Jun 08 Intelledgement Speculative Opportunity Portfolio Report
Posted by intelledgement on Sat, 12 Jul 08
Position = symbol of the security for each position
Purchased = date position acquired (for long positions) or sold (for short positions)
Shares = number of shares long or short in the portfolio
Paid = price per share
Cost = what portfolio paid (including commission); note for short sales, the portfolio gains cash
Now = price per share as of the date of the report
Value = what it is worth as of the date of the report (# shrs multiplied by price per share plus—or minus for short positions—the value of dividends)
Change = Change since last report (not applicable for positions new since last report)
Year-to-Date = Change since 31 Dec 07
Return on Investment = on a percentage basis, the performance of this security since purchase
Compounded Annual Growth Rate = annualized ROI for this position since purchase (to help compare apples to apples)
Notes: The benchmark for the ISOP is the Greenwich Alternative Investments Global Hedge Fund Index, which historically (1988 to 2007 inclusively) provides a CAGR of around 15.1%. For comparison’s sake, we also show the NASDAQ index, which over the same time frame has yielded a CAGR of around 10.1%. Note that for the portfolio, dividends are added back into the value of the pertinent security and not included in the “cash” total (this gives a more complete picture of the ROI for dividend-paying securities). Also, the “Cost” figures include a standard $8 commission and there is a 2% rate of interest on the listed cash balance.
- 2 Jun—SLT signs agreement to acquire Asarco
- 2 Jun—WB axes CEO Ken Thompson (two years too late)
- 9 Jun—VRTX announces great phase 2 telaprevir results
- 10 Jun—BZP finally obtains permits to transport crude to Talara refinery
- 11 Jun—TMY receives bid frm Hong Kong-based group
- 12 Jun—SLT bid for Asarco gains ground against Grupo Mexico challenge
- 17 Jun—ELN announces mixed phase 2 results for anti-Alzheimer’s Disease drug
- 17 Jun—NBIX announces completion of treatments in phase 2 trial of elagolix; data due in September
- 18 Jun—SLT facing serious Grupo Mexico counteroffer for Asarco
- 24 Jun—VRTX phase 3 trials for telaprevir to focus on 48-week treatment cycle instead of 24-week cycle
- 26 Jun—BQI reserve estimates up 85%
WOW! Our best month of the year: +19%. In fact, aside from our freaky Dendreon bonanza (up 78% in March 2007), this is our best month ever. We again beat both the NASDAQ (-9%) and the Global Hedge Fund Index (-1%); overall after 18 months of operations, the ISOP is now a record high +239% compared with +10% for the hedgies and -5% for the NASDAQ.
Folks, it really isn’t this easy…or more precisely, the vaguaries of speculation being what they are, while it is feasible to be up big in a short period of time, it is just also easy to be down big. Case in point, TMY, which was up 40% this month on the buyout bid from Hong Kong—but overall is still down 68% for us. Or our biotech spec play NBIX, down another 15% this month and -60% overall in the wake of last year’s surprise recjection by the FDA of their insomnia remedy. Or GSS, our gold miner with the lingering production cost issues, down another 9% this month.
Of course, on balance, the good outweighed the bad this month. On the strength of nearly doubled reserve estimates, BQI was up 42% to lead the port, along with ELN which despite mixed results on their Alzheimer’s drug was also up 42%. The big picture for banking and housing continued to decline in June, and our short positions were strong again: WB up 35% and BZH up 20%. BZP was up 29% on the news that they were finally shipping crude and VRTX was up 17% despite somewhat disappointing news on the design of the phase 3 trials for telaprevir. SLT dropped 28% on concern they may end up overpaying for Asarco.
While there is a temptation to sell off everything and just sit on the funds for the next six months—we are up 55% YTD and it’s hard to imagine the hedgies or market catching us by December—we still think the market holds it together through the Olympics at least and the USA election most probably, and so we are holding pat here. Should we get a decline, then we will have to review the energy plays and possibly the mining and biotech plays, and we could be looking for more shorting opportunities.