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0 pointspge6y ago0 comments

I agree with your larger point that his dealings are a huge red flag, but just to clarify, a bunch of that money was borrowing against his existing stock rather than actually selling to investors, which is quite different. Selling can imply a lack of confidence in future value, while borrowing against the stock implies some level of confidence.

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wpietri6y ago

When I was in financial trading, I think that's what we called a "Texas hedge".

(A hedge being where you take some of your money and buy protection against downside risk. For example, since I'm in tech, it's in my interest to sell some of my company stock and buy something that is uncorrelated with tech. That way if my company blows up, I won't be totally broke. The Texas hedge is doing the opposite, so that you're even more screwed if the bet doesn't go your way.)

This could indicate confidence, but it could also indicate a double-or-nothing mentality. You can only be so bankrupt, after all.

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0 pointspge6y ago0 comments

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wpietri6y ago

When I was in financial trading, I think that's what we called a "Texas hedge".

This could indicate confidence, but it could also indicate a double-or-nothing mentality. You can only be so bankrupt, after all.

j / k navigate · click thread line to collapse