Wall Street Bets: The EBR Edition

What does "trust size" mean?

How is "Net Asset Value" assigned/determined?

Do you hold any of these company stocks after the pop, or do you get out right away?
 
ChezCheese:) said:
What does "trust size" mean?

How is "Net Asset Value" assigned/determined?

Do you hold any of these company stocks after the pop, or do you get out right away?
Click to expand...

Trust size is effectively the amount of money raised in the IPO for the SPAC that is held in the escrow account used to merge with a future company.

The Net Asset Value is clearly found in the S-1 SEC filing for every SPAC. For just about every SPAC except for Pershing Square Tontine Holdings, the NAV is 10 USD.

After the initial pop when a target company is announced, either through a rumour (typically on Bloomberg), a formal letter-of-interest (LOI), or a definitive agreement (DA), that is when you need to do your homework and decide if the target company is one you want to keep in the long run. There is typically a drop in stock price after the initial pop, and then if the target company is perceived as desirable, a steady climb back up leading to the merger. After the merge, most SPACs tend to drop in price again. It is not recommended by most SPAC investors to hold through the merge, unless you are convinced with a company's prospects.
 
Sounds like 'hot potato" or "pop goes the weasel" from my youth ...
 
Ravi Kempaiah said:
My friend invested $10K into QuamtumScape and just in the past 10 days, he has made an additional $50K!

EV related SPACs and stocks are doing AMAZING this year!
Did anyone invest in NIO or Xpeng?
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Did your friend sell his QS, or is he still hanging onto them?
 
Here's a question for you investors: Do you think a "correction"/crash is coming soon? I read dire predictions, about how the market graph is mimicking 2009 or 2010, and it looks convincing that there will be a downturn soon. Yet with interest rates so low, we are all must continue in the stock market because there is no [reasonable] alternative.

One thing I notice about that graph from 2009-2010 is that the market turned back upward after just a couple of months, and so if you simply held on, your portfolio would recover.

What do you think?
 
ChezCheese:) said:
What do you think?
Click to expand...

There isn't a super happy history of small players (and by "small" I mean anybody who is moving less than billions of dollars around) timing the market. So it is best to just let it ride and hang on.
 
I used to "front run" earnings reports back in the day with a modicum of success but most of it was dumb luck guessing right-based on nothing more that a few rumors and a hunch. I also remember the sinking feeling when I guessed wrong and stock went the other way. Now my biggest gamble is deciding whether or not I need to take 2 water bottles with me on a long ride...
 
When I see new record highs set, I buy a little SDOW - can't help myself. Not a lot, just a few shares, so I don't feel so bad when the peak turns into a slide and the bottom falls out from some other holdings.....

VXX below about 16.50 can be fun too....
 
ChezCheese:) said:
Here's a question for you investors: Do you think a "correction"/crash is coming soon? I read dire predictions, about how the market graph is mimicking 2009 or 2010, and it looks convincing that there will be a downturn soon. Yet with interest rates so low, we are all must continue in the stock market because there is no [reasonable] alternative.

One thing I notice about that graph from 2009-2010 is that the market turned back upward after just a couple of months, and so if you simply held on, your portfolio would recover.

What do you think?
Click to expand...

You will never know when the correction will come. I personally believe we are long overdue for a 10-20% correction, but unless the narrative about vaccines turns towards one of failure, we will not dip below a 20% fall in the market.

Best thing to do if you are concerned is to hedge yourself by selling put options on leveraged S&P funds.

Additional reading:

www.investopedia.com

4 Strategies to Short the S&P 500 Index

Learn the advantages and disadvantages of methods available to investors with the objective of making a bearish bet on the S&P 500 Index.
www.investopedia.com www.investopedia.com
 
ChezCheese:) said:
Here's a question for you investors: Do you think a "correction"/crash is coming soon? I read dire predictions, about how the market graph is mimicking 2009 or 2010, and it looks convincing that there will be a downturn soon. Yet with interest rates so low, we are all must continue in the stock market because there is no [reasonable] alternative.
Click to expand...
A 10% correction is always around the next corner. It's time in the market that matters. In 1986, you could have put $500 into Proctor & Gamble, and another $500 into Kimberly Clark,. Then add another $10 a month for both, about what you might spend for soap and toilet paper. It would be worth $130K today (the $10 not adjusted for inflation). Actually, if you only bought PG with your thousand bucks, you would have $160K. (Source: Portfolio Backtest)









.
 
