Indeed, I think he should have just gotten to the M&A point of the article instead of trying to come up with an 'opposite' theory. Good point on the earnings release timing, I did not know that. That's a hurting industry so anything positive [or less negative] would make for a nice pop.
OT: So now the Yahoo Finance MB gestapos are rejecting posts if I type l o l as one word.
Interesting article but i think b&n is a poor example. They traded at about 5x earnings ex nook which was a constant money loser. The idea that not only would it be jettisoned but might even be worth something was attractive. Also the announcement was made with the earnings release so it wasnt necessarily the only reason for the 12% pop.
good point. It's come back a bit but most likely will drop 10 points or so on S&P. If he loses money today there really, truly is no hope for him.
The Martingale betting system is very famous among gamblers and many variants have been devised. Almost all of them lead to ruin over the long run.
Basically you keep betting the same thing after each loss and vary the amount of the bet (the most notorious strategy is to double the bet-size after each loss) based on any number fo strategies. the idea is that the law of large numbers would eventually catch up with you and enough wins would show up to make all your losses good as long as you stick with the same strategy throughout.
Dr. H has been caught in a quasi-perma-bear stance in the face of a relentlessly rising market and he seems to be undergoing the front-end of a Martingale bettor. For all his acumen, his and his shareholders' fate now hangs on just how long this "irrational" market behavior can go on FOR WHICH HE HAS NO THEORY.
At some point he must have realized HE CAN"T LOSE when his thesis is not being followed by the market - he must have devised a strategy not to lose more than any uderperformance by his picks against the broad market. If instead of a 33 plus pct drawdown from the peak he is even or down no more than 5 pct, he would have perfect credibility. The NAV trajectory is clearly alarming - 50-6-70 pct drawdowns are perfectly possible.
The more the market goes up and the more he repeats himself whiel losing money, the more he sounds like Baghdad Bob.
Yet another precarious article from that other H:
jeez dude why dont you buy out his fund co. and close it since you cant stop talking about it incessantly.
he has to follow your advice? listening to your strategy is his only option?
I dont think he has any intention of closing it. he just opened two new funds in the last 2 years. he is not going away because you wish him to.
The only way he closes it is if all shareholders bail at once. a forced liquidation. Not gonna come from your ranting on a message board.
The Achilles heel in operation - he can't afford to keep losing - and so he has softened his puts and he ends up losing marginally today, instead of going up. If the market goes down a couple of days, he will have missed some "opportunity" - and he may strengthen the puts TOTALLY UNSCIENTIFICALLY only to have the market go up strongly and hand him a loss in excess of half--a-percent.
HE NEEDS A SCIENCE AS TO WHEN TO SOFTEN OR HARDEN HIS PUTS - it is his unscientific day-to-day guesswork in this regard that has killed him.
half plus percent losses are now disastrous - given how low the NAV has become.
There doesn't seem to be any way out except to close this horrendous fund.
hsgfx has great value since he has been losing money for so many years. the fund has a huge tax loss carry forward that hussman can sell and make a lot of money. what do you think of that suckers?
You're basing this on what is generally one data point. And keep in mind that the bulk of this miss was his goofy/emotional (IMO) insistence on depression-era stress testing nonsense. History tells me he'll be right about the end of this cycle too but his miss was so huge and prolonged that he'll be lucky to get back to break-even.
"He should admit failure of his approach and close the fund?"
Okay - that works.
"Change his approach to suit YOUR preferences?"
Let's see - I prefer to participate in bull markets and outperform in bear markets... so, yes - it would be great if he changed his approach to suit my preferences. Come to think of it - that would be the preference of most investors.
Now, let me ask you. What is YOUR point? HSGFX is among the worst performing US equity mutual funds in the world. You want to make a case for it? Go ahead. I am all ears.
and again your point is?
He should admit failure of his approach and close the fund?
Change his approach to suit YOUR preferences?
Stop buying puts options?
so, again, He is not gonna close the fund. Give it up. Sell your holdings in HSGFX and move on.
It's funny that you always mention the proverbial "dentist in Peoria." It's true, because that's the typical type of person investing in the stock market (dentists, doctors, engineers, computer scientists, professors, etc.). High IQ types (or above average IQ at least) who think they know everything and think they're smarter than everyone else.
I have said it before and I will say it again: if rocket scientists could predict moves in the stock market, they wouldn't be working for NASA. They would be writing smart-sounding weekly market commentaries and collecting fees from investors and getting rich in the process.