Post by ezrasfund on Dec 16, 2014 10:27:20 GMT -5
The Black Swan event has already happened. Who predicted that the price of oil would fall 50% in a matter of months? And while the price has only dropped 50% it is a different story for many high cost producers. Their margins have dropped 100% and more (as in loosing money on every barrel produced). And as we have all read, Russia, Iran and others will face some serious problems. The canary in the coal mine for the broader market might be high yield debt, which is preforming pretty poorly.
But that is just a rehash of the front page financial news, and we are here to talk about MannKind. The question is will it follow the market, be inversely correlated, or mostly independent of the S&P? My guess is that it will be largely independent as it is a small cap stock with some very important catalysts coming up. But that is not much of an insight. What I am wondering is who is more leveraged, MNKD longs or short, as times like these tend to flush out the over-leveraged. So stay strong (and thirsty), my friends, and we will see if this slow motion train wreck forces the shorts to cover some of their positions.
But that is just a rehash of the front page financial news, and we are here to talk about MannKind. The question is will it follow the market, be inversely correlated, or mostly independent of the S&P? My guess is that it will be largely independent as it is a small cap stock with some very important catalysts coming up. But that is not much of an insight. What I am wondering is who is more leveraged, MNKD longs or short, as times like these tend to flush out the over-leveraged. So stay strong (and thirsty), my friends, and we will see if this slow motion train wreck forces the shorts to cover some of their positions.