Hedging, hind sight, and responsibility..
The killer in playing the stock market is incomplete information..The stock market is risk betting which means you can win..but you can also lose. Most retail stock market players lose money..Most lose all their money in a period less than a year because they are playing against professionals who have more and better information than the retail...But even the best funds with the best strategies can and do lose all their money..Because their strategies (all strategies) can be counter traded. And there are funds that
prey on the weak...
If you "play the market" you need to take responsibility for your own mistakes...Two years ago JT was an all star...Tom Brady, Larry Bird and Bobby Orr all thrown together..Now he is a bumbling idiot. He should have settled...Well we to this day do not know if he tried to settle. What we do know is he reached a settlement with TEVA...Does it not make sense he would have made overtures to Reddi and Hickma...Maybe they just were more confident than TEVA..We just do not know..But more to the point..You and I as shareholders, did not need JT's permission to hedge the DC's decision..We individuals made that decision..Not JT...
Actually in terms of the bet being asymmetrical...It was a no brainer. The PPS was double digits and an unfavorable decision would have definitely sent the price down below $5...So why did so many of us (self included), not hedge the bet. THE REASON WAS.. WE ALL THOUGHT THE DECISION WAS A VIRTUAL CERTAINTY CONSIDERING AMARIN'S ALL STAR LAWYERS AND THE ISSUES. We just never considered we would get a Judge Du for the trial..
The hedge this time around is not so clearcut. The PPS is in the mid single digit range, a win for Amarin would likely result in the PPS to go into the low twenties...A loss and we would essentially be in the same position we find ourselves in today..The PPS would be a knee jerk drop into high 4's or low 5's...With a gradual return to today's prices..
All this ranting and raving about how JT screwed up is just hind sight. Looking for the culprit...Go look in the mirror..When to hedge and not to hedge is based on estimating what the effect on the price the event is going to have...Often times there is going to be a small difference one way and a very large one the other. And that should determine whether or not to hedge and not your gut feeling on which way the the event is going to go..
Finally if you play the market...you have to take responsibility for your own mistakes...As the real Jesse Livermore pointed out..If a man did not make mistakes he would own the world in a couple of months..The mistake family is a very big one..We all make them..Step one..take responsibility..If you always have somebody you can blame..How are you ever going to learn...
":>) JL
