July 29, 2021 Sign Up

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"If you’re offered a seat on a rocket ship, don’t ask what seat! Just get on." — Sheryl Sandberg

Good morning! Language learning app, Duolingo went public yesterday and its stock soared 36% from its IPO price giving it a valuation of $6.5 billion. US Gymnastics star, Simone Biles completely withdrew from the Olympics and will not defend any of her medals on mental health concerns. In virus news, President Biden will require federal workers to get the vaccine or submit to testing.

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1. Story of the Day: Robinhood's Big Day

Notorious trading app, Robinhood finally goes public today. Wharton professor David Erickson has called it the "the most concerning high profile IPO since WeWork tried to go public a few years ago." Reasons include Robinhood's murky business model and trading policies, trading outages and shutting off buying of meme stocks in the GameStop trading mania earlier this year.

Robinhood will trade on the Nasdaq under the ticker HOOD, at an expected price of $38-42 and is looking to sell 55 million shares to raise as much as $2.3 billion. At the top end of the range, Robinhood would be valued at $35 billion and the cofounders will have stakes worth $2.8 billion each.

Robinhood is the third-largest brokerage based on number of funded accounts, behind Fidelity and Charles Schwab with its 22.5 million trading accounts. The IPO implies a ~$1,350 valuation per account, lower than peers (all over $2,000) due to mostly retail trading audience.

Robinhood is also reserving 20-35% of its IPO shares for its own clients, one of the largest retail allocations ever. Typically retail traders cannot get hands on IPO shares till they start trading so they miss out on the pop.

Short Squeez Takeaway: Robinhood might kick-off to volatile trading since many retail traders hold the stock and because of the company's loose lock-up restrictions (employees can sell 15% of their shares immediately compared to the 6-month lock period typically). Robinhood also doesn't have good precedent from IPOs that raised more than $2 billion this year – all six prior ones are trading below their IPO prices...

2. Markets Rundown

• Nasdaq ended solidly higher but the broader market closed weaker as the Fed signaled that the countdown has begun on scaling back its massive support for the US economy

Movers & Shakers

• (+) Tilray ($TLRY) +26% after the company posted a surprise profit for its fiscal fourth quarter.
• (+) I-Mab ($IMAB) +22% after its application for mid-stage Efineptakin cancer trial was accepted by China.
• (–) Cheesecake Factory ($CAKE) -13% after good earnings numbers weren't enough, following a big change in mask-wearing guidance.
  

3. Top Reads

A Message from Polymarket: Kanye’s DONDA Album

Following a sold-out listening party last Thursday in Atlanta, Kanye West’s upcoming album DONDA is receiving attention and hype from all around the world. Originally slated to release at midnight on July 22nd, the album is still yet to be released. Kanye is currently camping out at the Mercedes Benz Stadium, and videos of 2 Chainz and Playboi Carti have circulated showing them putting final touches to their tracks. Complex has confirmed reports that the new release date is set to be August 6th.

Will Kanye West’s album DONDA be released by August 7, 2021?

Traders are currently pricing in a 57% probability that DONDA will be released on August 6th. Can Kanye and his team finish the remaining parts of the album, or should we be expecting another two week delay? 

Use code “OWS” to get your first trade reimbursed up to $100!

4. Book of the Day: The Art of Stopping Time: Practical Mindfulness for Busy People

We’re all struggling to find time in our lives, but somehow there’s never enough to go around. We’re too tired to think, too wired to focus, less efficient than we want to be.

New York Times bestselling author (Pedram Shojai) guides us towards success with what he calls Time Prosperity - having the time to accomplish what you want in life without feeling compressed, stressed, overburdened or hurried.

So how do we achieve this Time Prosperity? We learn to Stop Time. To do that, Shojai walks us through a 100-day Gong, which is based on the Chinese practice of designating an amount of time each day to perform a specific task.

You’ll learn how to use Gongs to reprogram your habits, reduce stress, increase energy, exercise the ancient practice of mindfulness and become a master of your time.

5. Daily Visual: Athletes Chasing Huge Gold Medal Bonuses (estimated bonus per gold medal at the Tokyo Olympics)

Source: Statista

6.  Daily Acumen: No Man is a Prophet in His Own Country

“No man is a prophet in his own country.” It means everyone’s human, everyone’s flawed, nobody knows everything. So it’s easiest to convince people that you’re special if they don’t know you well enough to see all the ways you’re not.

Everyone is trying to craft an image of who they are. The image helps them sell themselves to others. Skills are advertised, flaws are hidden. Instagram is full of beach vacation photos, not flight delay photos. Resumes highlight career wins but are silent on doubt and worry. Investing gurus are easy to elevate to mythical status because you don’t know them well enough to witness times when their decision-making process was ordinary, if not awful.

When you are aware of your own struggles but blind to others’, it’s easy to assume you’re missing some skill or secret that others have. The more we describe successful people as having guru-like powers, the more everyone else looks at them and says, “I could never do that.”

That’s unfortunate, because more people would be willing to try if they knew that those they admire are just normal people who played the odds right. Everyone’s dealing with problems they don’t advertise, at least until you get to know them well.

Source: Collaborative Fund

7. Memes of the Day

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