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Comment by codeulike | Hacker News Reader

.... making almost $3B in profit.

edit: in perpective - they owned about 0.55% of Tesla. Selling their share nets Panasonic a windfall thats worth about 10% of their own $27.7B market cap.

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Yeah "dumping" a winning trade isn't dumping. It's taking profits to move onto other investments.

Why not? It’s still dumping. Saying that someone is only dumping if they lose, makes it too narrow.

Dumping lowere the price, the bigger the dump the lower the price. Selling slowly can be called gradually unloading.

"Panasonic realized exceptional gains on Tesla investment, continues successful partnership."

Edit: Money made is money made. Lots of wealthy folks who exited investments before they were done running.

Dumping is half of pump and dump. Which if you do it right is making a profit. (I don't think this trade is pump and dump, just arguing usage with a commonly used term)

Dumping a winning trade is still dumping.

It means you think you have won as much as there was to be won and you now have better uses for the money. This suggest you believe the stock is no longer as wortwhile as some alternative.

When Amazon sell you a printer or a book or a laptop, are they dumping it?

A seller could certainly dump unmoved inventory on any marketplace.

If they're selling me their entire inventory of one particular item, and do not intend to purchase more of it - maybe?

Yes?

If Amazon thought the items in its warehouse were appreciating, I fully believe they'd decline to sell at a lower price.

So selling = dumping?

Edit: ok so dumping=selling the whole lot

I guess that makes sense. I think this post explained it better https://news.ycombinator.com/item?id=27633163

No it is not. Stop trolling or go learn financial slang. It is not hard, you can google it.

I worked on an exchange and currently with trading systems for one of the largest banks in the world.

I mean, yeah, but at the same time, stocks are different from inventory because they (can) appreciate in value. Inventory in a store depreciates over time.

There are two and a half reasons to sell a stock: because you need the cash, or because you think the stock has stopped appreciating and will depreciate going forward.

Once a stock has become a depreciating asset it's really no different than the bedroom set that's been sitting in the corner of the showroom for too long, and before too long they'll be happy to take 50% or 40% or less of what they were originally asking just to get it off their hands, even if they end up selling at a nominal loss at the end.

So I'd argue that a stock being "dumped" really is no different than a printer being sold, but that that doesn't look any better for the stock than the negative term would suggest.

Just want to point out that you've got insider knowledge and if you want people to be better educated about distinctions and jargon you gotta educate them. Just referring people to the great oracle called Google leads to the bad old days of googling a question and only getting threads where frustrated specialists snarkily suggest googling instead of asking.

Really though, the hardest part of googling the answer to a question is knowing what to call things and how to phrase your own questions. Google "is amazon dumping printers", its about E-waste and recycling. Of course, you wouldn't do that because you know better, but thats sort of the point. You are the one who knows better, not the questant who is sort of confused definitionally.

> and if you want people to be better educated about distinctions and jargon you gotta educate them

I literally did that in parent post and another earlier response to the same person.

Your credentials aren't really relevant unless you're making an ad hominem argument to the effect that we should believe everything you say about finance because you're an authority.

Use of slang or jargon in a headline only subtracts points, in my gradebook. And if dumping is mostly just selling, why not say selling? Well the answer is "because clickbait." A devaluation, insult, or attack on Tesla generates more "engagement" than a sale of Tesla.

Besides which, dumping is an analogy. Nothing is literally being dumped, just like nothing ever gets literally pumped. Nor does anyone ever literally "take a bath" or "get taken to the cleaners." Nothing "crashes" and nothing "booms." And unless people start fucking cows or grabbing salmon out of rivers with their hands and biting their heads off, nobody is "bearish" or "bullish" either.

Dumping is slang financial word for selling your entire inventory of certain type of thing. Usually this has underpinning that the item is some kind of hot potato that they want to get rid of. That is because, usually, selling a huge amount of stock like that causes the price to drop while you are selling it so it means you are accepting some additional losses for selling everything quickly.

When Amazon sells me something they are not dumping it, because I buy just one item and it is not important for their financial situation.

