel like you don’t own enough of some of these names. Patiently though.

Q. Any particular reason you feel compelled to add to PINS as it breaks new highs? Not your usual MO.

A. Yeah, just because I’d want to spread out my buying to some of the momentum names moving higher in answer to the question about what I’d do if I were just starting out investing.

Q. Are you making any trades today?

A. Not much other than managing some of the TSLA hedges.

Q. Cody. do you think a second Covid wave is inevitable this fall/winter? Europe seems to be getting worse.. I am actually looking to short some hospitality stocks.

A. I don’t think anything with Covid is inevitable, but the odds are looking not good in hoping the world and the US avoid a second wave.

Q. What do we know after Battery day that we didn’t know before Battery day?

A. Good question. We know that Tesla is re-inventing every aspect of the battery, from mining to production to literally building the battery case into the body of the vehicle. The ability to scale battery production and remove half the costs of the batteries would truly enable gross margins on the higher priced cars to go through the roof and for Tesla to profitably sell a $25,000 low end car in a few years too.

Q. 40% of my play IRA is in Tesla, I’ve sold none since the split. I’m very long TSLA but I think I can’t own enough Amazon. I’m an M3 own and watch TSLA go public in 2009.

A. If you can handle the risks and potential for more pain from TSLA, I guess you can hang tight. I think that’s way too much exposure to any one stock though, personally.

Q. Cody. F2F, where would TWTR be in one or two years?

A. Feet to fire, I’d guess that TWTR’s stock price will be at about $60 next year sometime and maybe more than that in two years.

Q. Do you feel SNE still a hold here with microsoft going all in withg their new purchase?

A. What if I typed here: “No, I think SNE is a sell, but I didn’t want to tell anybody!” Surely, you know I’d send out a Trade Alert if I thought we should sell SNE. Softee’s small purchase of a small games developer doesn’t change anything for either MSFT or SNE.

Q. Hi Cody, Hope you and family are well! Q. How about DAVA and PS?

A. I just looked at both quickly and neither one stood out to me. One based in Britain, the other seems a specialized product for software businesses to manage employees? I don’t know. Didn’t light my fire at a glance.

Q. Is DVAX a buy here? I have a decent size position already, sold 20% when it was 11+

A. I’m mostly just sitting tight with the remaining DVAX for now. I would like to have seen an update that the company’s trials are moving along meaningfully before buying any shares back, even if I’d have to pay a higher price later.

Q. Would you say current weakness in precious metals makes it a good time to buy more?

A. If you don’t own much gold, I’d sure consider taking advantage of the current pullback in prices to nibble some. I’m not as keen on silver or other precious metals besides gold.

Q. I had 2 doctor appointments last week. Both were over net. Loved it. No traffic. No getting there early just to wait a half hour. 10 minutes and was done with both. I think it is here to stay long after Covid. I have a decent amount of LVGO so default I have TDOC. Thoughts on TDOC?

A. I’m not sure I believe TDOC to be as great a pureplay as others do. I do believe what you described is the future of doctor visits, but TDOC is fishy.