Read on Twitter
Thread on my 10 biggest losers since inception and quick lessons learned, because why not:
(In alphabetical order -- most cost somewhere ~1-3% of performance)
Long Camping World – don’t make excuses for lousy management, no matter how “cheap” a stock appears. Don’t get cute flipping long on shorts. It's not clever (the other direction is mostly fine).
Long Crown Hldgs – balance sheet matters above all else in a crisis. It doesn’t matter how defensive you think the underlying business is. Move slowly.
Long Ferragamo – what does the controlling family really care about? Why should this *ever* change?
Long Hilton Grand Vacations – still processing, but long anything travel is obv a tough spot to be in during a pandemic. Only takeaway (for now): hedge faster (easy to put a basket together + doesn't need to be scientific).
Short IYR/MDY – hedges (vs. single-name shorts) suck. Sometimes they’re necessary (maybe?), but they are really more like insurance: *designed* to cost you money in the long-run.
Long Natural Grocers – Mgmt stepping on the gas w/unit growth despite decel/declining comps = auto-short. Do a YouTube search for small ~retail-oriented businesses (seriously, check this one out).
Long Subsea 7 – too early to tell, but reemphasized importance of sizing small and moving slowly (so far done okay in this situation on that front) in deeper value, commodity-driven names at edge of competence.
Short Tesla – if you must be involved w/battleground short keep it annoyingly small; heavy newsflow makes everything more time consuming and requires even higher bar.
Long [Undisclosed toehold since exited] – just because a dividend cut seems obvious, doesn’t mean the market will be anywhere near okay with it.
Short YETI – give (crowded) fads time and space (size really small). At a certain point, the crowding just isn’t worth it.
Bonus (only cost 50 bps, but biggest in % terms, as company went BK) -->
Long Performance Sports Group – “great brands” is a completely meaningless phrase if financials don’t back it up. Always note unusual changes to comp structure.
Long Performance Sports Group – “great brands” is a completely meaningless phrase if financials don’t back it up. Always note unusual changes to comp structure.