Put options and hedge funds and gambling on the fall of markets are much too negative, complicated and devious for me.

What do you all think about GM?
 
Yes, but you can't know. Nobody could have known how this whole pandemic thing was going to pan out, and we still don't. Also, the major auto makers seem to be getting on-board with the electric vehicle movement, and that is only a recent switch.
 
For the market disruptors obviously there's no correction coming and we've had and still have this once in a generation possbilities to make an awful lot of money by investing in the following industries: Biomedical , AI , EV, Drone tech. , Space sector , the right SPAC's . Don't neglect the cannabis industry revolutionary prospects also !!! The full legalization is months away.

Gains of 1000-3000%+ for the passionate investor were and still are perfectly doable in those industries .

Other then those you have the precious/semiprecious metals, commodities and some digital cryptographic algorithms(note that i don't call them "coins" b/c there are no coins involved ....just different algorithms for different digital cryptographic programs: ETH/LITECOIN, etc..) that will increase in value (10-100%+) but not on the order of magnitude as the disruptor stocks.


And let's keep in mind that the $ is under ongoing fast devaluation , one should get euro or renminbi. That's another reason why some stock values seem to look very high but they are not.

This is not financial advice.
 
In a note titled "Expanding the EV Universe," Morgan Stanley analyst Adam Jonas set a $70 price target for QuantumScape, saying that it was among companies in the electric vehicle battery space offering "the most compelling strategies" and positive risk/reward skews.


Jonas added that the company has been developing "game changing" solid state cell technology and has achieved "promising results" with its patent ceramic separator.
 
bikeman242 said:
Trust size is effectively the amount of money raised in the IPO for the SPAC that is held in the escrow account used to merge with a future company.

The Net Asset Value is clearly found in the S-1 SEC filing for every SPAC. For just about every SPAC except for Pershing Square Tontine Holdings, the NAV is 10 USD.

After the initial pop when a target company is announced, either through a rumour (typically on Bloomberg), a formal letter-of-interest (LOI), or a definitive agreement (DA), that is when you need to do your homework and decide if the target company is one you want to keep in the long run. There is typically a drop in stock price after the initial pop, and then if the target company is perceived as desirable, a steady climb back up leading to the merger. After the merge, most SPACs tend to drop in price again. It is not recommended by most SPAC investors to hold through the merge, unless you are convinced with a company's prospects.
Click to expand...
Well, I thought I would try a couple, but only because I like the prospects of the industries the SPACs are merging with/going for. One is CLII, which is bringing EVGO to the market. Electric car charging infrastructure. Then there's PDAC, which is bringing to the market a Canadian lithium battery recycling business called Li-cycle.

I didn't buy the pig in the poke, because I bought after they announced what companies they are actually bringing to market. Which means I am not using your strategy to make a profit, but rather plan to hold on because I believe in the long-term success of EV charging infrastructure and battery recycling. Let's see how it all unfolds...
 
ChezCheese:) said:
Well, I thought I would try a couple, but only because I like the prospects of the industries the SPACs are merging with/going for. One is CLII, which is bringing EVGO to the market. Electric car charging infrastructure. Then there's PDAC, which is bringing to the market a Canadian lithium battery recycling business called Li-cycle.

I didn't buy the pig in the poke, because I bought after they announced what companies they are actually bringing to market. Which means I am not using your strategy to make a profit, but rather plan to hold on because I believe in the long-term success of EV charging infrastructure and battery recycling. Let's see how it all unfolds...
Click to expand...

Be careful buying any spac when it is trading away from the NAV floor of $10. SPACs get crushed whenever there is a general market downturn. If you are going to buy a Spac over $11, I suggest waiting for the next dip. Look at how spacs performed during the week of the Gamestop debacle, they crashed much harder then the general market. Its good to keep cash on the side for the next red week, and not chase once they start to move away from NAV.

The whole appeal of SPACs is the asymmetrical risk/reward profile, which does not exist if you start buying spacs over $12.
 
But if you don't know what company the Spac is working with, then you are buying a pig in a poke. That's a real flip of the coin. Do all NAVs start at $10? And then they go up when they announce what the company is, yes? So to buy at $10, you're really taking a chance. But we are doing things differently. I'm looking to invest in companies/industries I believe in for the long term, not just working on this qtr's income.
 
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