Last week, a 20-year-old American investor – Jake Freeman made the headlines after offloading shares valued at over $130 million in troubled US retailer – Bed Bath & Beyond.
I believe what surprised people the most was the fact that the funds initially invested – $25 million (or Naira equivalent N16.75 billion @ N670/$) had been raised from his family and friends.
Whilst it is truly remarkable to have a social network that can trust a young person with such an amount; Jake Freeman is definitely not a novice investor.
According to news reports, he bought 5 million units of the company’s shares in July 2022 at $5.5 per share using his own special vehicle – Freeman Capital Investment. He then sold his entire holding when the share price had reached $27 per unit; making $110 million in profit. I don’t believe that it was luck but that this sale was a well-timed transaction.
The fact is that the young man had been doing these kinds of deals for a while alongside his mentor who happens to be his uncle.
The uncle, Dr Scott Freeman; used to be a pharmaceutical executive and together they also own shares in a biotech company.
Apart from the mentorship he receives, he had also interned at a hedge fund and even co-authored a research paper titled “Irreducible risks of Hedging a Bond with a Default Swap” when he was just 16 years old.
Clearly, the guy took a well-calculated risk that paid off big time. Although this transaction made the headlines because of the profit earned and his age; I am certain that he would have stories of deals that didn’t end well.
For me, Jake Freeman’s windfall is proof that fortune doesn’t only favour the brave; it favours the timely, prepared and connected ones. In the words of Abraham Lincoln, “I will prepare and one day, my chance will come”.
Here’s wishing you an amazing and profitable week.