It's that time of the year when loser stocks like EGT will be sold for tax write off purposes. A lot of people bought EGT a lot higher last spring so they will now dump EGT to lower their taxes. The end of year tax selling will drop EGT to close to $1 by December 31st. No news will be coming out to raise the stock until next spring or summer, but I don't think there will be any good news at all in 2013. I am sure I will be bashed by longs for writing all of this.
You have a very strange definition of "Loser Stocks". On 1/4/2012 EGT was closed @ .92 (split adjusted). Today is is 2.11
Not quite sure how a 2x+ qualifies as a "Loser" for 2012 - especially when you compare it to the overall market (pick ANY market index and compare).
I think that you math is WAAAaaaaay off and if we see any tax selling it will be far less than a 50% impact on PPS - too muich has improved in the business model over the last year to see that much of a fluxuation.
But, if you REALLY believe what you post is true, feel free put your money where you mouth is and short EGT *BIG* on Monday and hold until it reaches your 1.00 target on 12/31. Please post when you do so we can track your 'success'.
Lots of times I agree with what you post, but this time I don't. Most of the volume in EGT this year occurred in May-July when the average price of EGT was above $3 [adjusted price]. To me that means there are a lot of investors that are 'under water' on EGT now. I do think there will be end of year tax loss pressure this year.
I sold half my holdings in late October at $2.39 in anticipation of that. My cost basis for the rest of my stock is only $1.04 so I will hold that through the expected short term tax loss selling. I might buy again in mid January.
im not going to bash you, but i will tell you that every year for the past 5 years what you say is about to happen.. happens!! BUT; they always seem to come out of it in good shape. and they never have dropped by 50% that I can remember.... having said that, think of what is about to happen as a very good, tried and proven for 5 years running, fantastic buying oppertunity. Timing will be everything. I do not do that but have watched from the sidelines.... this is definately the buying oppertunity of the year because it just about a guarantee if history proves to be true
Sorry, I must respectfully disagree with your conclusion.
Your post caused me to think. I went back through the last 5 years to 2007-2012 and pulled the historic prices from the first day of December through the last day of January. My research found your memory might be wrong.
I used the prices (high and low) of Dec. 1st. and Jan. 31st. Then I found the high and low prices for the month of Dec. I also did this for Jan.
The information I gathered showed me no diffident pattern. At times it is correct prices do as you suggested. At other times they don't. Either way the price fluctuation usually is not much, most of these fluctuations are less than 10%. To me these price fluctuation are not enough to even think about using it as a trading opportunity even if they had proved to ALWAYS work.
I would strongly suggest to anyone thinking of using this as a trading or shorting opportunity to do some research before you decide to do it.