I am doubling my exposure to the rental car shorts.
music selection: “Same Old Song And Dance” — Aerosmith
Originally, I set up my rental car shorts as a paired trade, each half a normal short position at 2,500 each. Today, I am making each a full position at 5,000 each.
I sold short 125 shares of CAR at 22.40. Avis currently has 1,017 in accumulated unrealized short term capital gains. The initial trade is down 34.04%. I expect more pain in the future for this company.
I also sold short 286 shares of HTZ at 9.66. Hertz currently has 2,655 in accumulated unrealized short term capital gains. The initial trade is down 73.75%. Hertz could be going to near zero and Avis might not be too far behind.
I would also short Enterprise Rent A Car but they are privately held. Because of industry consolidation, there are no more material players left.
Devour your prey raptors!
I’m sure you’ve also looked into shorting retailers, right?
That might be next. They would probably have to be synthetic shorts because a lot of retailers are popular shorts right now, making shares hard to borrow and thus expensive to borrow. I would probably lean towards a synthetic on some of the big mall REITs.
Great calls on these two.