A scalable growth tech opportunity?

Trade ideas and a potential multibagger

The transition is complete!

I wrote last month about moving to Beehiiv, as it’s a far better platform than what I was using before (a makeshift use of various tools packaged together).

What changes for you? The user experience is better, and logging in is easier, and you’ll be notified via email every time I upload a post.

I’ll let you know when the next edition is at the end of every post as always, but now you’ll be notified when a new post is live.

Please make sure you add [email protected] to your contacts. This is where the site notifications will come from.

“How is the stock market doing?”

This is always a different question to answer. Because it depends on what part of the stock market you’re looking at.

During the end of 2021 we had lots of small caps selling off and making new lows, but the market leaders weren’t following.

When the soldiers are flagrantly disobeying it means something. Remember, the most speculative of assets fall first. Then the next ones. Then the next. And then the next. And eventually, the Generals fell.

So if you were mainly in large caps, the stock market was doing well. For you.

And if you were heavily in small caps, well, the market certainly wasn’t. For you.

But my view remains that we’re well into bear territory and even though we’ve got bank collapses, stocks have been whacked so much that the risk/reward for going short (unless you find a special situation short) is unattractive.

The problem with going short is that your upside is capped. It can only ever be 100%, and holding for 100% is often not efficient on your capital hence why so many shorters close before the stock delists (and this can be why we get dead cat bounces and spikes).

And the downside is high because there’s no limit to how high a stock can go, and the market is inherently long. People want to be long. They want to be optimistic. And you can’t blame them because, historically, betting on stocks going up has not been a bad move in the long run.

So we’re at the stage now where shorting pressure has dissipated. And valuations have been smacked. It’s a Mexican stand-off between the bulls and the bears.

Same actor. Wrong movie.

I wrote back in January that the next big card to be played was the ending of the Russo-Ukrainian war. I still believe that to be the case.

But there is plenty of activity in stocks and there are trending stocks out there.

So how is the market doing? Well, it depends what stocks you’re in.

Potential multibagger

Last month I mentioned I thought I might’ve found a multibagger.

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