Tesla (TSLA) surged more than 20% post earnings as CEO Elon Musk delivered an encouraging forecast and revealed surging sales in his electric vehicle company. Shareholders enjoyed the biggest single-day pop in TSLA in over a decade, rising to a session high of $262.12.
Massive volume of over 200 million shares ( three times average volume) states that the nearly $20 billion (notional value) of short positions raced to the exit door. This short-covering created a significant increase in volatility making option premiums increase lock-in-step. I want to use this elevated option premium to create income on this refurbished Mag 7 member.
( See what Kilburg did going into earnings here. ) Volatility is a known characteristic for Tesla as the stock has a beta of 2.29, more than double that of the S & P 500.
And Tesla earnings have historically created volatility in the stock. Prior to the earnings report beat, options markets implied shares were going to fluctuate about 6% (up or down) following the third quarter earnings report. Shares have moved an average of about 11% following the past four quarterly reports.
TSLA YTD mountain Tesla, YTD Musk, the world's richest man, now has the ability to move his little EV company into the trillion-dollar club as the market cap for Tesla now sits up above $800 billion. Tesla also confirmed that it produced its 7 millionth electric car this week. Tesla produced its millionth vehicle back in early 2020 after 16 years of existence.
In the subse.
