February is considered a relatively volatile yet unpredictable month for the stock market. One of the main reasons is the annual tax-loss harvesting season, which might cause increased selling pressure as investors look to offset gains in their portfolios. Here we will examine the risks associated with investing in the stock market in February and navigate between the volatility and uncertainty of this often unpredictable month.
So, are you ready for February’s highlights? Who got issued? Who withdrawn? How did your favorite company do? Here’s everything:
The Ins The Outs
About 17 companies were issued to NASDAQ this February, the most dominant one is NEXTracker Inc. (NXT) with a $638.4M offer amount and a $24 share price. NXT is a leading provider of intelligent, integrated solar tracker and software solutions used in utility-scale and ground-mounted distributed generation solar projects around the world.
Merely, 5 companies withdrew from NASDAQ this month, the lowest withdrawal number since 2021. The first to withdraw was Oaktree Acquisition Corp. III on Feb 6, and the last was Ocean Biomedical Holdings, Inc. on the 16th.
Read All About It
The machine
This month we targeted two major events: the battle for sustainable, valuable AI, and the effects of the dozens of thousands of layoffs by a few dominant companies in the market.
One of the growing fields in the past few months is AI start-ups. As chatGPT was introduced by OpenAI every major player started to put their AI side projects in overdrive and many new startups joined the ride. NASDAQE and ZACKS released an opinion article discussing what companies you should buy shares of in order to join the hype >> Read Article
The controversial stock of the month is none other than Alphabet’s GOOGL. The stock dropped in correlation to the failed AI presentation. So although many advisers, such as TechCrunch describes Google as “losing control” in the AI field as long due to bad strategic choices, others like CNBC remind us that Alphabet is still the undisputed champion when it comes to search engines and that they could and probably would win the AI marathon — that some mistaken for a sprint.
The human capital
Now, after the smoke clears, more and more articles and research studies show, that although Alphabet, Meta, Amazon, Microsoft, and Salesforce had major layoffs in the past few months from a great, retro perspective, they are still showing enormous growth in the past 5 years. This article by INSIDER describes the trend >> Read Article
Focusing on Alphabet as an example, they fired 12,000 people, some working there for over a decade. That being said, we see that in the past 5 years, Alphabet’s growth was tremendous. By scooping up the numbers it is hard to understand what went through their mind and one cannot wonder if this was by an overgrowth mistake or a calculated event.
If this is not enough, the beginning of 2023 shows an ongoing decrease in unemployment rates in the US (as this graph describes). A report by the US Department of Commerce claims that this unemployment rate is the lowest it has been in the past 54 years >> Read Report. This raises more questions than it should, like where did all the high-tech employees that were fired? Are they taking a time off and not enlisting as unemployed or did they find a job this quickly?
Final note
February’s two most dominant events were a true battle of both man and machine. Emphasizing the new trend of AI advancement and research next to the huge layoffs and the way they were handled. It is yet to be determined how the layoffs will affect the market and if this AI revolution is merely a passing trend or is here to stay and evolve exponentially in the next few years.
From an investor point of view, this is a great time to decide if to join the hype, strong companies are yet to succeed and the significant players might not stay as time goes by. Getting better acquainted with this field and deciding where you should invest might be smarter and more profitable for the adventurer investor.
Stay updated and read more about everything trendy in the ESOP & financial world in our blog.
About altshare
altshare is a leading, fast-growing Equity Management & Compensation Plans Administration solutions provider. We love challenges. We are obsessed with our clients. We are on a mission to redefine the way founders do equity. All our products & services are supported through the altshare platform — the only equity management platform built for entrepreneurs.
