I woke up to this text message yesterday.

It was completely unsolicited and I have no idea what the source of it is. Could it be a potential pump and dump given the current market circumstances? Maybe… so I decided to dig a little into this company. It looks like it spiked a few years back and has been basically worthless for the last 3 years.

What’s interesting is it looks like it is being pumped again recently. Here is the last 2 years.

Zooming in closer it looks like there has been a massive amount of volume increase in the last 3 days. Hence my text message perhaps?

What about Google Trends did people recently just start searching for ULTH or ULTHF?

I wonder what reddit has to say.

Financials

Finally, I wonder what their financials look like? Would I be comfortable holding this short position?

Let’s keep in mind this company has a market cap of $42m

But..

Only $80k in cash.

$7,500 in accounts receivable

$92k in assets

$323k in liabilities

-$5,032,200 in retaind earnings

But Lithium is rare and the price is about to explode!

So let’s take a look at LIT which is an ETF that holds a bunch of Lithium related stocks. https://www.globalxetfs.com/funds/lit/

As you can see from their holdings ULTHF is not listed. This adds further evidence this stock should be shorted. In fact, if you wanted to take a more market neutral approach to this trade you could go long an equal-weighted amount of LIT.

Time to get short

Seems like more pump and dump hype. I’m definitely going short.

I tried to get short on 2/24 @ 1.40 but my broker didn’t have any shares available.

So I got an email this morning…

I was able to open a position this morning short @ 1.15. It has fallen already so I’m opening another short position @ 1.01. This trade would already be up 40% if it wasn’t rejected yesterday.

Last year I was looking to up my precious metal holdings. I like to keep 10% of my net worth in gold and 1% in silver. I bumped my gold holdings to 20% given the Coronavirus outbreak amongst other reasons outlined below. However, when I went to go and purchase silver from APMEX. I noticed the cheapest bullion I could get was something like 10-20% over spot price So I switched to long-dated options instead. I landed on a few. But eventually piled in on one a strike price of 30 with an expiration of January 21st, 2022. I bought these for $1.15 at the time. Looks like I actually picked the worst out of the four that I bought. No worries though I’m not complaining at a 192.68% increase.

The reason for my trade were as follows:

Physical silver was trading way over spot price at APMEX

The gold to silver ratio was the highest it has ever been in the last 100-years.

When governments get in trouble they just inflate your money away. It has been this way since the beginning of time.

The federal reserve rate was basically dropped to 0% indicating massive problems.

Silver is the “poor man’s gold” as Covid struck harder I assumed it would rally on the Fed’s printing press which was sure to accelerate and the Fed’s balance sheet had spike massively.

The fed now owns 1/3 of all mortgage-backed securities. They are literally bailing out every asset class at risk of jeopardizing the future of the sovereign credit.

Update:

It has been rumored that online bullion sites have ran out of silver until the markets open tomorrow and Wall Street Bets may have their sites set on SLV as their next target. I’m not so sure they can pump silver up 1,600% like they did with GME but it will be interesting to see what can be done. Supply of silver is already very low after the markets closed Friday. Here is a quote from WSB, “Corner the market. GV thinks its possible to squeeze $SLV, FUCK AFTER SEEING $AG AND $GME EVEN I THINK WE CAN DO IT. BUY $SLV GO ALL IN TH GAINZ WILL BE UNLIMITED. DEMAND PHYSICAL IF YOU CAN. FUCK THE BANKS.”

I just put in a big order for SLV options 30.5 strike expiring 2/5/21. My issue is the market is closed. I put in the order at .23 limit and I’m not sure if it will get filled. Regardless I’m still holding a bunch of futures from my previous trade. Future markets are already showing a large breakout.

Here is a message from the CEO of APMEX:

I’ll let TheHappyHawaiian explain:

The real DD on SLV, the worlds biggest short squeeze is possible and we can make history
byu/TheHappyHawaiian inwallstreetbets

Here is his updated post:

The DD on SLV – Updated 1/31 – clarity on what to buy
byu/TheHappyHawaiian inwallstreetbets