Ronchong

Yes, Greg is right. The beauty of SPACs is not just in the reward but in the risk/reward. In a market where almost every junk stock is going up, SPACs offer you similar mania return but without any of the downside. If you really want me to point something bad about SPACs, I would say it's the opportunity cost, which is a real cost in normal market condition but I don't think you are losing much in opportunities these days.

Yeap, this is the problem. The market trades at such dizzy valuation that there's not much opportunities to deploy your capital. I have been looking into the lesser touched small/micro/nano caps lately and even there, companies have doubled and tripled from their pre-covid high.

You have the mania market to thank for this. A lot of times, SPACs trade up on announcement of a merger not even the approval so you have plenty of time to sell out or redeem if things don't work out. E.g. CIIC is trading at $25 now even though the merger vote only happens in Q1 2021. The market's reception to the merger or even the rumours of an impending merger kind of give you a sense of where the SPAC would go. It's kind of a no brainer since these are relatively riskless speculative bets (as long as you don't pay too much of a premium for the SPAC units) but each one has the potential to return multiple folds of your capital. I never thought I would say this but all these speculative bets are some of the best places to park your money currently. I even sold off some of the value names in my portfolio to plow them into SPACs.

Not sure if this is of any significance but the bubble just seems to be getting bigger and bigger. Cumulative market cap of cryptos were at 700B at its peak. Now, just three companies alone, Tesla, NIO, XPEV, adds up to more than 700B market cap. Agree, having said that, I myself am invested in a few SPACS (HCAC, THCB). They don't make for good long term investments but the risk reward of these speculative bets are too good to pass on with the price floor of $10

What do you guys think about the craze over EV /renewable recently? Everything that has to do with electric/renewable has been going through the roof lately, making Warren buffet returns look like an amateur. Blink has gone up 3000% and now trade at a P/S, not P/E of 1000. Any spac that merged with an electric related company surged over a span of a few months (KCAC 110%, CIIC 150%). NIO, XPEV gained 12% and 33% on no news yesterday and both has been up at least 3 fold since the start of the year. Not to mention countless others names like PLUG, FCEL, FTEK that the market has left for dead years ago. Heck, even an ugly single seater electric car maker like SOLO has gone up four folds this year. Everyone and their family and their dogs are piling into the sector. Is this the start of the next dot com bubble?

Don't worry about investor20. He was just being sacarstic.

Great point. I don't think Buffett's action is comparable to Klarman, Millier, Ackman (or whoever you like) because Buffet is not playing in the same field as them. While both groups make Investments, one subtle difference that has not been mentioned so far is that Buffet is a businessman that does investments on the side. Berkshire is not like the rest. Berkshire is not a hedge fund but is a conglomerate that has real businesses, physical assets and thousands and thousands of employees whose livelihood depends on them. The economic loss that is going to stem from this is also real. You cant just exit or enter a business like you can with stock holdings. People gets affected. Without knowing how this is going to turn out, I don't think anyone should fault buffett for being conservative. He has a lot more considerations that a normal fund manager has.