Ford Vs. Tesla

Hey Trader,

Move over Ferrari … there’s a new Ford rival in town!

With Ford Motor Co (Ticker: F) making waves in the electric vehicle (EV) realm, the pickup truck maker is now commonly being compared to the original EV bigwig, Tesla (Ticker: TSLA).

But how has F really compared to TSLA over the last year …

And are the pits reacting?

Let’s take a look.

Revving Up

F opened the 2021 trading year at just $8.51. By contrast, it’s closing price on December 31, 2021 was $20.77.

That’s a 144% gain in a single year … or, if you take Tuesday’s closing price instead, F is up 185% since January 1, 2021.

Since its new CEO took the helm in October of 2020, F’s new focus on electric vehicles seems to be paying off in spades …

And it could be coming for Elon Musk’s brainchild TSLA!

Now, TSLA didn’t see the same kinds of triple-digit returns as F during the 2021 trading year …

But given that it’s starting share price was $699.99 on the first trading day of 2021, a 51% increase is certainly nothing to sniff at!

And both companies are set to hit the ground running this year, with TSLA announcing its 2021 vehicle delivery was up 87% year-over-year, and it is anticipating a further 60% year-over-year increase in 2022, with just over 1.5 million vehicles forecasted to be delivered.

Though F’s current market cap of $87 billion is somewhat dwarfed by TSLA’s $1.2 trillion, F certainly wasn’t going to let TSLA hog the early-year EV limelight. 

F announced on Tuesday that it has plans to nearly double its production capacity for the upcoming F-150 Lightning pickup truck. The company hopes to produce 150,000 vehicles per year by mid-2023.

With the two EV companies set to duke it out for market share, how are traders in the pits positioning themselves?

Looking into TSLA’s pits, the scene is perhaps a bit quieter than you might expect …

TSLA’s open interest is actually slightly lower than normal, at just 94% of its usual amounts. Puts in particular are especially low, at only 91% of their normal open interest.

However, puts still outnumber calls 1-to-1.1 … but that could be partially attributed to the fact that the top two open interest contracts are the June 1-strike (yes, 1-strike) puts, with 147,804 contracts open, followed by the January 1-strike put, with 83,526 contracts open. 

It isn’t until we look at TSLA’s fifth most popular contracts that we see anything remotely near-the-money, with the January 1000-strike call currently having 25,940 contracts outstanding, and a few notches down in popularity is the January 1,100-strike call, with 22,998 contracts open.

Meanwhile, F’s pits are actually busier than usual, with 105% of their normal open interest. And unlike TSLA, F puts are trading at a quicker clip than usual, at 108% of their normal open interest amounts.

However, call open interest outpaces puts 1.4-to-1, and the January 20-strike call currently holds the highest open interest, at 185,441 contracts open.

If we dig into the trading day on Tuesday, F’s daily volume was at 478% of its usual amount, with calls being hammered hard, with 3.3 calls traded for each single put. This is slightly more bullish than usual, with F’s typical volume seeing 2.4 calls traded for each put.

TSLA’s pits were also busier than usual, at 110% of their normal daily volume. Calls were popping, at 117% of their typical daily volume, and outnumbering puts 1.4-to-1.

But then again, Tuesday really was F’s moment in the spotlight, and the two EV heavyweights will continue to duke it out on the streets, and on Wall Street, for quite a while to come.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.