Hey, its me again, shitty miata guy. I've been eyeing this trade for a while and now ready to share the DD I've put together. Today, we’re going deep into Opendoor, so learn to read or skip to the pictures.
OPEN has a new CEO from Shopify that reads the bible every day, is an AI maximalist, and receives a $1 salary. The business has excellent new products and plans, improving fundamentals, and real upcoming catalysts. Attention will be drawn from OPENAI, creating potential meme-driven spillover price action. After that, OPEN will continue to cruise upward with solid technicals and catalysts unfolding over the summer and into the fall.
Upcoming catalysts are:
- The Levenshtein distance aka the typo trade
- Upcoming Russell 3000 inclusion creating mechanical buying and portfolio restructuring
- Insider buying and incentive-based, shareholder-aligned compensation + $1 salary for new, self-proclaimed "AI-maximimalist" CEO
- AI-driven product rollout and company "re-founding"
- Positive Q1 results and looking forward to Q2
- Mortgage rate cut speculation as Trump takes over the Fed
- Dealer positioning and 2nd/3rd order Greeks
- High short-interest around 13% of the float
https://preview.redd.it/rbpnirqzcv4h1.png?width=1600&format=png&auto=webp&s=1bb2cd087ade5b4d04cc64ed81e757c6c60b92cb
OPEN catalyst timeline: old typo/meme rockets, prior OPEN explosions, and the 2026 Russell/OpenAI runway.
Historical examples of Levenshtein distance typo trades, AKA the science of regardation:
There are multiple instances where this trade has played and paid out in recent history.
- Tweeter was a bankrupt electronics retailer with the ticker TWTRQ. Twitter was going public under TWTR. Tweeter ripped anyway.
- Wrong Zoom, ticker ZOOM, got chased during Zoom Video mania.
- Elon tweeted "Use Signal" and traders bought Signal Advance, which was not the Signal app. That one went completely feral.
This phenomenon relates to something called the Levenshtein distance. Essentially, it examines how many one letter edits it takes to turn one word into another. Don’t let the equation scare you, it’s quite simple.
https://preview.redd.it/y5zs2b72dv4h1.png?width=3800&format=png&auto=webp&s=6e619eb94ced417840b3f9e56a0d4c161ae21984
Levenshtein distance equation: OPEN vs OPENAI
TWTR to TWTRQ is distance 1: add a Q. ZM to ZOOM is distance 2: add two O's.
They are ticker-neighbors sitting close enough that humans, autocomplete, media headlines, and trading screens can shove attention into the wrong bucket. Sometimes the markets are dumb in a very trade-able way and something irrelevant to the news cycle can catch a bid.
That doesn’t mean every person buying OPEN thinks it is OPENAI (that’s regarded), but the similarity reduces trade friction, gets OPEN into more searches and onto more screens. We don't know exactly which ticker they will go with, but go see what happens in your Schwab account when you start typing open...
OPEN is the next typo trade with even greater potential than what we are currently witnessing. The market is showing us what happens when retail wants a private company it does not know how to buy. If you were late to the outer-space party, it’s OK because I think OPEN is another similar setup and it is worth buying on its own merits.
https://preview.redd.it/c0kvzfx3dv4h1.png?width=1382&format=png&auto=webp&s=700cee78fac2f705291a1c8f0dd751e8871698a5
OpenAI IPO headline cycle is live.
https://preview.redd.it/qi78czm6dv4h1.png?width=1672&format=png&auto=webp&s=f3634a809cc4902b2ee88ac0289ac9d0d9e37d44
Charlie gets it.
OPEN is more than a normal typo trade:
Opendoor announced Russell 3000 inclusion on May 27. Effective after the close on June 26. This means mechanical buying and mechanical restructuring have a time-frame. The forced, price-agnostic mechanical buying resulting from the Russell 3000 inclusion on June 26 will provide bid support throughout the entire month of June. Pretty straight