The Rise Of Davey Day Trader: How A Pandemic Pivot Kept Barstool's Dave Portnoy In The Spotlight

COVID-19 brought many aspects of life to a screeching halt. Nowhere was this felt harder than the world of sports, where nearly every major professional league around the globe shut down during March 2020. Once-packed arenas were empty, players sat at home, and the sports media apparatus scrambled to find relevance in a suddenly silent landscape. Who handled this disruption the best? The gamblers, of course, and no one had a more successful rebrand than Barstool Sports's Dave Portnoy, who adopted a pandemic persona of Davey Day Trader.

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From Sports To Stocks

Portnoy founded Barstool Sports in 2004 as a small, single-author newsletter he distributed in various locations around his hometown of Boston. The newspaper eventually expanded to a blog, and by 2016, Barstool was large enough to attract the attention of private equity. The Chernin Digital Group purchased a majority stake, and Barstool's site traffic skyrocketed thanks to many colorful contributors — especially Portnoy's brash sports bro persona.

Barstool was flying high entering 2020. Millions of visitors were hitting the site, Penn Gaming Inc. (now Penn Entertainment Inc.) had just purchased a significant stake, and the betting aspect of the business was ramping up as more states began to legalize sports gambling. But as finance writer Morgan Housel often says, "Risk is what you don't see coming." And no one at Barstool (or the business world) could have predicted a global pandemic that halted all major U.S. sports leagues. The suspension of live sports was a double whammy for Portnoy. Now, not only could no one watch sports, but no one could bet on sports either, and sports betting had become a critical factor in Barstool's content strategy.

However, a different type of market still had plenty of money exchanging hands daily — the stock market. In March 2020, Portnoy adopted a new character to play in his media empire: Davey Day Trader. Despite admitting to only ever owning one stock in his life, Portnoy's new persona picked the perfect time to start a day trading operation.

‘Stocks Only Go Up'

Davey Day Trader first appeared on the scene right as the government unleashed its' COVID-19 stimulus bazooka. As money from the Federal Reserve and U.S. Treasury began to pour into the economy, major stock indices began to rally. Portnoy had inadvertently picked the absolute low of the U.S. stock market to start day trading, and his rapid success attracted plenty of attention — and subscribers.

At first, Davey Day Trader picked some stocks that were punished harshly by COVID-19, like Delta Air Lines and Carnival Cruise Line. These trades were wildly successful after the COVID-19 crash, but Portnoy soon learned some hard lessons about trading. Some of his most notable Davy Day Trader episodes included:

• Buying The Boeing Co. because he thought it was too big to fail, losing money, then shorting it later on and losing money again. He claims he lost about $2 million.

• Buying a nanocap biotech after apparently hearing about it on a date. He said he gained over $100,000.

• Picking Scrabble letters out of a hat and buying stock tickers based on the results.

While his day trading efforts are a cautionary tale (Portnoy claims he had no idea what he was doing the whole time), he was successful at keeping himself in the spotlight at a time when his primary business drivers were on an indefinite hiatus.

While Portnoy's strategies were proprietary in that no one else was using these techniques (definitely not the Scrabble thing, at least), it’s not recommended for inexperienced investors to dive unprepared into the world of day trading. However, if you have experience and want to put your skills to the test, prop trading firms like SurgeTrader offer an audition for their virtual trading programs. Traders accepted into the program get a funded account and can keep 75% to 90% of profits depending on the membership tier. Click here for more info about SurgeTrader's virtual program.

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