The AuMake International Limited (ASX: AU8) share price may have had an incredible start to life on the Australian share market on Thursday of last week, but unfortunately it has been nothing but red since then.
The shares of the Australian-owned retail company which connects Australian suppliers directly with daigou and Chinese tourists came crashing down to earth with a bang today.
Its shares finished the day almost 26% lower at 14.5 cents.
This means that since AuMake's 194% gain to 23.5 cents on Thursday they have lost 38% of their value.
With no news out of the company, today's decline is likely to be the result of profit taking from traders speculating that the run higher is over.
This should come as little surprise to many investors. As I pointed out last week, that first day gain meant that AuMake had a market cap of approximately $69 million.
Which is reasonably steep given that in FY 2017 the company generated sales of $10.3 million.
Overall, whilst I think the company could have promise, it is simply far too early to risk an investment.
Investors looking for a high risk and potentially high reward investment might want to consider Bubs Australia Ltd (ASX: BUB). Its shares have fallen to a value which I believe to be reasonable given its strong growth potential in the lucrative Chinese infant formula market.
