RE:RE:RE:Hexo, Bombardier Among Issuers Dropped by S&P/TSX Composite Worry… Fear and Uncertainty are products of three things for investors;
1 – Having more money in play than they are willing to risk
2 – Not understanding the full potential or long-term opportunity with the company they are invested in
3 – Not fully understanding how the markets work
Each of the above three items are equally as important however most investors are (IMHO) not considering, or paying attention to, at least 2 of the 3 items.
It is not uncommon to hear that “the market hates uncertainty” and those investors “uncertain” of what a delisting from an INDEX Fund means will either sell of hold off buying. Current investors who are “uncertain” may opt to hold and others may panic and sell rather than risk the uncertainty.
Investors who have researched the topic, and who are not concerned, may be looking for weakness in the share price and seeing that as a buying or averaging down opportunity.
Margin players who see it as an opportunity will be loading the shares into margin accounts to take advantage of what they foresee happening to the share price.
Investors will, as always and every day, have three options to consider; BUY, SELL or HOLD. Between all the investors trading this week and all the plays available out there the share price will go up and go down throughout the day… and everyday, as always...
Investors trading on a very short timeline will be jumping in and jumping out, investors with longer timelines will be making plays based on their own views of the company and what opportunities a change in share price may present to them for the term in which they are willing to hold.
From my own position (I am holding with an early to mid-2021 timeline minimum) I am not worried. Should I be? That depends on who you ask and what their take is on things. I have been doing my own research on the INDEX Funds and plan to do more over the weekend to ensure there is nothing that I missed. So far I have concluded one thing with certaintiy the success or failure of a company has ZERO to do with them being a part of an INDEX fund or not.
Success of a company is what ultimately matters and that definitely changes the share price.
At this time, with HEXO posting ever increasing percentage gains in sales QTR over QTR, their multiple Joint Ventures with Molson-Coors (the 2nd largest brewer in North America), their recent new product roll-outs (with more noted to come), the pending launch of their infused drinks into the Canadian and U.S. Markets I cannot help but be very optimistic that HEXO, as a company, will succeed in their endeavors and become EBITDA positive within Calendar Year 2020 as stated by the CEO.
AGAIN, I make no secret of being long on HEXO and a HEXO Bull. Investors opting to exit the stock at a price I think will work to my advantage may be transferring their shares from their accounts directly over to my own. Which trade will be the better one within the timeline I am willing to hold for is yet to be seen and we may not know for days, weeks, or months however I am willing to make the bet… and wait patiently for the returns I believe have yet to be realized on the stock.
Do your own Due Diligence, trade based on your own outlook and try to hold to the basic BUY LOW / SELL HIGH rule.
GLTA
Q
Quietinvestor wrote: Q you know there are clear guidelines wrt being delisted from the tax index - anyone can easily find them on the internet. The worrisome rule is that you cannot get back on the index for one year. Not good for my or your shares.
Glta