Also should be mentioned that aveo was probably the most spec play in his portfolio and his smallest position. He wasn't risking nearly as much here as he would on a more conventional value play, but he was counting on a huge price appreciation in the stock to compensate for that, and the position went completely against him.
as a longterm holder of aveo myself I know the prices at which Klarman bought and can tell you he had been deep underwater on aveo for a long time. when aveo continued to fall further after FDA rejection klarman did not buy more. But he did wait awhile longer for a turn around. Klarman always exits positions after a certain time/loss to preserve capital. He puts the money into his teams best new ideas where he feels it us far more likely to make profit (and usually does). Ironically and sadly klarman sold out just before the real positive transformation of aveo began and good reasons to buy emerged. he's a great investor but he doesn't have a crystal ball and just like the rest of us has made decisions which have lost him money.
Since you stress you are an investor and not a trader I suggest you don't pay much attention to short term volatility. Especially in the bio sector stocks can have steep drops and steep rises at unexpected times often in quick succession. As an investor you must have a longterm thesis you are comfortable with, so I'm not sure why you'd sell a single share. Nviv is in such early days I'd just be adding on the dips, which is what I did today, twice. I csnt say I care too much about the drop from 20. I've been through that and a whole lot worse with other issues which have gone on to make tremendous profits. Trying to time the ups and downs or getting hung up on them is the mark of the trader. Slowly building a position over time and buying when others are fearful is the mark of the investor. So long as nviv isn't your only holding it shouldn't matter and I wouldn't take the advice of those who say to sell and get back your original investments thst I'd trader-think and will severely curtail your eventual profits. Patience and confidence that goes past short term price moves is the key. Klarman holds his positiins for years and usually does nothing but add on dips. Recently he finally lost patience with another holding of mine,AVEO, and sold out. Turns our he sold out just before a flood of good news and a transformation of management. I think he will regret it. The moral of the story is have a thesis and stay confident in it for much longer than others can and will if you want to make really big money on an investment. Sometimes you will lose but the winners will be so lucrative those losses will fade into insignificance.
No way in h3ll it goes for less than 10. The value here is massive but perhaps not well understood by the majority of traders or else traders are just totally focused on the risks which is why the stock trades so low. Someone mentioned idix in another post. Keep in mind not long before idix was bought for 25 it was trading at 3. That's right you could have bought it at 3. And at that time in the idix board the usual suspects were saying it would soon be trading on the pinks. bet those guys have had their accounts closed by their brokers now and are deep in bankruptcy.
Doubt aveo will ever get to 50. Due to its portfolio, aveo is a major buyout candidate. A big player will step in, it's just a matter of time. That limits the upside but at the same to provides a margin of safety. Won't be sold for less than 10 IMO.
although I'm aware you may only be flaming me, I want to clarify something about what I said, just in case anyone else is as confused as you are about the point of my post.
My post is not intended as an "invest like Warren Buffet" guide to the market. I don't recommend people invest like Buffet, because actually I don't think anyone can invest the way he does except for himself. However, I believe that it is possible to buy a biotech stock using as much diligence as Buffet would have used to make one of his investments. You have to invest in what you feel comfortable with - for some people that is biotech, and some people do very well at it. Investing in biotech companies is no more gambling than investing in individual issues generally, in any sector of the market. In fact it is possible for a diligent investor to make a MORE informed decision on a biotech investment than on a less diligent one who just throws his money into a bluechip.
Seth Klarman, one of the greatest value investors of all time, routinely invests in biotech. And he is not a gambler. So what does that tell you? The obvious conclusion is that he thinks informed analysis and valuation can be done on any kind of business.
But to return to Buffet: what you say about his investing style is valid, but it isn't the point of my post. The point of most post is to draw on one investor's experience to make a point about individual stocks generally: they fluctuate wildly. Buffet's point about be willing to hold through 50% downswings is a very important one for investors, because it is common, not uncommon, for stocks to have those swings. The OP said he was down over 50%, I believe, and my reply was in reference to his predicament. Being down 50% on a stock is no big deal, if you are confident in your thesis. Short term traders talk about it like it's the end of the world, and that's why I reference Buffet, who looks at it much more realistically and sensibly.
Good luck with your investment
Sentiment: Strong Buy
Why not good? It's just part of the investing game. Buffet has said no one should buy a stock who isn't willing to hold it when it goes down over 50%. If you attach any importance to Buffet's experience as an investor then I think you understand that what he is saying is that a 50% drop in a stock isn't at all unlikely.
What matters is where the stock goes in the longrun, and that's why you invest. You might be down 50% now, but what does that matter if you are up 500% a few years later?
Which is a very real possibility with SNTA.
Short term fluctuations are meaningless to an investor, because investors understand that short term movements in stocks are controlled by traders.
