Long IREN vs. the shorts?Today, a firm sent out a notice that they are short IREN so I'm going long. Their track record suggests going long when they say go short is a potentially very profitable short term strategy. They are often correct long-term, but sometimes a short wouldn't survive a margin call and short-term a contrarian long play can often yield 30-500%
Some of their recent calls:
Short call opening price the next day was 28.90. Peaked at over 40 within 2 weeks. Up over 30% in 2 weeks going long.
Short - rallied 7 of the next 8 trading days for a 30% gain.Re-iterated short again about a month after the first call and the close 1 month after the second one was 14% higher.
Short - you'd have made over 400% in 7 months going long against them this time. Even now, the price of the stock is 143% higher than when they made their short call. Good luck on that margin call or even the interest charges on that margin for that matter.
Short - they made this short call on the day of the absolute low close since the call. It closed up over 400% less than 6 months later and is still up over 300% since the call.
Short - stock rallied almost 500% in 4 months after this call... "Hello this is your broker, we're gonna need a LOT more money in your margin account".
There's a bunch more but I think I've made my point. They can be right long term, and still be very, VERY wrong short term. Both things can be true. If you'd have shorted some of these, many people would have been wiped out by the margin calls on some of these before you could ever make money. And you only get to get wiped out once. Shorting is VERY dangerous.
Also don't forget that margin interest runs around 8-10% now. It's "free" to go long provided you aren't using margin to buy (I never would) and very expensive to short these stocks unless you are correct right away. Anyone who knew ahead of time what they were shorting could make a pile on the day the news comes out, for sure. But WE don't know what the stocks are ahead of time. Only they do. But there's money to be made by us regulars when those shorts have to be covered during a squeeze or they take profits.
Props to them for leaving their research up on their website and Twitter and standing by their calls. If you have the margin call cash and the iron stones it takes to watch a shorted stock rise 500% before it falls, you can make money with some of their calls and you're a LOT braver (and richer) than I am. Shorting carries unlimited downside risk and a max gain of 100% (minus margin interest) - remember that.
Don't get me wrong, I respect short side research and there's a lot of validity to some of it. They are spectacularly correct sometimes and can do great things to protect buy and holders of individual stocks. But I'm not a long term owner of the company, just a trader of the stock. And after doing some research, the fact is, there's a lot of money to be made short-term by trading against them. This is the beauty of free markets - differing opinions create exploitable situations. I'm really glad I stumbled on that news flash.
And for the record, no I'm not naming the firm or the tickers they made calls on, as I don't wanna run afoul of the Tradingview's rules on using others' proprietary info, etc. I like this place too much and don't wanna get run off. You can look it all up for yourself easily enough with Google and the info I've shared here.
And btw - I'm not suggesting investing in IREN or any other stock, this is just my thoughts on the matter and what I'm going to do with the information. Please make your own WISE investment decisions.
