Investing Thread - better known as Wall Street Gambling

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mikeylikey
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Re: Investing Thread - better known as Wall Street Gambling

#61

Post by mikeylikey » Tue Nov 29, 2022 6:58 am

Hardartery wrote: Mon Nov 28, 2022 10:14 am Looking over the market this morning it appears that Eli Lilly is back up to where it was. So, emotional market panic is now moderated over the space of a week or two and that was apparently a good opportunity to take advantage of over-reaction. Cause the market doesn't make short term mistakes or panic, and the smart money large firms would never do anything stupid with money like invest in FTX because they have all of that information that we don't have. Sure.
At $361 the stock is roughly halfway between its high before The Tweet and its low after. The total swing was less than 5%. The average weekly volatility of that stock is +/- 4%. This whole 'emotional overreaction' is well within the noise floor.

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Re: Investing Thread - better known as Wall Street Gambling

#62

Post by SnakePlissken » Tue Nov 29, 2022 7:14 am

Hardartery wrote: Mon Nov 28, 2022 10:14 am smart money large firms would never do anything stupid with money like invest in FTX because they have all of that information that we don't have.
These big firms and big heads didn't buy FTX in huge quantities. They're working under risk/reward models and people like Mark Cuban and Kevin O'leary made it sound like they lost their shirts nearly when in reality I'm willing to bet they only had a fraction of a percent of their wealth in crypto exchanges. It's a smart model if 95% of those businesses go bust, but that 1/20 that succeeds makes a 5,000% return.

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Re: Investing Thread - better known as Wall Street Gambling

#63

Post by Hardartery » Tue Nov 29, 2022 8:59 am

SnakePlissken wrote: Tue Nov 29, 2022 7:14 am
Hardartery wrote: Mon Nov 28, 2022 10:14 am smart money large firms would never do anything stupid with money like invest in FTX because they have all of that information that we don't have.
These big firms and big heads didn't buy FTX in huge quantities. They're working under risk/reward models and people like Mark Cuban and Kevin O'leary made it sound like they lost their shirts nearly when in reality I'm willing to bet they only had a fraction of a percent of their wealth in crypto exchanges. It's a smart model if 95% of those businesses go bust, but that 1/20 that succeeds makes a 5,000% return.
I listened to a couple of reports on it, it seems a couple of them invested a fair amount. One in particular was in around $300 million. That may not be a high percent of the total holdings for them, but it's a huge investment for a "Company" with a staff of about 5 and no actual financials to review.

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Re: Investing Thread - better known as Wall Street Gambling

#64

Post by Hardartery » Tue Nov 29, 2022 9:30 am

mikeylikey wrote: Tue Nov 29, 2022 6:58 am
Hardartery wrote: Mon Nov 28, 2022 10:14 am Looking over the market this morning it appears that Eli Lilly is back up to where it was. So, emotional market panic is now moderated over the space of a week or two and that was apparently a good opportunity to take advantage of over-reaction. Cause the market doesn't make short term mistakes or panic, and the smart money large firms would never do anything stupid with money like invest in FTX because they have all of that information that we don't have. Sure.
At $361 the stock is roughly halfway between its high before The Tweet and its low after. The total swing was less than 5%. The average weekly volatility of that stock is +/- 4%. This whole 'emotional overreaction' is well within the noise floor.
The high for the past month would be $370, the low would be $340.12. That is a swing of just over 12%, neither the $368 a share it was at yesterday nor the $362 and change it is at right now are "Right in the middle. In fact, yesterday it came with $2 a share of it's high and today it is trading at normal volatility for a down day in the market. Getting in above the lowest point on Tweet day could still have netted someone $20 a share profit in the space of two weeks. You like to spout intro to business aphorisms and pretend to be sage, if you don't actually know anything or pay attention to the market then your input is less than valuable.

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Re: Investing Thread - better known as Wall Street Gambling

#65

Post by mikeylikey » Tue Nov 29, 2022 11:26 am

Hardartery wrote: Tue Nov 29, 2022 9:30 am

The high for the past month would be $370, the low would be $340.12.
It closed at $352 the day of The Tweet, and I neither know nor really care what the intra-day highs and lows have been. Incidentally it then dropped again to 349 a few days later, well after everyone in the world knew The Tweet was Fake News. It then took an additional ~ 3 weeks to meander back to where it is now, still 2% off the pre-tweet price. Why 3 weeks? The story was over arguably before the end of Friday the 11th.

But regardless, I repeat my claim that this kind of movement is within the noise for that stock.

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It is not clear to me how your thesis would distinguish between irrational selling because of The Tweet vs. irrational buying by people who read about The Tweet and assumed the stock MUST therefore be a bargain at any number below 370.

That is a swing of just over 12%
Stipulating to your intraday prices, 340/370 = .919% or an 8.1% swing.

I done learnded how do do that in Into to Business (TM).
Getting in above the lowest point on Tweet day could still have netted someone $20 a share profit in the space of two weeks.
As demonstrated above, I can math.

It doesn't mean anything to point his out after the fact. It's only worth anything if you can, as events are unfolding, with some kind of articulable thesis, know that 340 is the bottom. Because if you bought at 355, big whoop, and if you were waiting for $339, you got nothing. If you want to monetize your thesis, you have to be able to articulate and repeat it not just observe in hindsight.

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