Thanks, I did actually find that explanation useful

“Dumping” is kind of a provocative term, but when you cash out an investment that usually means you no longer expect the asset to continue appreciating. (Or at least that you expect a better return elsewhere)

Nobody would cash out a position if you expected further gains.

Many reasons to dump assets expecting further asset price appreciation: cost to maintain inventory no longer worthwhile, pivot, asset manager quits with no replacement, further gains expected but beta too high, conflict of interest, regulatory burden, etc...

Why would you completely exit a winning trade that you have more insight into than most people since you’re the sole supplier of the primary component in the thing if you thought it was going to have a higher ROI than other investments?

… you wouldn’t.

They see the writing on the wall. Big Auto is going to dominate electric vehicles. Take the Ford F-150 as one example.

https://www.ford.com/trucks/f150/f150-lightning/2022/

I don't think big cars are representative outside the US.

Eg. In Europe, you would have a lot of problems with parking it.

It's not about the size of the car.

GP's "Big Auto" isn't about large vehicles, but about the larger and more established auto industry (Ford, VW, etc.). The F-150 just happens to be a particularly notable and recent example of an electric vehicle that seems to be particularly competently done (versus earlier efforts) out of one of those Big Auto companies. A sign that they may have finally learned how to target that side of the market.

Unless you think investing in yourself is better than investing in other companies.

Yes, they may feel they need to fund more research to stay ahead of the competition and keep the contracts they are currently getting rather than lose them. Maybe the future profits from staying ahead of the pack (or close) are worth more than the expected future growth of their Tesla stock over the current value.

you should exit any trade, winning or loser, the instant you have a better plan for deploying the capital.

Or they take the $3b and plow it back into R&D and factories so they can serve as suppliers to the other Big Auto companies who are dying for battery suppliers.

Or the most likely case, they're tired of Elon's schtick and they can take their technology elsewhere.

I think this is the right move for shareholders if their stake becomes big enough and doesn't serve a strategic value.

If I own Panasonic stock - but 10% of the value is wrapped up in Tesla's value - what's the point? Its better for everyone if they sell and if I want I can then invest some of my own in Tesla. Unless we see Panasonic as Warren Buffet what's the point?

First rule of watching the stock markets: Sales mean little. Watch who buys things, because that indicates actual interest.

Sales might be liquidity questions, rebalancing, any number of issues.

So, what's Panasonic doing that indicates their interest? Turns out, they have a Toyota partnership. Panasonic is trying to get into the European market. Panasonic formed a partnership in Norway to build batteries.

So, most likely that sale is a signal that a) Panasonic is ready to get deeply into the battery business, and b) a signal to their other customers that they don't have conflicting interests.

(I mean, yes, Tesla is also a bad deal, but the market still disagrees)

At "Battery Day", Tesla alluded to their plans to make their organization more vertically integrated: Lithium mining, battery production, and new vehicle designs that incorporate their own cells directly into the vehicle structure [1].

It has been reported in the press that Tesla will (likely) move away from Panasonic as a vendor [2]. Panasonic probably sees this as a good reason to divest and focus on future customers. From [2]:

> Tesla will continue buying batteries from longtime Japanese supplier Panasonic until at least 2022 despite the U.S. electric vehicle maker's plans to produce its own cheaper alternative.

[1] https://www.youtube.com/watch?v=l6T9xIeZTds

[2] https://asia.nikkei.com/Business/Technology/Tesla-strikes-ne...

You would if you cared about diversification at all. That is, if Tesla has problems, the stock you hold goes down, and your sales go down. Even if you think Tesla's going to do well, if you're not certain, you're wise to spread the risk.

It's the same logic as saying that an individual shouldn't invest all their money in the stock of their employer. If the employer as trouble, the individual can be laid off at the same time that the stock crashes.

Because regardless of how much that stock is worth, you can't pay your bills with it until you sell it.

also, panasonic may have an opportunity to put that capital else where which is better for the long term health of the company.

This isn't a retail investor situation

Yep the title is clickbaity, 'exiting their position' would be more apt as the reason isn't known to be a negative outlook.

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