by Travis Johnson, Stock Gumshoe | April 23, 2021 7:58 pm
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I think the noteworthy news regarding AAPL is the AirTags. It furthers Apple’s relentless drive to build entire ecosystems within our homes while also moving Apple further into lower priced accessories. Not saying that Apple has invented this decade’s version of the iPod, but I do think there’s more to Apple’s recent announcements than just new colors for the Mac. I read somewhere on the interwebs recently (I personally haven’t fact checked it) that AirPods alone generate more revenue than what half of the companies on the SPX can manage, and we all just rolled our eyes at how stale AAPL had become when they were announced. As a closing aside, I also happened to have just recently purchased my very first Mac (a Macbook Air), so go me, I suppose (I was building Windows PCs when I was literally 12 years old in the mid-90s. Old habits die hard, as they say).
Could be, that’s probably a more rational position. Services and wearables are a bigger growth driver than many expected a few years ago
Travis -Have you split out the warrants on Yellowstone? Is there a reason to or not, or what is a trigger to split out.
They should split automatically when a deal is done. There’s no reason not to split unless your broker charges an egregious fee to do it. There is no advantage to keeping the Units whole, and some advantage to splitting if you want to sell in pieces pre-deal.
Bold statement crypto currencies will be destroyed by federal goverments creating their own digital currencies. No federal government and it is already in action with the Chinese and Indian governments thats one third of the population of the world!! The Americans and the EU will not be far behind. There is a big future in blockchain but no federal goverment will permit secret transactions they cannot follow and tax. One or two specialist ones with blockchain transparancy may continue but they will eventually be eaten up by federal digital currencies. Just an opinion that seems rather obvious in the near and medium term Philip
Hi Travis,
What goes into your decision to buy options instead of the stock? For example, your Uber calls.
Mostly, I use options either as a way to get a little leverage with some built-in risk control (when I combine options with equity), or as low-conviction bets when I think there’s something to a story over the next year or two but don’t want to risk a lot of capital.
In the case of Uber and Absolute recently, it’s best to think of these as a pressure-release valve for my animal spirits — small positions, high risk, willing to lose 100%. I get more of these wrong than right, but the wrong ones lose 100% and the right ones occasionally return 500-1,000% or more, so it works out OK.
comments on fnma
Fannie Mae is a bet on politics, I’ve long been skeptical — though lots of smart people disagree with me.
I think the optics are terrible — if FNMA is reprivatized in the way Bill Ackman and others have long advocated it will provide a huge windfall to those hedge fund traders. Trump and Mnuchin were widely expected to push for that reprivatization, releasing FNMA’s profits to shareholders now that they’ve paid back Treasury for the 2008 bailout, but if even they didn’t push for that it’s hard to see more govt-friendly and socially
Motivated leaders give up the FNMA golden goose. I’d bet that FNMA funds will instead be directed to help with housing inequality issues, but that’s just a guess and the courts could also intervene at some point (though the courts have not favored those FNMA activist investors so far)
What is your thought process on the ABST calls? They are pretty far OTM. Great, thorough write up on the savings bonds.
Essentially, a speculative net that they might find a bid with new investors and a couple strong quarters. I’m not convinced of the fundamentals and don’t particularly want to build a position at this point, but I do think there’s a decent chance that they could take off for a while with more attention.
We’ll see how it goes — I use these small options speculations to satisfy my gambling urge as much as anything else… low conviction, high potential for 100% loss, and never, as a group, getting more than a tiny part of my capital (usually 1-2%, though sometimes that portion of the portfolio balloons when there are some big winners).
If I have both an option and equity position, it’s a way to get some leverage with a sort of built-in stop loss for ideas where I see great potential but the stock is also trading on momentum — that was the case with SE, CHWY and SFIC last year, for example. If I have only an options position, it’s typically a low conviction “bet” where I don’t want to allocate a lot of capital.
Every investor is different, but I think the psychological release valve of a little options speculation helps me avoid doing dumber things with larger amounts of money.
