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Steve Spencer of SMB Capital Markets argues hedge fund managers are pushing stock prices up and down to get a quick return at the expense of the small...
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-- Aren't a second look at Netflix it is actually each rating up about 14%.
Today look at that 82 dollars and 61 cents up fourteen point 7% just today alone.
But before we decide to invest in the online streaming company our next guest says buyer -- -- Hedge funds may be pushing the stock price up joining us now is Steve Spencer partner at SNB capital management.
Steve you know.
Hedge funds get in these stocks as you said when the flow is very -- that basically means now a lot of people involved in it and they push him up watt.
If your performance is lagging as a hedge fund manager the only way that you're gonna stay in business is to get involved in means had a history of moving quite a bit.
Getting in their early and waiting for some type of catalyst and pushing them as quickly as an as far as you can.
And then when by the time everyone else starts getting involve -- your shares.
So they're totally preying on.
You know ignorant and Joe -- investors like me.
Well I don't want to characterize the retail investors be doing Jewish not even -- -- -- that have a pet.
I I think the important thing is just to be aware that this that this is something that's been going on at least as long as I've been involved in the markets for sixteen years.
And to be aware where which stocks its most frequently occurs in.
And to maybe beat them at their own game.
By getting involved in early in using the tools out there to get involved early ninety's like today when it runs up 1415%.
Being one of those Smart traders who is actually exiting your position.
And you -- you know.
One of the things we were just talking about is that the beauty of the web announced social media is there's a lot more tip off for the little guy now days isn't there.
Yes a great example of this is if you're if you're somebody who's following the stream -- -- stock to -- for example.
I watched over the last three or four weeks -- very experienced traders saying I'm -- at Netflix and low sixties -- the mid sixties even as recently as Tuesday people buying at 68.
Now today you see on the -- on selling a medium selling at 82 taking profits and weeding.
You know for the that -- when that the fund starts down my effort to come back down by -- Messed up shot to the -- it today people have a little bit more access to what's going on at they're still though you -- -- stock like soda streamed the did the same thing to.
And yeah hedge funds can't seem to be -- can be 500 can I so what do they do it.
Look I I think.
You know what but the staff so I think it's what three of the last four years the average fund -- -- -- -- the S and -- me.
There's a variety of factors there.
I think that the market action we've seen this year has been compounded.
I'm not only the funds but it it's more traders as well in the sense that the market -- strong.
And then it goes down it looks really we can't really thinks it's another collapse and then we rally up over the last three -- forty.
It's it's it's a really good point though to make to people that if you see -- stock -- there's got to be a rationale behind it.
Or better yet hedge fund behind -- -- what you're saying yes and the thing is they're gonna push stocks when a piece of news comes out or even something that's not really news that's just the headline.
You know a lot of people -- stop -- Netflix last month.
But that's not real piece of news but it's enough of a catalyst for them to buy a few hundred Avant shares push it up more people jump on and then -- and then -- Steve Spencer at SNB capital management -- -- us about that banks could.
