| By Nicole Zdzieba, Assistant Managing Editor, Alpha Investor Dear American Investor, Things looked great for Nikola Corporation (Nasdaq: NKLA).
In six months, the electric truckmaker went from about $10 per share to about $79 — a gain of more than 650%!
The stock was absolutely soaring.
Fast-forward to today, and Nikola is back down to earth:  (Click here to view larger image.) So, what happened to make the stock fall so far so fast?
Look no further than Nikola’s founder, Trevor Milton.
In September, Hindenburg Research put out a report claiming that Nikola was a “fraud built on dozens of lies” constructed by Milton.
Hindenburg then detailed the many falsehoods he allegedly put into motion.
According to the report, Milton: - Misled partners into signing agreements by falsely claiming to have extensive proprietary technology.
- Staged a video called Nikola One in Motion.
- Had an artist stencil “H2” and “Zero Emission Hydrogen Electric” on the side of the Nikola One, despite it having no hydrogen capabilities whatsoever.
- Laid the groundwork to extract hundreds of millions of dollars from his company years before ever delivering on his promises.
Shortly after the report was published, Milton was pressured to resign. The stock was already on a downward spiral, and subsequently fell 50% in three months.
This is the kind of thing we're talking about when we say you need to avoid hype. People weren't buying Nikola because it was a good value, they were buying it because it was making lofty promises.
Situations like this, however unfortunate, underscore the importance of having an “Alpha Manager” at the helm of every company you invest in.
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Who’s Steering the Ship? Because, at the end of the day, the CEO is the one steering the ship — executing strategy, allocating capital and coming up with a focus for the company.
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Regards, 
Nicole Zdzieba
Assistant Managing Editor, Alpha Investor
An earlier version of this article was published in September 2020. 
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