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Trade of the Day: Long or Short Tech and Mineral Companies Ahead of Extraterrestrial Biological Entity Contact?

At half past noon today,NASA is scheduled to hold a press conference to discuss the discovery of “an exceptional object in our cosmic neighborhood.”

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Antonio M. Rosario | Iconica | Getty Images

Now that object is likely just an inanimate thingy hurtling through space. But what if it is something else entirely—a spacecraft containing extraterrestrial biological entities. You know, aliens.

What’s the trade on First Contact with aliens? My initial thoughts turn on two subjects—tech companies and minerals.

Let’s start with tech. It seems likely that any extraterrestrial biological entities—EBEs, for short—capable of reaching the earth would be technologically far more advanced than us. This could undermine existing tech giants that depend on trademarked technology to generate profits. Their tech could rapidly become outdated once EBE tech is introduced. So, we guess, short big tech in case of First Contact.

On the other hand, an agile and quick-acting tech company could be positioned to see big gains from copying and producing alien tech. Is there a company in the market capable of doing this?

When I asked some friends about this, quite a few said Apple might be the best bet. I’m not so sure. Apple is built around the visions of Steve Jobs and his team. I’m not sure that they would adapt quickly to technology very different from the kind they are used to employing.

As for minerals, it’s also hard to know how to play First Contact. If aliens are coming to acquire minerals—which seems likely, since the acquisitions of minerals has been the driving force behind a lot of human exploration—this could be a boon to mineral companies. But which ones? It seems unlikely that they’d be oil based. Perhaps uranium miners? But what if, somehow, silver turns out to be the key to cold fusion and that’s what the aliens would be after.

More importantly, what if instead of peacefully acquiring the minerals, the EBEs intend to just take it from us. In that case, shorting mineral companies might be a wise move.

What’s the point of all this? It’s to show that the consequences of big events are unpredictable. Even when the most important fact is known—EBE First Contact—there are too many unpredictable factors to make for a reliably profitable trade. We have to speculate.

Well, that’s kind of the point. I also just felt like talking about investing in an alien arrival.

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