Ginkgo Bioworks Stock Just Got a Whole Lot Riskier

One thing you learn in risk management class is that risk can be defined as the volatility of returns. It’s a way of not thinking about up or down, but rather the stability of a stock price. From that you can infer that stable stock prices are more desirable. So, when volatility gets introduced to a stock, it becomes less desirable.

We admitted to having a crush on synthetic biology darling Ginkgo Bioworks (DNA). Even though it was a special purpose acquisition company (SPAC), we still loved it so much we broke our own rules and made “a small bet” earlier this year.

So, it was with a great deal of reluctance – and at the same time lots of joy – that we bought shares in Ginkgo several minutes after reading their deck. The story was everything we imagined it would be and more. 

Credit: Nanalyze

We tell people over and over not to invest in stories, yet that’s what we did. At that time, we had no simple valuation ratio rule to keep us from buying a stock whose ratio was sitting at 100 at the time. (Ginkgo’s current simple valuation ratio sits at 125.)

Another mistake we made was investing in a SPAC before the merger had completed. We