This post was just published on ZYX Buy Change Alert.
This post is in response to a large number of emails we have received today. Previously we have provided intelligence on GSVC as a way to buy Twitter ahead of Twitter’s IPO. At the time this intelligence was provided the stock was trading at $13.73. Since then the stock has traded as high as $16.90. The stock still has the potential to hit $20 or higher, but the risk is high as explained below.
Please note that there has been no official recommendation because of the high risk. For us to recommend, a stock must pass at least four of the six screens. We prefer a stock to meet all six screens. Our rigorous criteria has led to enviable performance over a long period of time. We periodically provide intelligence on trades that we do not recommend, but our subscribers may be able to take advantage.
It is important to understand that the trading mechanics of GSVC is quite different from Twitter itself.
- GSVC is not protected by a syndicate bid like TWTR.
- GSVC has a nasty habit of doing a massive secondary when the stock goes up. If GSVC repeats the pattern, it will dampen the stock of GSVC irrespective of the performance of TWTR.
- There is a lot of hot money in GSVC. If this hot money decides to exit, the exit door is simply not wide enough for everyone to exit. In such situations it is common for a stock like GSVC to drop as much as $5 in a very, very short time.
