So you'll be shorting the stock, I take it?

reticulates 4 hours ago | parent | next [-]

Shorting a company is not a trade against the future of a company, it is a trade against the market. You can know a company is going to zero and the company can go to zero and you can still lose your shirt from shorting it.

	▲	wickedsight 4 hours ago \| parent [-]
		"The market can stay irrational longer than you can stay solvent." This quote stops me from shorting pretty much anything.

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cmiles8 4 hours ago | parent | prev | next [-]

A lot of people will, if this IPO actually happens. But as is frequently pointed out a short is a market bet not a bet against the company and the market remains wild and irrational. You can be right about the company ultimately failing and still lose your shirt on a short.

However the price of CDS on bonds is already a strong market indication of where the market thinks all of this is heading. And none of that looks good if you’re betting on the AI exuberance continuing.

	▲	singron 2 hours ago \| parent [-]
		The bond market and the equity market care about different things. E.g. if the company has a 10% chance of going bankrupt and a 90% chance of doubling its market value, then paradoxically its bonds will look bad and its equity will look good.

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dpz 4 hours ago | parent | prev | next [-]

When you've got companies like Tesla valued at what they're valued at. Shorting is pretty dumb.

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surgical_fire 4 hours ago | parent | prev [-]

Shorting is not the only way to protect yourself from a bad investment.

You can simply not buy shares in companies you think are on a doomed trajectory.

That said, depending on the IPO target price, I might short it.