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James Cameron Live On Red Carpet Says Avatar Sequel “3 Years Away If I Start Tomorrow” So I Shorted The Stock

March 7, 2010 at 8:01 pm
by Timothy Sykes

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UPDATE: Just as I do with my 4 newsletters and as dictated by the rules outlined in my instructional DVD packages when I am wrong about a trade, I cut losses quickly, which I did in this case…even if it is a fantasy movie stock, see what I just sent out to TIMalert subscribers (they seem to have forgiven me probly due to our outstanding week trading real stocks and racking up profits of $20,000+ for the week, $10,000 in just one day)

TIMalert: Covered My short in Avatar 2 for a small loss) You may remember I shorted my entire fantasy movie stock account nearly a weak ago on HSX.com at $241ish thinking that James Cameron’s Oscar Red Carpet comment about it being at least 3 years away would diminish expectations but the stock is gradually rising so I must admit my mistake and cut my losses…shoulda cut losses quicker but since it’s not a real stock, to tell you the truth, I forgot about it! So there are five real solid trading lessons that come with this failed trade:
1. Always good to be on the look out for opportunities, no matter where they come about
2. Opportunities are nice but you must really focus on niches you have lots of experience with
3. Cut losses quickly when price action goes against you in a big way
4. Don’t bet big unless its your bread and butter strategy (this was not a pump & dump)
5. Never forget about positions!
6. Tough to play breaking news, everyone has different expectations, better to wait and see the reaction to the new news and then play the trend, if there is any

As I just alerted TIMalert subscribers were just emailed and text messaged, I shorted the max of Avatar 2 at $241.29 with my entire HSX.com account of $9 million or so fantasy dollars

Normally you free blog readers wouldn’t get this alert within days my real-time trades, but since this is a fantasy trade with a movie stock and not a real stock, this is a good lesson for all of you to see how I pounce immediately when there is a solid risk/reward opportunity…whether that opportunity is real or fantasy dollars….this seems like a nice gimme of at least 20-30% once late comers realize what he said live on the red carpet at the Oscars.

I doubt there’s even any other movie bloggers that will get up a blog post about this so quickly, welcome to why being alert can make you a successful trader, just as my instructional DVD packages teach….just as how I made 20% shorting ZANE on Friday and my TIMalert subscribers banked nearly $20,000 because of it.

This is what I sent to TIMalert subscribers:

The stock market might not be open, but HSX.com fantasy movie stock market is and as I’m watching the Oscar’s red carpet and heard James Cameron’s interview regarding the making of Avatar 2, I had to act so I shorted my entire account. Far too aggressive for anything real, but HSX is not real and the risk is very low considering Avatar 2 is already fully priced and has been moving sideways for several months now. Considering this isn’t real $ or real stocks, I deliver this alert to you to help teach you to ALWAYS be alert and ready for opportunities…the second he said "if I were to start Avatar 2 tomorrow, it’d still be 3 years away" I immediately opened my HSX portfolio to trade off this seemingly negative breaking news (people expected it sooner, most shareholders don’t want to wait that long) and as I was about to short some, the reporter said "OK, 3 years, we’ll be looking forward to that" and James Cameron quickly corrected her saying "that’s not what I said" which means it ain’t happening tomorrow so the movie will be longer than 3 years away, if at all…James’ being so quick to correct the reporter makes me very suspicious, this could be a 5 year wait…I’ll try to hold this a few days/weeks with the goal of covering under $200/share…PennyStocking Silver subscribers, sorry for no IM alerts on this trade, no matter that its fantasy, but the IM software doesn’t work outside of market hours

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Posted in Analogies, Celebrities

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  1. James Cameron Live On Red Carpet Says Avatar Sequel "3 Years Away If I Start Tomorrow" So I Shorted The Stock
  • Jimbo

    IMAX is being supported by Alice in Wonderland which did about $120 million in receipts opening week. There is also a stream of new 3D movies coming out this spring. Should hit new 52 week highs near term but wtfdik you’re the expert.

  • Aaron

    I have a question- although this was a great example of using trading concepts outside of the actual securities markets, it brings up something I have been wondering. In this example, your trading rationale seems to have followed this general structure:

    1. Avatar “stock” was being bid up beyond its revenue potential, due to speculation that a sequel will increase its revenues. That is, the then-current price represented the value of Avatar I + Avatar II speculation.

    2. Most market participants believed that Avatar II will be released in a timely manner.

    3. Cameron’s announcement was a “total surprise” to the general market community. That is, the news that Avatar II was at least three years away was not properly priced into the stock.

    4. Therefore, the first market participants (those watching the Oscars with access to a trading terminal) to short the stock will likely capture the panic down from Avatar-II-speculative-heights.

    My question is simple. How do you know that the majority of shareholders didn’t know that Cameron wasn’t planning on a three-year delay?

    This is the essential question of trading based on news. The looming question is always whether or not you are REALLY the first to find out the news. Or, at least, if you are the first among the majority of shareholders to find out the news (allowing for a minority of insiders to know news beforehand but not have enough buying power to influence the market price significantly).

    How do you know that a significant Avatar shareholder population didn’t already know that Cameron was planning on a delay?

    This is a great example for education, especially because no money is at risk. Thanks for your reply Tim!

  • http://www.timothysykes.com Anonymous

    just gotta read message boards and news to find out expectations…in the real world i would never trade such unpredictability, on hsx.com, its a good bet…the lesson was just to be prepared at all times

  • Aaron

    OK. Thank you for the post! I only ask because sometimes I wonder if the message boards and news headlines really capture the sentiment of a stock’s majority shareholders. For example, if institutional ownership is the vast majority of the stock (and presumably institutions aren’t very active on message boards), then message boards would be a tough place to find out what the real, majority shareholder sentiment is. You would have to ask the institutions why they’re buying- and they might be buying because of proprietary M&A research, or a unique warrant situation, or to offset risk in a derivative, etc.

    I also know, from past experience, that the reason for a runup or crash sometimes turns out to be something I didn’t expect- even when I have premium news services and the informed opinions of successful traders. “Oh, well, I guess no one cares that they just got an FDA rejection… apparently something about the tone of the CEO’s voice is responsible for this five point rally?” (or similar bizarre happenings). But like you say, you just have to make an educated guess and maintain the risk. Thanks again.

  • Heor Analingus

    I find your use of the work ‘instructional’ constantly, sort of, how can I say it, gay?

    Are you and that bearded guy Reaper more than just friends?

  • http://www.timothysykes.com Anonymous

    who cares what u think, u’re a troll…go start a blog, trade lot, overtake me as the #1 ranked trader out of 45,000+ on covestor, teach thousands of people every inch of your proven successful strategy, get dozens of daily testimonials then come back and comment, until then go back to your cubicle

  • Anonymous

    you forgot to add how much money you make through the blog ;-)

    Some ppl have nothing better to do than post stupid shit… A great quote i found from a certain pumper site..

    “some people dream about doing things while others stay awake and do them”

  • http://meatspin.com/ Heor Analingus

    by #1 ranked, don’t you mean #10 ranked?

  • http://www.timothysykes.com Anonymous