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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: Hello Peter & 5i team,
I'm quite frustrated at the way the market reacts to a Citron report whose motivation is quite questionable; is it not possible that their report is so designed as to support their objective of shorting the stock?
Supposing their report is misleading, how is it possible that they can get away with it with impunity?
Now that the QSC starts investigating Valeant, who is investigating Citron?
Regards,
Antoine
Read Answer Asked by Antoine on October 22, 2015
Q: I am not a holder of Valeant Pharma, but I do have a small position in Concordia. While one could argue that Valeant had appreciated quite spectacularly after its failed bid for Allergan and was perhaps due for a pullback that recent market behavior seems irrational! It seems that retail investors don't really have a chance in today's markets with HFT and powerful short sellers. Many retail investors will get scared out of these stocks and others when huge declines occur even if they bounce back in 3 weeks or 3 months as evidenced by what happened on that Monday in August. Is there something the market watchers can do to restore some semblance of fair play in the stocks markets?
Read Answer Asked by Jason on October 21, 2015
Q: Hi, Valeant's share price took huge hit over past two weeks, after Hilary Clinton comments and Democrats' request for a subpoena for drug pricing. There are two drugs in question, where price increases were 225% and 550% appx. As per analysts covering the stock, even if price of these two drugs is reversed, it should impact the share price by about $8-$9. Except one major brokerage, no one has changed rating of the stock (Most have Buys). Although a few have adjusted price targets between $10-$15 but average is still about CAD$325. Last week stock traded as low as $204.50 and has now stabilized in $230-$240 range. Only a few weeks ago it traded as high as $347. Despite the near term headline risk (although it is not known if house committee will even accept the democrats request for a subpoena and US history of very limited success with drugs price control), is it reasonable to accumulate shares at these levels, in your view? Valeant still appears to be the only choice in large cap pharma sector in Canada (of course Concordia being the other)and I am wondering if there is an opportunity here. Thanks, as always for your valued comments.
Read Answer Asked by rajeev on October 05, 2015
Q: Hi- just thought my fellow subscribers who own Valeant might be interested in this article, which, in brief, states that Valeant is one of the greatest increasers of drug prices and may be affected by the Hilary Clinton furor.
http://www.zerohedge.com/news/2015-10-04/more-pain-biotechs-ahead-valeants-astronomical-price-increases-take-center-stage-pfi
Read Answer Asked by Pat on October 05, 2015
Q: Hi,

Thanks for suggestion that VRX would be a good candidate for a covered call. I bought 100 shares around $270 in early May and wrote a July $300 call for about $1,500. (Un)fortunately, the stock rose quite a lot so now option is in money. Any suggestions what to do? (i.e., do you like VRX enough to suggest I should buy option at a loss so my position isn't exercised?). Thanks for great service!
Read Answer Asked by Steven on May 29, 2015
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