Thank you, and +1 on that last paragraph – well stated. I find myself gravitating towards options plays for the same purpose. I’ll make a couple defined bets here and there to “dabble” and make myself feel like I’m actively doing something. When in reality, I’m just keeping myself distracted from doing something stupid with my core portfolio LOL.
#LeftBrainRightBrain #TheStruggleIsReal
Travis, have you or anyone here, considered any of the crypto indexes. I’m thinking of the Grayscale bitcoin index GBTC, it trades like a stock, with huge volume, goes up and down like bitcoin, yet no one can steal it, like we constantly hear about cryptos, and if you sell it at a loss, it is a capital loss for tax reasons. If anyone would be willing to share an opinion I would be glad to hear it.
3-24-20 I bought approx. $9k of GBTC at $7.74. 1-20-21 I sold my basis in $ when GBTC was +391% in my holdings. Shares left, currently my basis is a bit over $7k and valued at $37.7k (was $50.5k at high 2-19-21). I purchased into 5 portfolios; one each of Roth IRA and Rollover IRA for both my wife and myself, and lastly joint investment portfolio. When purchased in March 2020, i disliked the high premium fee (not a discount!), but weighed that compared to possibly losing my id password for my wallet with Bitcoin. i’m considering Coinbase – i understand their premium is not as high as GBTC.
While reading your post on Coinbase, , you mentioned there was a link to your site, that if used, there would be a chance to join Coinbase or Voyager and receive a (slice) of a COIN free. could you post your link again, I seem to have lost it. Thanks
coinbase.com/join/tjohnson_C3hfpQ?src=ios-link
https://voyager.onelink.me/WNly/referral?af_sub5=AF72CA
Totally agree on I-Bonds. About IPOs. You mention Fortegra’s original S-1 had a placeholder amount of $100 million. I am watching Atai, they also use $100 million in their initial filing. How does this work? I assume the underwriters are gauging interest in the market now. If healthy interest is there, do they file a revised S-1 with a larger amount offered? (i.e. does a revised offering bode well for the IPO?)
The only real reason to include a number there is that they need it for their registration fees… I take it as mildly positive that they are getting more specific, but wouldn’t read much into it. It can still change.
I can’t remember which thread Travis and others talked about GRAB. Am I correct that if I buy AGC today, say 100 shares, I will eventually receive 100 shares of GRAB? I read the news about GRAB’s merger with AGC, but not enough details to figure this out. Or is there a way for us to buy GRAB directly? TIA.
Assuming the deal goes through as planned, AGC will become GRAB when the deal closes. Buying AGC at $13 is essentially like buying a share of GRAB at about a $50-55 billion valuation, depending on the price (per the initial announcements, at the $10 SPAC price it was an implied $39 billion valuation).
Thank you Travis. That makes sense.
Judging on the recent price of AGC, it doesn’t look like the market is very enthusiastic. Could it be about the merger itself or SPACs receiving scrutiny from the government?
Travis, if you were to buy AGC, what do you think a reason entry price is?
SPAC deals in general are being looked at a lot more cautiously than was the case a month or two ago. I haven’t looked at the specifics and don’t have a buy target for GRAB/AGC right now, personally.
Outstanding shares Coinbase 199,1 Mio. at the moment. 260 mio. is fully diluted imho
Oops, you’re correct. Sorry. Yes, the extra 60 million are not technically outstanding shares yet, they’re employee options and restricted stock. Must have mixed those up with the 68 million B shares (which are included in the 199 million)
Glad to help. You do a great job. Thanks for so much inspiration!
Nice to see Series I Savings Bonds get a little attention — I always wonder why more people don’t recommend them as an alternative to CDs or other savings options. Covered by Zweig in the WSJ today: https://www.wsj.com/articles/i-bonds-the-safe-high-return-trade-hiding-in-plain-sight-11622213324?st=srgrtkpnsv7bk7v&reflink=article_copyURL_share