Back to the days when NFLX was hot, Tilson made the call to short the stock. He was RIGHT in his analysis of the company, and initialize his short position.
He was right in his analysis then, and bold enough to short the stock. He lost money and covered his short position, an action that was respected even he lost money. Why? cut your loss and move on. When you do against the market and lost money, you are wrong, as an investor. The best way is to admit it, and he did it.
When the stock dropped big on 10/25, he went long, thinking the stock was cheap. As we know, lower goes lower and cheap gets cheaper. He was grabbing the falling knife. The stock bounced and made a hefty 20% gain since he bought it before heading south again - up to $93.84 on 11/07 (he bought it somewhere between $78 and $80 on 10/25).
In stead of cashing out, he stuck with it. Bottom line? He is down $20 at Friday's close - a 40% swing on his 6 million client's money. He just said the stock could double in a few months IF and IF there will be positive news on the company.
He just does not want to admit that he is WRONG again this time and going against the market. Not to predict whether his "IF" may happen or not, the philosophy of going against the money and not admitting his WRONG when his trades works again him is a danger. So many "smart" investors get wiped out this way. Question to Mr. Tilson: Do you have more money then the market? You may believe in your opinion and stick to your investment philosophy, but not admitting Wrong will cost you if your investment philosophy is wrong.
It is all up to the market to make the decision. Never put yourself on the other side of the market. You were wrong calling the shorts but you were brave enough to admit you were wrong by covering your shorts. Now you are wrong again by going long and have lost 20% so far since you went long. Do the same thing again by admitting you are wrong.
Please remember, you are not BETTING on the stock (the word you used during a recent interview). The money you manage is your client's money, and you have fiduciary responsibility to them.