Coming out of the election over the course of anywhere from a few weeks to a few months:
Tesla was up nearly 100%
Bitcoin rose 60%
Microstrategy increased 112%
Palantir blasted 200% higher
Hims & Hers rocketed up 230%
The gains were immense as animal spirits took over and investors got overly excited.
The other side of greed is fear. The other side of exuberance is despair. And the other side of up is down.
Too much of a good thing in the markets inevitably turns into a bad thing. It has to. No asset can continue to rise indefinitely at those kinds of growth rates.
The other side for those big gainers now looks like this:
Tesla is down almost 40% from the recent highs:
Bitcoin is down more than 20% (and was down closer to 30% at one point):
Levered Bitcoin — aka MicroStrategy aka Strategy — has nearly been cut in half in a matter of months:
Panantir caught a 32% air pocket straight off a cliff like Wile E. Coyote:
Hims & Hers has lost more than one-third of its value in similar fashion:
This is the way it has to be.
You can’t expect to see outsized gains in a compressed period of time without the risk of outsized losses in a similar timeframe.
I don’t know if these recent highfliers will resume their ascent in short order or continue getting hammered.
Either way, this slap on the wrist is a nice reminder from the market gods that this game is not easy.
You don’t get to earn gigantic returns without repercussions.
