I Asked ChatGPT To Explain What’s Going On With Tesla Stock Like I’m 12 — Here’s What It Said

Stock trading can be confusing even to someone with a bit of knowledge, and mine is moderate. One thing I’ve noticed, however, is that Tesla stock has been bouncing around like kids on a trampoline.

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With headlines crowing that stock is either soaring or tanking, I thought I’d ask ChatGPT to step in and explain what’s going on with Tesla stock — like I’m 12. (Frankly some 12-year-olds probably have a better idea, thanks to TikTok).

Here’s what the generative AI told me after it ran an internet search.

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Imagine Tesla as a Roller Coaster Ride

ChatGPT urged me to think of Tesla’s stock as a roller coaster with its “ups and downs.” When Tesla’s stock was low at the beginning of the year, “the ride was a bit rough,” it wrote. Tesla’s stock price went down faster than Space Mountain at Disneyland, without the fun, because fewer people were buying its cars, and some new models didn’t sell as well as expected. The Cybertruck’s recalls, lack of popularity and rough internet memes probably didn’t help, either, ChatGPT mused.

Also, other car companies, especially from China, “were making cool electric cars that people liked,” which did nothing to improve Tesla’s stock because it meant steep competition.

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But Then, Some Good News Came Along

Tesla’s stock started climbing with the enthusiasm of the first half of the Guardians of the Galaxy roller coaster at Epcot. Why? ChatGPT said investors got excited about Tesla’s plans to launch self-driving robotaxis in Austin, Texas. People thought “it could be a big deal for the future of transportation,” it wrote.

It didn’t hurt that the U.S. and China “eased some trade tensions,” good news for companies like Tesla that make a lot of their car parts in both countries.

So, What Can Investors Expect Next?

Even though Tesla stock has had more ups and downs than the Incredicoaster at Disney’s California Adventure, ChatGPT said, “they’re now focusing on new and exciting projects.” This has made investors feel more confident, and the stock price has climbed again as a result.

What Does It Mean for You?

I wasn’t satisfied with this information, so I asked ChatGPT what these ups and downs mean for the average investor.

It told me, “Let’s say you (or your parents) own one share of Tesla stock. That means you own a tiny piece of the company. When Tesla does well and people want to buy more of those pieces, the value of your piece goes up — cool, right?”

Right, I said to myself.

But When Things Get Bumpy…

When Tesla struggles, as it has been doing, “people get nervous and might sell their shares,” ChatGPT warned. When people do that, it drops the value of your share, too.

“So, if you check your account and see it’s worth less than before, that’s why. It’s kind of like a toy that goes out of style — fewer people want it, so it’s not worth as much.”

What Tesla Stockholders Should Do

If you own Tesla stock and are wondering what to do, ChatGPT summed it up in a series of easy-to-understand bullet points:

• Don’t panic if the price drops. It reassured me that “stocks go up and down all the time.” Nothing to worry about.

• Think long term. It suggested that if you have any faith in Tesla, it’s a good idea “to hold onto your share and wait.”

• Spread out your money. However, it warned, “Smart investors don’t put all their eggs in one basket.” So if you’re only invested in Tesla, spread the stock love around.

If you’re an average investor, Tesla’s ups and downs are part of the ride and nothing to worry about, ChatGPT said. “If you believe in what the company’s building, you might stay on the roller coaster — even when it gets a little wild.”

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This article originally appeared on GOBankingRates.com: I Asked ChatGPT To Explain What’s Going On With Tesla Stock Like I’m 12 — Here’s What It Said