Hi Fuhc,
You hit the nail on the head in your last two posts.
The three different types of investors all need different tools to achieve their Goals and what is important to one is often irrelevant to the other.
Day traders:It's a given that day traders need only worry about sentiment during a half hour interval to try and make a living trading shares. It's fair therefore to say that
TA is all that is important to them. What the company does or how profitable it is, is irrelevant.
Medium term investors seeking to multi bag:If FA leads them to believe that a 7.5c share is headed for 50c in a matter of months they don't care if they pay 7.5 or 7.6 and
will be happy to kick the price up if a lot of shares are on offer to load up while its selling so cheap. They also don't care if they pay an average of 8.5 to spend all their money even if the price drops back to 6.7 on the shares that might subsequently trade at those lower prices If they have picked a stock that is a favourite in do well stakes.
Long term investors seeking to do a couple of % better than the market average. After FA has uncovered a good low risk stock that the market is undervaluing they
need to make sure they don't pay too much which is where a bit of TA is helpful IMO.
Hi Opex:
As you know Truth Social is one big red flag to anyone who looks beyond what the Share Price is doing.
Truth Socials brief history leading up to, and subsequent to, being listed on the NASDAQ through the back door, is one of the worst examples of what the WAGs of Wall Street (the Market Makers) get up to while lining their pockets via massive fees.
The plan involves bypassing all the checks and balances and independant valuations that are part of an Initial Public Offering which allows the WAGs, in Truth Social's case, to value a company with 36 employees, no revenue and no business plan to get to profitability at an EYE watering $1,700,000,000.
DCFC and GGR are good examples of where the Wags overvalued companies and after the Market Makers pumped them up to allow them dump all the initial seed capital and their free carry before they left the building and the the real truth emerged.
The real Truth:Truth is unlikely to ever make a profit because Trump relies on ,dare I say it, fraud, to get rich.
The details for those interested:"Truth Social’s debut to the world as a publicly traded company came through the vehicle of a SPAC (Special Purpose Acquisition Company). These became popular a few years ago. It's a quick way to get a company into the public financial sphere while circumventing the long and costly regulatory procedures of a standard IPO filing with the SEC. This is accomplished by the SPAC merging with a target company that wishes to trade publicly.
The SPAC is a regulatory instrument used to list companies on NASDAQ that has a business plan to merge with a target company when they find one. Nothing to disclose in a prospectus at the time the SPAC is listed apart from trust us to find something to merge with.
The SPAC company that absorbed Truth Social is DWAC with is Trump Digital World Media, another Trump company. It is very rare to see an entity start a SPAC in order to acquire its own company.DWAC raised $300 million by selling shares of the SPAC at $10 per share before it merged with Truth Social.
What followed was:
*The Market Maker Wags put in $300m for a small percentage of the merged company, I guess because a lot of people obviously think that following Trump will make them rich, and the wags thought they could take advantage of that sentiment to line their pockets and mightn't loose the investors funds they were putting at risk.
* the Wags got a pile of free carry
* Trump offloaded a company with thirty six employees which had no revenue and no defined path to profitability for $1.7b and emerged owning 57% of a company which the market makers after listing made sure, using more of their investors funds, hat Truth Social had a price chart which ticked all the TA measures so that it could attract traders and the gullible to rise dramatically after the merger. This of course allowed them to off load all the seed capital funding at a big profit for their investors, together with their free carry, before they finally leave the building to get richer duding the next lot.
The Market Makers (whose participation is funnily enough a precondition to listing on the NASDAQ) after making their followers and themselves a tidy profit will leave all those who bought the rising share price story holding an empty can.
The market makers: I guess when you are selling pie in the sky you need someone on the ground fuelling the buy side. A good fund manager will do that but only until the gullible buy the story and pile in so he can get all his loyal followers out to fund the next fairy tale. SPACY as that may be.
The really big Red Flag
(20min delay)