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Markets extract money from the impatient to the patient...
Hey. I recognize your moniker over at SG! I had mentioned in an earlier post here that I enjoyed the people who add contributing comments on SG. Well, you are one of the people I was referring to. You and Glenn and Ben (and some others) are just great. Keep up the good work....
Hi Regis, looking for your spreadsheet posting @ SG. In which article did you post your comment? I had a link to a spreadsheet saved as a bookmark, but the spreadheet is one for conference calls. P.S. I'm erv999 over there...
The other thing I like about SG is the people subscribed. There are doctors, lawyers, seasoned investors. Their comments also add value. They bring new investments to light. They add insights into investments under scrutiny. An unexpected benefit I didn't see coming.
I signed up for a yearly subscription to SG because I kept subscribing to various investment newsletters that had great sales copy, but poor actual performance. Travis would sleuth out the pitched hidden teaser of other newsletters and give a cogent objective analysis. It saved me all kinds of money wasted on other junk investment newsletters (let alone the huge losses I incurred by following the advise of those other newsletters). Then Dr. KSS started posting on SG. Wow. I instantly upgraded my SG account to a lifetime membership. KSS doesn't just advise, he also loves to teach. His articles are part investment premise, part lesson plan and part life story. They are just interesting. His picks aren't guaranteed winners (darn you, Benetec), but then again, what is guaranteed in life? As always, due diligence and responsibility always lies with each individual investor. But he's right way more often than wrong. End of day, I love Dr. KSS. He's one of the most interesting people I've never met.
Regis, I totally agree with you. Dr. KSS is not a fan when someone reprints his writings without his permission. If he grants permission, fine. But it doesn't sit well with him if no permission is sought. I'm worried that he will get frustrated and burned out some day. He puts in all kinds of time and energy with very little compensation for his efforts. The proverbial goose of the golden eggs. I am mentally steeling myself for the time when he goes away. I'm just hoping the sad day will be way off in the distant future.
That's funny. I have always felt that people should invest in the style of their personality. For example, an optimist should invest long in equities. A pessimist should short a stock. In other words, be intellectually consistent.
Another great thing about Stock Gumshoe: You know all the investment e-mail newsletters you get promising great returns if you subscribe to them? And those newsletters won't tell you their investment ideas until you spend your money on their subscription? I used to fall for a lot of those newsletters. They have very compelling writers. But at the end of the experience - great sales copy with horrible investment advise. Ever since being with Stock Gumshoe, that has never happened again. Stock Gumshoe does the sleuthing to discover the what the hidden investment is and offers a cogent, well thought analysis of all those sales pitches you get. I loved Gumshoe so much, I took the lifetime membership. The added bonus: sagely wisdom of Dr. KSS, and input from fellow investors. These fellow investors are no average group (smart, well educated, experienced) I guess I'm being verbose, but I am very happy with my experience with SG.
I think fear motivates people. When a share price is falling, they fear a stock will crash in price so they sell low. When a share price is rising, they have a fear of missing out (FOMO). So they buy high. A great strategy: buy high and sell low.
Allaying questions would have a material effect on the price of shares. Talk is cheap (in the real world as well as equities). The stock has trended sideways because of a lack of continuing concrete progress. Lacking this progress, the stock has experienced price volatility both up and down due to hyperbole and emotions. Application will be real world proof of progress towards approval.
Another million share day.
Looks like its going to trade over a million shares today.
The narrative of the story a couple of weeks ago: ARTH won't ever be able to accomplish anything. The stock isn't worth a dime. Sell, sell, sell. The narrative of the story this week: ARTH is going to be worth $100 a share. Buy, buy, buy. Rinse, lather, repeat. It feels like its about time for the next "it isn't worth a dime" narrative to begin. Followed by the $100 narrative. PT Barnum is spinning in his grave with envy right about now.....
Irrational exuberance. A couple of weeks ago, we had irrational pessimism. This seems like emotion driven trading. Short term stock price is driven by the emotions of greed or panic. Long term stock prices are driven by the facts of profit and loss.
May have been me. I added 50K @ market to my position. I had reduced my expose previously, but have reconsidered.
Two days ago, we had rain, snow, then bright blue skies with sunshine in Seattle all within a couple of hours. I think the groundhogs head is going to explode from the uncertainty...
Although it feels like we are still in the dead of winter, spring is just four weeks away. And the second quarter starts around six weeks from now. The second quarter is not really that far away.
For any stock publicly traded, the market hates uncertainty. Keeping investors updated fosters a stabilizing environment.
I've had more than my fair share of companies conducting new stock offerings just so they get cash for corporate officers to continue collecting salaries. With ARTH's shelf paper, however, I see them utilizing it for next year's FDA trials. Big difference between the motivation...
