I may have overbooked my weekend yet again and drank one too many glasses of the firewater but despite all of that, I am actually feeling pretty peachy today. I think it’s because of the people – I saw a bunch of my old friends, made new friends and shared great laughs and stories. It’s that energy which is really working as an antidote to my hangover today.
There are many stories to tell but there was one underlying theme that was central to all conversations. The theme of Online Dating. Especially because cuffing season is around the corner, and peeps are eager to get hinged! You folks know that swiping hurts my thumbs but I am always curious to hear about others’ experiences. The fiascos of online dating make for some real comedy, and I’m here for it! But before I digress too much, I was chatting with one friend and as he was swiping on Hinge, he uttered the eternal words of how hard it is to find someone online. He’s like you are texting with someone and putting in the time and effort but more often than not, the text gets lost in translation and before you know it you’ve botched the prospect. Rinse and repeat.
He sounded a bit sad about it but then he said something contradictory. He’s like there are so many hot girls out there that I also want to make sure that I don’t miss out! That got me confused because I thought his objective was to find one girl to potentially settle down with and not a temporary sedative for his loneliness (albeit with benefits!). And that’s when it hit me that we are in this weird addictive loop where we want to find a partner but because there is excess supply of potential mates one swipe away, the FOMO is inevitable, and that is what prevents us from investing genuine effort in getting to know one person better. The app has created a divergence from the long term goal, which is to find a potential partner (I’m talking about the pre-woke pre modern love era here), but then you get on the app and you’re bombarded with potential mates and the short term reward and dopamine hit is so intense that before you know it, you have already switched lanes and Love Street is nowhere to be found.
It sounds chaotic but is also the new normal I guess. And while I am endlessly fascinated by the evolution of online dating, this swiping pump and dump reminded me of the ongoing redemption pump and dump trade. The SPAC merger date arrives and the PIPE investors redeem their shares, investors swipe right on those SPACs and load up on the commons and warrants. The flirting lasts a minute as the low float and high redemption produces a short squeeze and the stock shoots up. At that point, investors dump the stock and go back to swiping on the next one. Rinse and repeat!
The best example of that this week was the $AMHC merger with Jasper Therapeutics. The merger was approved and with 92.6% of the shares redeemed, the stock went ripping. It was up 51.8% and if twitter is to be believed, the rally is not done yet. We will find out tomorrow when it begins trading under the new ticker $JSPR.
And as I wrote last week, to study the warrant side of this play, I started tracking the warrant prices for the SPAC mergers that are waiting to be closed. Out of the 92 deals that include warrants (also including the ones where the merger vote has been approved but are waiting for the ticker change), the last week saw an average return of 9.42%. $BCYP warrants (Merger with SAB Therapeutics) were the best performing with a 53.6% weekly gain. $AGC warrants were the laggards, down 17.3% on the week.
There were 32 names that were trading below $1 at the beginning of the week. They ended the week with an average gain of 12.02% (see table below).
So call it what you want, but the pump and dump trade for mergers that are waiting to be closed is working. The prices are already recovering from their all time lows and the sentiment seems to be improving for the pre-deal names as well. And now that China has called the war on crypto (again), maybe SPAC pops will in vogue once again. A girl can dream! HA!
Have a great week and those of you who are on the apps, happy swiping!
Nikita's Substack Feed
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