Bullpen.News From Edwin Dorsey
Get Daily Recap Feedback

Wednesday, October 28, 2026

Back to today

From X

@orrdavid

David Orr on X

Another thing: This post is *not* meant to call a short term top. I sometimes want to. Maybe even I have hinted that's what I think. But that's wrong. The best way to think is, "I don't know when the top will be, maybe $SOXX really does take another 100% leg up first, who knows, why not." But that next big move up or down seems like a pure guess to me. So at least for making a binary bet - a bet on $SOXX beta - it's a pure casino. There probably is some brilliant way to structure this trade, though. You're long compute and you're short the things that more intelligence kills - like really kills, not that benefits from AI letting them cut 90% of their staff. For my part, there are just way too many eyes on the trade for me to be all that interested, though. Because if too many smart people figure out how to solve that fundamentally guess what ... the long/short could easily blow up in a month, just before the collapse, since the market won't often give such large crowds a free lunch pair trade. I say screw all of that, better to just focus on real investments, in the real world, that likely benefit from AI or at least don't get hurt. That is not a gamble today, and lots of those stocks are just straight up cheap. The only downside is that the AI trade will probably keep the stocks trading weak ... but this side is NOT hard to do broad, uncrowded pair trades on, so who cares.
@orrdavid

David Orr on X

Look at this last chart carefully. April implied that the next few months would get more expensive, and they did. July implied that the next couple of months would get more expensive, and it was wrong. And AI traded sideways. September again implied that October would go up, and October indeed went up a lot! And $SOXX tried to rally hard,m and then failed hard, even though October's curve suggests prices are still going up over the next month or two? It's hard to say exactly. What I am confident amount: Once the more modern compute starts going down rather than up, the AI trade will have already imploded many months beforehand.

Investor Letters

All letters

The Data Center Bridge

Small- and mid-cap data center stocks trade as one despite sharply different funding bridges: 12 of 15 cover fixed costs on signed…

IREN $9.9BFRMI $1.9B
CV's Substack 16 clicks

Molina & Kinsale

Molina Healthcare and Kinsale Capital’s earnings are reassessed through a long-term lens, emphasizing conviction and detachment during…

KNSL $8.3B
Bearstone 8 clicks
LWAY · long

Lifeway Foods INC

Lifeway Foods holds 95% market share in kefir, is growing 20% to 35%, and trades at 12 times projected 2027 earnings as its capex cycle…

LWAY $337M
Value Investors Club

A Mexican Blue Chip Bargain

Grupo Herdez, a MXN 15.2 billion Mexican food company, pairs dominant grocery brands with McCormick, Barilla and Hormel joint ventures.

GUZOF $962M
Exploring with Alluvial Capital

Sarepta Risk and the FDA

Sarepta’s Exondys 51 approval despite a 12-patient trial frames FDA regulatory risk and a call to remove Commissioner Robert Califf.

SRPT $1.9B
John Hempton's Newsletter 1 click

Publications we follow

Every publication on this site, hand-picked.

129 publications

Newsletters 109

YouTube 4

Blogs 15

Seeking Alpha 69 of 270

Nominate a publication

X accounts we follow

Every account on this site, hand-picked.

91 accounts
Nominate an account

Investor letters we follow

190 firms

Sectors

Ordered by how often our editor reaches for them.