It was thanksgiving yesterday here in Canada, and I know what I’m thankful for - profitable companies that have a solid business model and are actually “disruptive”. But hey, all good things come to an end - and the lock-up period is one of them. During the book-running process of an IPO, early-stage investors or insiders often have to sign a lock-up period - an amount of time before which they cannot sell their shares in the company. This is largely done to prevent too many shares from entering the public markets too soon. 

Let’s say you are an insider who believed in Beyond Meat’s vision to save the planet (?) or create plant-based meat. You funded the company with your own money, and now own 10% of it. Let’s also add that you bought those shares at $30 per share. Without a lock-up, you could’ve ridden the hype wave and sold all your shares at $220 something dollars locking in a hefty profit. But this would create excess supply in the markets and would flood the market with way too many shares than are necessary, which would drive the price down for others. 

Anyway, the lockup for Pinterest ($PINS) and Zoom Technologies ($ZS) ended today, and shares slipped for both during the trading day. Pinterest closed at $25.57 today, while Zoom closed at $71.11. It would be a good idea to keep an eye out to see what happens in the coming days. 

Trading Zoom

One more thing - I personally like Zoom, but I do think that the company is currently overvalued. I’m currently invested in a put option that expires this Friday for Zoom technologies with a strike price of $67.5. If I’m being honest, today’s slight uptick has already cost me, but I’m going to wait this out. Needless to say, this is not investment advice, but I do think it can be interesting if I take a position on something each week and talk about why I took it in detail and evaluate its performance. If some of you might like to see it, reply to this email and let me know and we can make this a regular section!