It’s no surprise that when it comes to investing, larger players can have some advantages. One advantage smaller investors have, however, is the ability to see what the big players are doing and follow along. In a bear market, they may even get a better deal.
By following investors with a strong track record, it’s possible to beat the market over time. And to do so with less volatility than other market strategies.
One move investors can make now is to follow a $1 billion investment by Saudi Arabia’s sovereign wealth fun into Lucid Group (LCID). The manufacturer of electric cars is about to launch in Europe. However, shares are at an all-time low since going public in July 2021.
The EV manufacturer now has a staggering 83 percent drop over the last year. Despite that, and the company’s losses, it’s starting to see sales, unlike some other EV companies that have gone public recently.
Revenues have soared 84,149 percent over the past year. That number will slow, even with the European market open for business. But shares are still trading at 6 times some very rapidly-growing earnings.
Action to take: Investors may like a speculative position in shares here. With a $10 billion market cap, it’s going for a fraction compared to other automakers, and just ahead of a big surge in growth.
For traders, a long-dated call like the August 2023 $10 call looks attractive here. That option recently traded for about $0.75. It could be a big winner on a move higher in shares in the next 8 months.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.