Bull Market for Electric Cars

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Are all-electric vehicles the future? The market seems to think so, as both Tesla Motors and its Chinese competitor Kandi Tech have been among the best performing stocks in the past year and a half.

Tesla has finally entered China, which is considered to become a major growth hub for them.

This morning, shares of Tesla are trading lower in pre-market on news that its vehicles won’t qualify for Chinese tax breaks.

If you ask me, the Chinese who could afford Tesla, don’t need tax breaks and it probably won’t affect their decision-making. Tesla is still a luxury vehicle. The more expensive it is, the better it will sell, at least for now.

Besides, take a look at a Tesla and compare it to Kandi:

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The True Nature of the Market

The stock market is not a place, where for one party to win, another has to lose. It is a place, driven by cycles – periods, when almost everyone is a winner followed by periods, when almost everyone is a loser.

Everyone could make a lot of money during market rallies, when liquidity and performance chasing lift all boats and trump all bad news. Not everyone keeps that money when the inevitable correction comes.

Don’t get me wrong. Corrections are an important part of the market cycle. As legendary money manager, Peter Lynch once said:

It is not entirely clear what causes deep market corrections, but without them many of the best performing long-term investors would have never achieved their spectacular returns.

(the same notion applies to swing and position traders, too)

I have nothing against market corrections. I have a lot against giving back my profits during market corrections. Over time, I have learned to time my market exposure – there are periods, when I am barely invested and mostly in cash, followed by periods when I am very aggressive and using leverage to take advantage of a favorable market.

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Why SuperStar Traders Sometimes Fail?

There have been quite a few cases in recent years, where extremely successful prop traders leave their banks to launch hedge funds, only to see their performance drop substantially. Venture Capitalist and entrepreneur, Marc Andreessen, started the theme yesterday on Twitter and I thought some of the answers really shed a light on the major reasons: