shorting stocks based on fragility
On principle, therefore, a small short position is in order. Small because we cannot time markets, and small because it's an expression of a philosophical view, not an attempt to make fuck you money with one trade.
April 1, 2025 update: the party may have also started for MSTR, with GME announcing their plans to become a bitcoin treasury company.
the chinese jar
akin to a Chinese jar resting peaceably on a high shelf in a quiet house, the market values of Tesla and MicroStrategy have drifted upwards for a while. Undisturbed by fear and stoked by hysteria.
'Professional' analysts try to understand the two companies' business models, they try to predict share price trajectory, effect of macroeconomic factors, geopolitical vectors, etc.
Utterly and completely a 'nerd' approach.
We don't want to be nerds in life. We want to be practitioners.
back to the chinese jar
The hypothesis is simple: the two stocks are extremely fragile. They are exposed to and are very sensitive to stressors.
I know that the Chinese jar is fine now when the house is quiet, but I am certain that it will be shattered if given enough time, and start having parties and inviting friends (or, even better, friends and their kids).
And the party started on inauguration day.
Tesla has massive Elon-related fragility. Massive. This on top of natural and common business risks.
And MicroStrategy, oh boy, a leverage play that keeps adding more and more leverage to buy one and only one highly volatile 'asset'. What could go wrong?
go short based on fragility, not on prediction
On principle, therefore, a small short position is in order. Small because we cannot time markets, and small because it's an expression of a philosophical view, not an attempt to make fuck you money with one trade.
