Quick sellers are “jerks who want us to die.”
“Short selling should be illegal.”
These are feedback that Elon Musk, chairman of Tesla
I disagree with Musk. I feel quick promoting serves as a helpful counterweight within the market to hype artists who exaggerate the deserves of varied stocks. I’ve been recognized to do a little bit of quick promoting myself. And annually, I sponsor a short-selling contest. I name it “Short Sellers Don’t Have Horns.”
The winner this yr is Peter DeFilippo of McDonald, Pennsylvania, who’s an accountant for Bayer. He have to be one heck of a superb accountant. DeFilippo took first place on this contest in 2016-2017, first place once more the next yr, second place in 2018-2019, and now prime honors for a 3rd time. For all his success on this contest, DeFilippo doesn’t promote stocks quick in actual life. For him, this contest is an mental problem.
A yr in the past, DeFilippo selected Pier 1 Imports
I haven’t but determined what his prize might be. I all the time give a prize associated not directly to the phrase “short.” Up to now, DeFilippo has acquired shortbread cookies and a recording by pianist Bobby Quick. I intend to proceed in the identical whimsical custom.
For the approaching 12 months, DeFilippo thinks that Eastman Kodak
Lately Kodak has tried to reinvent itself as a producer of hydroxychloroquine, a drug initially used towards malaria that President Trump says is efficient towards the Covid-19 virus. In July, Kodak seemingly secured a $765 million federal loan to start its pivot to drug making. The stock jumped from $2.23 a share to $21.85 that month.
Since then, questions have been raised concerning the loan, and Kodak may or may not ever get it. The corporate is being investigated for the way by which it introduced the loan, and for executives’ stock purchases previous the announcement. The stock has subsided to $12.11 as of September 18.
DeFilippo says, “There is some risk of their being in trouble.” Additionally he’s not certain the proposed new enterprise line “makes sense with their legacy business.”
Silver and Bronze
Second place went to Harry Feld, a retired chiropractor in Beverly Hills, California. He recommended shorting retailed J.C. Penney (JCP), which he appropriately predicted would go bankrupt inside a yr. Its stock declined nearly 80%. I used to be unable to succeed in Feld to get his decide for the approaching yr.
Third place was received by Greg Smith, an information-technology director from Olathe, Kansas. He selected a brief on Peabody Vitality
Wish to Attempt?
If you need to check your prowess as a brief vendor with out essentially risking any actual cash, enter my 2020-2021 Quick Sellers Don’t Have Horns contest.
The subsequent contest runs from October 1, 2020 by September 10, 2021. Entries have to be postmarked or time-stamped by midnight September 30, 2020. To enter, please present (1) your title (2) deal with, (3)telephone quantity, (4) occupation, (5) the stock you’d quick, (6) its stock image and (7) a quick assertion of why you assume the stock will fall. I would like the telephone quantity in case you win and I wish to interview you.
Ship entries to [email protected], or to John Dorfman, Dorfman Worth Administration, Suite 1900, 101 Federal Street, Boston MA 02110.
You may promote quick with actual cash if you want, however that’s not essentially for the competition. Should you do quick in actuality, take into account that it’s a high-risk approach.
The stock you promote quick have to be that of a U.S. firm, however contestants can come from any nation.
Disclosure: A hedge fund I handle has offered quick shares of Tesla.
John Dorfman is chairman of Dorfman Worth Investments LLC. His agency or shoppers may personal or commerce securities mentioned on this column. He could be reached at [email protected].