Markets Reverie

  Once again it seems like the internet has united to shoot up the price of a stock. This time around, it’s AMC. As of June 2 nd , the stock has soared past the $70 mark. The only question on everyone’s mind is how high will it go, before it starts collapsing? If you have no idea what’s happening right now, AMC is currently undergoing a ‘short squeeze’. A short squeeze is a very rare financial phenomenon that occurs when there is upward pressure on a stock causing its price to rise. This results in the underlying stock’s short sellers being forced to buy the stock at a higher price and pay the difference between its current stock price and the price they initially sold it at. Short squeezes usually occur when investors collectively feel like a certain stock is over-shorted. In the case of AMC it was shorted at around 19%, and investors retaliated by buying more and more shares of the stock, thus creating upward momentum that will increase the stock price. Now, short sellers have ...

What is Multiples Valuation? It's time to finally come back to doing some more technical analysis. Since it's been a while, I decided to started of with a simple Multiples valuation to get the ball rolling.Multiples Valuation or the multiples approach to valuation is a method of valuating companies based on the belief that similar assets sell at similar prices. In the case of companies, financial ratios that are calculated by dividing the market value of estimated value of a stock by a specific item in the companies' financial reports. Common ratios used in this approach are: Equity value & Enterprise value ratios. Enterprise value multiples include the Enterprise value to sales ratio, EV/EBIT, and EV/EBITDA. Equity multiples are ratios that examine a company's share price with values that underline the company's performance like earnings,or sales. Common ratios include P/E (price-to-earnings ratio), and P/S (price-to-sale ratio). I learned of these ratios and t...

Robinhood has been in hot water for what has felt like all of 2021. Whether it be their controversial decision to freeze GameStop trades and only allow shares to be sold, restricting even more stocks such as NAKD, AMC, and NOK while competitors like TD Ameritrade or Fidelity did not restrict as many , and the Dogecoin boom breaking their app. Such an exhaustive list is obviously going to leave to a leave bad taste in a lot of users' mouths. As someone who sat on the sidelines and witnessed the resentment of Robinhood spew, I wanted to explain the situation to those who would be confused. Understandably, Robinhood users became frustrated as GameStop was soaring by upwards of 14,300% higher over the past few months, even reaching upwards of $483 per share. A lot of this frustration brew inside the finance-meme subreddit r/WallStreeBets, where a majority of its now 10 million subscriber base use Robinhood. The subreddit’s Twitter account stated, “Individual investors are being strippe...

In late March, a completely out of left field event occurred, Archegos, a large family-run hedge fund collapsed. To be more precise, Archegos began liquidating large positions in blue-chip companies that it had invested in like Viacom CBS, which Archegos owned $20bn worth of shares or an astonishing 30% of the company’s total value. The founder of Archegos, Bill Hwang saw his nearly $20bn fortune go up in smoke, due to this.  What started initially as a fund mainly centered around tech stocks, Bill Hwang started to move towards a more eclectic array of companies like media conglomerates ViacomCBS and Discovery, Inc which became huge parts of Archegos’ portfolio and Chinese stocks like GSX, Techedu, Baidu, Iqiyi, and Vipshop.   It is required by US law to prevent individual investors from buying securities with more than 50% of the money borrowed on margin. No such rule applies for hedge funds and family offices. As a result of this, Hwang was allowed to exercise as much r...

  I first heard about NFTs when watching a YouTube video by on of my favorite creators JxmyHighroller, where he discussed the company called Top Shot. Much akin to basketball cards of the past, Top Shot sells cards, but instead of individual players, they sell NBA highlights. Essentially, Top Shot sells highlights, either as individual moments or packs. Each highlight comes in a set and some sets come in a circulation count with a counter of how many sets are in motion. Some sets are limited edition with a fixed amount minted. All the highlights in a particular set have a serial number, the serial number represents the sequential order in which something was minted. The earlier something is minted, usually the rarer it is, thus the more expensive it is. It should also be noted that there is a tier system for the sets. The whole concept of Top Shot is still quite disorientating to me. What is the difference between a highlight from Top Shot and just the same highlight that can most ...

Cathie Wood of Ark Investment Management has emerged as one of the most prominent figures in the asset management space. In 2020, her $16.4 billion Ark Innovation ETF has returned 152% in 2020. Three of her other ETFs have more than doubled. However, the superb performances of ETFs like ARKK (Ark Innovation ETF), is not the sole reason for why she has received some much adulation and support as of late. I think breaking down why Cathie Wood has so much support is important because it digs into the deeper issue of the extreme alienation that most retail investors feel with Wall-Street as a whole, especially incidents like GameStop’s short squeeze. Before breaking down why Wood is as loved as she is, it is pertinent to talk not only about her history but the history of Ark. Prior to founding Ark in 2014, Wood worked at Jennison during the 1980s. At Jennison, she proved herself as a capable researcher and strongly distinguished herself with one of her most characteristic traits, her chari...

  Cathie Wood’s Ark Investment Management had purchased 1.5 million in additional stock of Palantir during the mid-February dip. Cathie Wood said at the time, “If you’re short-term in your focus, you probably don’t want to invest too much time in Palantir, and that is music to our ears.”

  Recently, Palantir has been getting a lot of eyes on it. This has been for both good and bad reasons. As a company that mainly handled government clients for more than a decade, they have aided quite a few controversial bodies, such as ICE- U.S. Immigration and Customs Enforcement, the CIA- Central Intelligence Agency, and the NSA- National Security Agency. However, tech giants like Amazon and IBM have recognized Palantir’s abilities and have partnered with them to improve and expand on their AWS and Watson services respectively. Now before talking about Palantir’s recent financial performance, it’s important to talk about it’s past, so that we can better map out its future. Palantir was founded in 2003 by Peter Thiel, Nathan Gettings, Alex Karp, Joe Lonsdale & Stephen Cohen. The company’s main function is to make software that integrates large volumes of data into a central platform so that it can be analyzed. For a majority of its life, Palantir served the United States Int...