The ability to renegotiate corporate debt to less onerous terms indicates the company is less speculative to the lending institution. Good sign (and good management). The S-3 filing appears to be shelf registration. As they have a decent amount of cash currently, the shelf paper seems a precursor to next year. Dr. Norchi has said FDA application should be 2017. So this indicates ARTH is confident to go through application process on their own. Perhaps some people prefer that ARTH be bought out by someone like J&J. And, yes, it is fun when you see shares of a company you own increasing 50% or 100% on the news. But I have much higher expectations for ARTH. I'll take the 50 or 100% if they are bought out early, but I believe they are poised for much greater returns.
From what I see, I don't find ARTH on the Pilot Securities File list on FINRA's link. I don't think this applies to them.
Great point. If you are out during the weekend, it is over 60 hours (or around 1/3 of the week). I am deducing that the sentiment is positive for ARTH's technology. The issue is timing. People may exit on Monday to chase other short term trades for a quick profit, only to re-enter on Friday. They are fairly confident that ARTH will succeed, but barring new updates, they exit on Mondays to make quick trades for quick money.
"The stock market is designed to transfer money from the active to the patient." - Warren Buffett
When it comes to investing in bio, a wise mentor once told me, "Bad management almost always trumps good science". As the science looks pretty solid, the business acumen at ARTH will become increasingly critical. I like seeing Dr. Norchi with experience at Putnam and an MBA from MIT. MIT is not the easiest school from which to graduate.
I'm so happy that 600,000 share guy piped up. I've been silently thinking I'm out of my mind holding almost 200,000 shares. If you would have told me a couple years ago I would have that many shares of a penny stock, I would have said you were nuts. But so far, so good. Bought 100K @ .20, added 50K more at .43. I've been nibbling some more on down days. I still think I'm slightly crazy, but I'm happy with the performance since my initial January purchase.
Could you imagine how much of a pain it would be to run a publicly traded company? If you under-promise, shareholders punish you by dumping their shares today. If you over-promise, they punish you when your quarterly results come out. If you don't say anything, they accuse you of hiding something. If you say too much, they accuse you of pumping your company's stock.
Oy veh! I actually think that part of the salary of any CEO is to reimburse them for the purchase of vast quantities of antacid and aspirin....
ASL, I love that you are seeking to learn. Curiosity is an elixir of life that keeps people young at heart. The great news is that you live in the age of the internet. You can seek the counsel of the wisest people without even leaving your living room chair! In fact I advise most people not to go to college. Save the 200,000 dollar tuition - invest some of the money in stocks, put a down payment on some real estate and travel. Seek mentors both virtual and physical.
For learning investing, just do a Google search on "learn to invest". As with everything, some advise is not so good, but some is awesome. For example, Ameritrade has great beginners tutorial instruction. They do this hoping you become an Ameritrade client, but you don't have to. It's not quid pro quo. I'm not advocating Ameritrade; just using them as one example from a million sources. There are many great investing tutorial sites online.
I started using some of these sites for fun years ago. I even started the process of taking my Series 65 to become a licensed investment advisor, but I eventually decided not to pursue that direction. My point is that I gained much of that knowledge simply from learning on the internet.
You have some of the world's best teachers at your computer just waiting to share their secrets with you.....
Well, firstly, you have invested in the crazy realm of bio. There is no normal. Before results are released, people's imaginations run wild. Reality hardly ever lives up to the imaginations of people. By their very nature, people's imaginations are more grandiose than reality.
Secondly, if you think this drop is worrisome, you ought to see what happens when a company fails their trials. You can see huge gaps downward. 50% down. 90% down at the open. For every 1000 you invest, you get back 100. Ouch.
Thirdly, yes, it is common with investing to see selling on the news. This has less to do with the data of the news and more to do with timing. Before the data is released, there is a heightened sense of urgency to be invested. If the news is coming out in four weeks, you feel compelled to be invested today. But once the news is released, what is the next catalyst to drive the share price upwards? So some investors decide to sell on the news release and look for another investment with a news release that is imminent.
Fourthly, there is a word that is becoming increasingly uncommon. The word is called patience. Some people want things now. Today if possible. The end of the year is too long a time frame for these individuals. If you think about it, the end of the year is about 100 days from now. That doesn't seem too long away from my perspective.
Bottom line with ARTH in my opinion, great data. Investors wanted CE app approval closer to today, they are disappointed they are going to have to wait 100 days (give or take). The fundamental reason for being invested now has factual data to support the position. If the fundamental reason for being invested is still valid, then don't fixate on intraday or weekly share price swings. It will just give you an ulcer.
Thank you, tiguy, for your cogent comment. If you only own a few thousand shares, it probably wouldn't be prudent to quit the day job just yet. In this case, I think its just a case of people having fun letting their imaginations run. Investing in the biotech realm can be pretty brutal if you guess wrong. So when you pick one that performs well, it helps to savor the sweet taste of victory. The thrill of victory when you chose well has to sustain you through times when you chose poorly.
