Thursday
October 22, 2015
1-855-RWT-0008
Prepared by the good people at Random Walk, LLC. (and Scott)
Great Morning!
Closing Prices From Yesterday
Yesterday and Today
Yesterday and Today
YESTERDAY
It was a quiet, though strange day. The market opened higher with the SPX opening up +10 points. From thee the market sank to slightly below the unchanged line. The market then began to climb up higher again when Joe āTouerettesā Biden announced he was not going to run for President, but was going to continue to run his mouth.
Though I listened to his speech, I really could not figure out what he was trying to say, and nether could the markets as they sat up +7 points in the SPX.
Once done Trump started to tweet that he was glad Biden was dropping out because Hillary is easier to defeat. Not to be āout -Trumpedā by Trump, Hillary began tweeting that she was inspired by Biden’s speech. I think she was inspired by the fact that her only competition on the Democratic side is a socialist nut job. Again, the market didn’t seem to care.
Then all of a sudden VRX fell 40%. The stock fell from 148.66 to 88.50 before being halted. Rumor was that this was a Ponzi Scheme. In fact it was one āactivistā group shorting the stock and spreading rumors to get a quick profit. At least that is what it seems like given the information on hand at the moment. After the stock reopened it went from $102 back to $125 before closing at $118.61.
But this movement was enough to spook the markets from+7 to close down -12, taking the Dow from a high of 17,314.99 to 17,168.61 (net ā 48.50). This was all BS.
TODAY
Unless something happens tonight to yet another company, I suspect the market will be up by the same the same amount or more than it was down.
Let’s see. Consumer Reports announces at the end of August that the TSLA is so great of a car that it can’t even rate it (Stock up >$18). Now less than 3 months later Consumer Reports announces that it is such a bad car with so many problems that it wont rate the car (stock down -$26).
Then Bill Ackman is long 5% of VRX shares and watches as a competitor takes down his stock in the same way he took down several names like Lumber Liquidators and Herbalife. Oh the irony. But Bill has balls, and went in and bought 2 million shares while the stock was falling.
Math:
It is reported that Ackman has 5% of the 342.79 M shares outstanding. That comes to 17,139,500 shares. With a fall from 148 to 88 we have a loss of $60 a share. Now, $60 a share times 17,139,500 comes to be 1.03Bln lost in 30 minutes. From there he has the balls to go in and buy another 2 million shares? My Man!
So it is becoming evident that there is more money to be made spreading rumors and creating lies in the market than there is investing. My guess is we will see more of this until someone goes to jail.
But we still should go higher until another rumor. The late day sell off was nothing but BS, and BS gets flushed. Iam just glad I didn’t have a position in this name where I stepped in the BS like I did the TSLA BS earlier.
An exhaustive class BUT highly informative. We took a long vertical spread and looked at 13 different ways to spread the risk off. The next part of this will come in more advanced form, and then taking complex trades and doing the same thing
POT is held each Wednesday night at 7:00pm eastern.
Contract the office at 1- 855 ā RWT ā 0008 for more details.
Too True To Be Funny
Attorney Stuff
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