06 Feb

Not an investment advice

Image Source: Internet

I’m investing my extra money (cause inflation, you know) and I’m not an expert for sure, but just to spice up my blog that no one reads…
Anyway, not an investment advice 🙂 , but I have my (maybe totally wrong) theory about all this GME, Reddit, short squeeze, etc. craziness.

Back in 2017, when I knew even less about investing than now, I’ve followed an advice of some not so good “expert” on SeekingAlpha (his name was Brad, in case you are looking for an advice on SA) and bought shares of Tanger Factory Outlet (SKT) at ~$25/share.
Since then I became a “happy” bagholder as price of SKT kept slowing going down and down and down.
Here is a nice chart showing my pain:

Chart Source: Yahoo! Finance

Don’t get me wrong, I still like the business. Even though brick and mortar is in a decline, I think Tanger will definitely survive, in a much smaller size though.
And company was paying good and growing dividends until 2020.
Fast forward, COVID, blah-blah, no dividends, the stock price at the bottom down to $4.05, only ~16% of my initial investment.
What a sucker am I, right? 😀
Next came January 14, 2021 and Tanger reinstated dividends, much lower than before, but nonetheless.
Reddit “squeeze the shorts” mania began around the same time, and SKT happened to be in top 10 most shorted stocks.

I was able to average down quickly to $16.21 and sell everything for little profit at $17.57 before stock collapsed to current price of ~$13-$14.
Short squeeze didn’t happen (or did it?), short interest actually grew from ~49% to current ~52% and I couldn’t nail the top of $20.96, but I was able to make ~39% gross profit (including dividends, of course) on my poor initial investment in around 3 years.

Back to my theory, which can be totally wrong, or most likely partially true.
The were lots of big players, but sad bagholders of these poorly performed stocks (compare them to Tesla, right?) like GME, AMC, KOSS and others.
They wanted to get rid of these stocks badly and they’ve found the way.
Whether they have just poured more gas on “short squeeze” fire or started it themselves, I can’t tell.
What matters is that lots of holders were able get rid of these stocks with some gains, including myself.
Those who were able to sell GME close to the top (also check KOSS, 52 week range: $0.80 – $127.45 🙄 ) got rid of it with fabulous gains. Тесла нервно курит в сторонке.
Those who bought at the top, well… well… Welcome bagholders!

One thought on “Not an investment advice

  1. Interesting story from sell-side of Gamestonks mania:
    Finally, after the market close on that same Tuesday, the titan of all business social media, Elon Musk, who has a particular disdain for short sellers who he has regularly battled publicly, tweeted a single word – “Gamestonk!” – which sent GME investors into a frenzy. We believed that things couldn’t get any better than that in terms of the immediate term trading mania, and as a result, we sold our remaining GME shares in the post-market trading hours and into Wednesday, January 28th regular trading.
    https://www.senvest.com/documents/FG/senvest/reports/611773_Senvest_Capital_Final_English_Mar_31_2021_May_7_2021_449pm.pdf

Leave a Reply

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