The Inside Word #5 With @Pattionthemoney +More
Microsofts Dominates + Is Avis Another Short Squeeze?
November 5th, 2021.
🚨 New Article 🚨 - The Inside Word #5
In my fifth instalment of The Inside Word, I caught up with Patti from Pattionthemoney. Patti is a super impressive woman spreading some empowering messages on a variety of topics related to investing and personal finance.
I'm certain you'll take a couple of gems out of this one!
You can read my interview with Patti using the link below ⬇️
What Caught My 👀 This Week
The 2021 SPIVA report revealed that 86% of Australian Equity Funds underperformed the ASX 200 benchmark over a 15-year period.
An investor simply tracking the index through a low-cost ETF, over the same period would have outperformed 86% of the ‘experts’.
#From Around The Web
Microsoft Demonstrates Its Supremacy Amongst Big-Tech
Some of the big tech juggernauts like Apple, Amazon, Microsoft and Alphabet (Google Parent) reported a mixed bag of results last week.
One thing that stood out was Microsoft surpassing Apple to claim the worlds most valuable company title after exceeding analyst expectations for its first quarter 2022 earnings.
Amazon and Apple both reported underwhelmingly compared to analysts expectations largely as a result of shorter-term supply chain constraints and sold off accordingly.
Unlike Amazon and Apple, Microsofts business model benefits from being largely software-based, which means results weren’t overly hampered by the supply chain issues plaguing Apple and Amazon.
Microsofts three core business units, Productivity and Business Processes, Intelligent Cloud, and More Personal Computing touch almost every key software market and are all growing like the clappers.
Revenue grew by 22% for the quarter across all three overall, with each segment posting double-digit growth. Unsurprisingly, Intelligent Cloud led the way posting 29% growth.
This article delves deeper into the strength of Microsoft’s diversified business model by analysing key business health metrics and provides a rationale for why it might be undervalued at current levels.
How This U.S. Hedgefund Stands To Make $5Bn In One Day Thanks To Another Suspected Short Squeeze
Little know hedgefund SRS Investment Management is in-line to earn billions from their investment in Avis after their share price jumped over 100% on Wednesday.
SRS first began accumulating a position in Avis all the way back in 2010, and have since become the largest shareholder with a 27.7% stake in the rental car company.
The spike in Avis share price was partly driven by Avis executives alluding to analysts that they may be considering adding electrical vehicles to their rental fleet.
Another driver behind Avis dizzying share price rise is likely another short squeeze event.
When the value of a stock rises sharply, short-sellers buy shares to return to their lender to minimise their losses. When short sellers buy stock, the share value rises even higher.
Prior to Wednesday, about 21% of Avis free float shares were held short, helping to trigger the short squeeze.
Avis joins the long list of ‘meme-stocks’ like GameStop, and Bed Bath & Table that have undergone short-squeezes in 2021.
Although 2021 seems to be the year of the short squeeze, I thought I’d do some digging into other famous short squeezes in years gone by.
This article shares the stories of some of the most famous short squeezes in history. The one that intrigued me most was the Volkswagen short-squeeze caused by none other than Porsche! This video explains the saga in detail.
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