Traders have no clue about business or stock valuation. Many of them don't even WANT to know what lies behind the ticker they are trading.
Profitable investing is a test of patience.
Nervous nellies who check prices every day usually sell for a loss or get out for a small profit. So they aren't around when the big move happens which makes longterm holders rich.
The bears are shorts talking their book. Nobody ever knows what is going to happen tomorrow, but is down trending stocks that are totally crushed and threatened by bankruptcy bears always keep tight control of the msg boards. That's why well sized positions in distressed issues can pay off huge if bk doesn't play out, but of course you've got to have a strong stomach.
The key sentence: "He has also prepared a significant number of expert and rebuttal reports and has assisted counsel prepare for numerous depositions and trials."
Everyone seems to be assuming settlement. That is not my take on it. Don't think the gov is going to give up that easily.
If you read carefully you will see he has worked in cases of rebuttal. Seems more likely gov has hired him to rebut the case being made against them. They are being accused of fraudulent and unlawful taking. His job is to make their actions look legit.
How he can succeed at that I don't know, but that seems to me the most likely reason he was hired, at the present juncture.
A couple pf other things: I recommend avoiding the leveraged ETFs - yes, the same ones which everyone here on Yahoo msg boards claims they are trading and making fantastic gains on. Avoid anything that uses leverage and looks like it offers a fast route to outsized gains, because you are far more likely to lose every cent you put into it than make the gains yahoo msg board posters boast about.
I would also look at ETFs in more distressed areas as longterm investments and build a position in them over time. Right now, for example, that would mean a regional ETF like one focused on Russia.
nefarious, there are no miracles, unfortunately. risk management will serve you much better in the long run than expecting a miracle, though it's less glamorous.
as you know, in my trading and investing I prefer to focus on volatility products. But that doesn't mean that's what you should do yourself. you have to find instruments you are comfortable with and feel confident trading and holding big positions in.
Now there are ETFs for just about everything: commodity ETFs, volatility, country, sector etc. etc. What I recommend is getting familiar with the universe of ETFs and trying to papertrade those that you feel most comfortable with for awhile. You need to develop your own strategy through practice and experiment, which is why paper trading is a good exercise.
The good thing about an ETF is that unlike an individual business it isn't going to go bankrupt on you. Some ETFs (like commodity) are more subject to wild swings, and you could suffer a big drawdown. But if you learn to trade swings on vehicles like this, you can make money a lot more safely and surely than betting on individual companies.
Don't put all your funds into just one ETF. Even here, diversity is what will keep you in the game. I'd say have at least 3 you watch and can switch between.
Anyway, there's a few ideas to get you started. Good luck.
Don't be too hard on golfband.
I'm pretty sure he meant .50
he just forgot the decimal :)
If that is the kind of return you want, I think you are much better off investing in NVIV.
But that is not where I'd put all your remaining capital if I were you, just a small percentage of it.
For the rest, learn to trade an instrument not dependent on the success or failure of an individual business.
first, you are recommending nefarious buy an individual stock, which is the highest risk investment.
but that's not bad enough. you go further and recommend he buy a decaying instrument to control that stock. so you are increasing his risk one hundred fold, and putting him at risk of losing everything if those options expire worthless.
if apple's business suffers an adverse event and stock price is impacted accordingly nefarious will lose everything, and not have a cent to his name.
at least if he only bought the amount of apple stock he could afford, he'd have a chance of recovery with time, but the options put him at risk of total loss of his capital.
I have read so many irresponsible options recommendations like this on yahoo msg boards that I have to assume more than half the people posting here are options brokers.
the only valid reason anyone who is not a professional options trader should buy options is to hedge equity. the rest is just gambling, and the last thing someone who has lost almost all of his capital should be doing is gambling.
Whatever you do, do not invest in an individual business after the setback you have suffered. you need to decrease risk, not increase it in a last insane gamble to make back what you have lost. following that path leads to bankruptcy far more often than to a recoup of capital.
only people who will blow out are those who are using leverage. which means those who trade using options or margin.
as for the rest, even their whole account is invested in SVXY, they'll be fine, but they'll have to be patient.
personally I'd rather be invested in SVXY than stocks when the crash comes. It will get hit much harder, but it will also rebound faster. but the main thing is to be prepared for such a event by having ample cash to deploy.
you've been done a lot, but haven't gone anywhere, so far as I can see.
the answer to your question is already before you eyes. VXX doesn't just go down. It can go up quite big and it can also remain elevated for awhile in certain circumstances no one knows when it will happen.
shorting instruments like VXX and UVXY you are among the most exposed to fat tail risk.
In other words, it just takes a few minutes or a few days to bring you down to zero. Shareholders might be bleeding bad, but they won't be totally decapitated like VXX shorts.
so that's the risk here, a very big risk which few are willing to take. which is why most are too afraid to mess with volatility funds and so few who do understand them.