As we get closer to the announcement, its prudent to be long over the weekend if you are optimistic about results. From trading close on Friday to trading open on Monday is 65 1/2 hours. That's a long time to be out without being able to go long.
There seems to be a pattern of strong closes. The strategy may concern the news release timing. There are only 6 1/2 trading hours per day; the rest of the day is 17 1/2 hours. A news release on the trial stand a much greater chance of being released during the 17 1/2 hours of the day than it does in intra-day 6 1/2 hour trade window. If you are optimistic on the news release, it seems logical to be long overnight.
Funny. I'm in Seattle, and it made me remember when the Seahawks threw an interception on the one yard line to lose a Super Bowl to the Patriots. Ouch.
Great point. With the way investors micro analyze everything to the nth degree, every question a small company answered would create one thousand new requests for clarification. I believe the position is that the released data will speak for itself.
ARTH applying for approval in Europe is smart because the European approval process there is less onerous than in the US. But unforeseen events may also have an impact European sales of AC5. As I type this, I'm hoping I'm not being too politically incorrect.
Are there any events transpiring in Europe that involve mass hemorrhage trauma in the public sector? Does something happen to cause many people to bleed? Of course. Increasing amounts of bombing, knifing and shooting attacks. Terrorism. These events are increasing in frequency, and Europe is especially vulnerable. Many of the victims of these terrorist attacks bled to death. How many people could have been saved if their hemorrhaging was stopped earlier?
Do you think a hemostat product like AC5 introduced into the European market would make an impact? I do.
I wish terrorism didn't exist. I wish Europe had a peaceful future. But I have a bad feeling things will get worse before they get better...
That's wild when someone is pandering for a bear position. There is usually no shortage of people offering dire warnings. The strongest objection I've seen so far is the FDA's lengthy process potentially delaying US approval for ARTH. To me, this is not so much of a comment on the commercial viability of ARTH than it is a comment on the bloated and bureaucratic structure of the FDA. It is not just ARTH that is subject to the onerous FDA approval process, but it applies equally to every medical company. Back in the day, we used to call them bean-counters in the corporate world.
ASL, I'm assuming you are a younger individual and have limited funds to invest. If this is incorrect, I apologize. Also, caveat emptor with people offer advise (including my advise). Sometimes people offering alleged advise are really individuals trying to manipulate share price for their personal gain. There was a famous saying back in the 70's: trust but verify. In other words, take advise, but then research the validity of the advise. If you would have asked me what stock would have been a good first choice for you, I might not have suggested ARTH. That's not because I don't feel confident in ARTH. Quite the contrary. I think ARTH has explosive upside potential. I probably would have suggested something less speculative to you as a first time investor. When you first start out investing, you want to develop confidence by hitting a string of singles. If you start out trying to swing for the home runs, you wind striking out more often than not. If you lose money on your first ten trades, you might get disgusted and walk away from investing. Stocks trading below a dollar are also subject to wild price swings. That's great if you buy in, and it goes up 30% in a couple of weeks. It's awful if you buy in, and it sinks 30%. Having said all that, I guess it doesn't matter because you are already in. That figures. I'm famous for offering advise too late.......
ASL, you are so blessed. ARTH is the first company stock you've owned? I've been investing in equities for nearly 30 years (off and on). I've had a lot of good stocks, and I've had a lot of turds. I bought into ARTH in 8 months ago @ .20. I added more in April @ .43. I have never owned a stock that I felt had such a good risk-to-reward ratio. And this is your first stock? I wish I would have found an ARTH when I started back in the 80's.
.67 last Friday. .74 Wednesday morning. A 10% return in a couple of trading days. Hard to lay off that one. I have a butt-load of shares long as I believe success of the company is high probability. But nothing wrong with playing daily swings on top of the long position. Price drops tend to be fast - fear is a much stronger motivator than greed (in the short term)...
I should have noted that I was referring to Post 2905. In the time it took me to type my response, several other people had posted replies. Darn! I hate that I type so slow! I think the hardest part of doing my thesis was just typing it up.....
The agenda behind the previous post? We all have the same over all agenda in the market - to make money. Only the strategies will vary. The person positioned short will post that the company is fraudulent or that the officers are nefarious. The person positioned long will post that revenue will be 100 billion soon. The truth probably lies some where in between. In my case, I feel the rewards of being long are significantly greater than the risk. I like the soundness of the MIT based science. I like the short duration of time before events transpire (months rather than years). I love that the CEO is an MD and a former mutual fund manager. I love that this product will dramatically shorten surgery times (which will result in savings to hospitals). With the Affordable Care Act, hospitals currently don't want to go out of their way to spend more money, they want to cut costs. AC5 can do that. Having said that, is my agenda an attempt to manipulate you into buying more shares? No. Daily price movements are capricious. Buy or sell based on your own factual due diligence, not on the random and anonymous posts on message boards.