One month ago, Tesla stock price was at $168. It increased 54% over the past month to the current price of $263.

I held 6,000 shares a month ago, with a market value of $1,000,000 USD. My cost was higher than $168, so my investment showed a large paper loss.

My Tesla investment increased by $540,000 USD in a month. It erased my loss and now showed a profit. I have since reduced by holdings to 2,500 shares.

What caused the sharp rise of 54% in the stock price in a month?

There were two reasons:

a) The stock was grossly undervalued a month ago, due to short selling. I consider that a fair value would be $200 instead of $168.

b) Currently, the stock price is overvalued. The PE ratio is now 74 times. This is the reason for my decision to sell 60% of my holdings.

The 3,000 shares that I sold during the past week caused me to miss $45,000 of potential gain.

Never mind. We win some, we lose some.

Tan Kin Lian