The Razor’s Edge
The Razor’s Edge
Shortman Studios
The Last Thing We Needed: Breaking Down the Archegos Capital Blowup
1 hour 10 minutes Posted Apr 6, 2021 at 8:00 am.
minute mark The Archegos and GameStop echoes
The scaling of the short squeeze strategy
Lone actor or market reflexivity at work?
What fundamentally changed during COVID for these sorts of names
The lack of an exit strategy
Aftershocks of this action
Adjusting to an elevated valuation environment and the leverage factor
The company and prime brokers’ perspective on this situation
Where do we go from here
The danger of consensus
Time to make weight for certain stocks
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Show notes
The Archegos Capital blow-up at the end of Q1 marked the second huge non-fundamental market event, mirroring the GameStop/Melvin Capital/vintage investing short squeeze dynamics of January. While these can feel like localized events, making or spoiling GSX or VIAC investors' quarters, they at the very least offer important reminders of risk management and understanding your underlying investments. We break down how something like this might happen and what it means for bystanders and active investors.
Topics Covered
Bonus: Article from Michigan Radio on sewer issues