If your bear case is a 10-year recovery to 40 from 20 that's a CAGR of 7.18%, about the same as the long-term average CAGR of the S&P. The difference is that the S&P doesn't have bankrupty risk, whereas airlines do [1]. So on a risk-adjusted basis, that kind of trade isn't too appealing unless you'd done significant research to show that the risk of bankruptcy or a buyout by a competitor at a reduced valuation was unlikely.
While you might have done that kind of research, the article implies (correctly, in my view) that the typical Robinhood user did not. No surprise; that sort of research is time consuming and requires significant familiarity with the industry. Yet airlines, cruise companies, and other risky assets were preferred by Robinhood users throughout the pandemic.
While you might have done that kind of research, the article implies (correctly, in my view) that the typical Robinhood user did not. No surprise; that sort of research is time consuming and requires significant familiarity with the industry. Yet airlines, cruise companies, and other risky assets were preferred by Robinhood users throughout the pandemic.
[1] https://en.wikipedia.org/wiki/List_of_airline_bankruptcies_i.... These lists omit airlines that get bought up for pennies on the dollar by competitors.