Tesla Inc’s stock is trading lower as investors weigh the implications of the company’s latest product launches against broader market concerns.
Introduction of New Models
The electric vehicle maker officially unveiled its more affordable “Model Y Standard” and “Model 3 Standard” vehicles. The new Model Y Standard starts at $39,990, a strategic move to attract a wider customer base, especially following the recent expiration of the $7,500 U.S. federal EV tax credit.
Investor Concerns
While a lower-priced vehicle could boost sales volume, the stock’s negative reaction suggests investor anxiety about shrinking profit margins. The market could be concerned that the introduction of a cheaper model may cannibalize sales of higher-margin trims. The move could also signal weakening demand in the face of increased competition and a challenging economic environment.
Recent Performance
The launch follows strong third-quarter deliveries for Tesla, but sales figures may have been inflated by customers rushing to buy before the tax credit expired, potentially leading to a slowdown in the coming months. Investors will be closely watching Tesla’s upcoming earnings report for further insight into the company’s profitability.
Stock Performance
Tesla shares were down 3.97% at $435.24, according to recent data. The stock is trading near its 52-week high of $488.54 and well above its 50-day moving average of $366.40, suggesting a strong uptrend over the medium term. However, Tuesday’s drop may indicate a potential pullback. Key support levels can be observed around the 200-day moving average at $334.41, while resistance is evident near the recent high of $452.68.
Buying TSLA Stock
Buying shares is typically done through a brokerage account. Many platforms allow you to buy “fractional shares,” which enables you to own portions of stock without buying an entire share. In the case of Tesla, $100 would buy you 0.23 shares of stock.
Betting Against Tesla
If you’re looking to bet against the company, the process is more complex. You’ll need access to an options trading platform or a broker who will allow you to “go short” a share of stock by lending you the shares to sell. Alternatively, if your broker allows you to trade options, you can either buy a put option or sell a call option at a strike price above where shares are currently trading — either way, it allows you to profit from the share price decline.
Conclusion
Tesla’s stock decline following the introduction of new models has sparked investor concerns. As the company navigates the challenges of increased competition and a changing economic environment, investors will be closely watching its upcoming earnings report for further insight into its profitability.