Sigh – Some Stocks I Sold

I went into the new year with a lot of cash. But on the last day of trading I added a number of stocks that I thought would be tax loss reversal candidates. These are the stocks I mentioned in the last post.

It has not worked out very well.

Radcom, Silicom and Finance of America are flat with where I bought them. BM Technologies is up a tiny bit. But the rest, which are all biotechs, have not done well.

I sold Mustang Biosciences and Checkpoint Therapeutics yesterday and Caribou Biosciences and Sangoma Therapeutics today. These names were supposed to bounce into the New Year. Like just about every biotech, they have not. So I’m not going to turn this into some other thesis. I just sold.

I looked more closely at Mustang and Caribou this week, as they fell and I took the loss. You can certainly make the case that Caribou is oversold. I do want to buy it back at some point. But its in some sort of genomics death spiral right now, just like its bigger CRSPR kin like CRSP and especially the smaller guys like VERV and GRPH. It also doesn’t help that allogeneic CAR-T, which I described last post, is in the dog house right now. Allogene, which does a completely different gene editing technique to what Caribou does (called TALENS), had a trial put on pause by the FDA back in October. The reason was a patient saw a chromosomal change, and it may (not for sure) have been caused by Allogene’s therapy.

But this isn’t super good for any company looking to take T-Cells, edit them, and put them back in.

Mustang and Checkpoint just aren’t acting well.

Finally, I sold Sangamo today because my timing was awful. They released the end of a partnership with Sanofi, three days after I bought it – ugh!

These four names were a nice whack to my portfolio that wiped out much of the gains I had over the last few days in the banks and SaaS shorts. This makes it all the worse. My long held banks and SaaS are finally working only to see their gains fluttered away by a bunch of new stocks I just added last week.

It is frustrating.

So on the biotech side what am I left with? I’ve kept Arca Biopharma, Aldeyra, and Lyra Therapeutics primarily because they all trade at or below cash. Arca trades at a ridiculous amount below cash at this point, they could operate 2 years and still be below cash.

While these stocks are still going down, there appears to be no urgency to the selling anymore. They go down on a few shares and not too much volume.

That is very much not like Caribou or the rest of the ARKG or ARKK names or the SaaS names, which have been going down violently, at least until today (today is either the bottom for SaaS or it is going to get nasty IMO).

And that is really the root of my problem here and why I just can’t hold conviction here. This market has the same feel it did to me in December.

I will probably be completely wrong about this, and so I won’t try to predict the demise of SaaS, or ARK, or TSLA, or MOMO because doing so has proven to be a fools game. There is no multiple too large! In fact, today could very well be the bottom for these names. It was just the sort of day that often does it – a big whoosh in the morning and a quick recovery.

The charts of many momo names look wild -big swings in both directions and the start of a breakdown in the uptrend. I can’t shake the feeling that if the wheels were ever going to come off on these names, this feels like a good time for it.

That is a wishy-washy statement. But I can be wishy-washy because I’m not heavily positioned either way in them. I covered about half of my SaaS shorts today, the better names like Crowdstrike and Okta. I continue to hold the weaker names, and I am cringing that another big bounce is coming. I still have my index shorts just in case.

I’m comfortable owning banks, a few biotechs trading at cash and the usual assortment of micro-cap odd-balls. But apart from that, I am best off staying cautious. This last week is evidence of that.