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Default Hedge Funds Clipped...

On Thu, 28 Jan 2021 08:53:15 -0500, Keyser Söze
wrote:

Individual investors have ganged up on some short-selling hedge funds,
and the results for the funds aren't pretty. Too funny.


===

That's not necessarily a good thing but I understand the emotional
appeal. Hedge funds are run by very smart guys who take a highly
analytical and unemotional look a company's finances before making
investment decisions. Individual investors in many cases are making
their decisions based on internet discussion forums which are ruled
more by loud talkers than by rigorous analysis. The net result is
that stock prices get inflated over the short term, well beyond their
intrinsic values, a classic speculative bubble. This can be very
exciting for a while and stories spread about overnight millionaires
and the like. It always ends badly however with a lot of relatively
naive people losing almost everything as valuations come back to
earth. It can be a lot of fun while it lasts but you need to keep
your parachute handy and know where the exit doors are.
 
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