Performance and Example Ideas
Performance Methodology
We present performance of ideas in two ways.
First, in a “batting average” manner by measuring the Position Result itself.
Second, in a “slugging percentage” manner measuring the Portfolio Adjusted Results considering our sizing analysis since outcomes are so heavily influenced by position sizing.
We use the Kelly Criterion to include sizing considerations in our write ups.
Closed Ideas
Closed Ideas as of November 30th, 2024.
Moveable Alpha published its first idea on July 10th. As ideas are closed they will be updated here.
Total Portfolio
Below is a month-by-month overview of all Closed and Active Ideas.
As of November 30th, 2024, portfolio returns represent a 68% allocation to stocks and the remaining balance is considered zero return cash holdings.
As more ideas make it to publishing, this allocation will increase to a more realistic portfolio view.
Example Ideas
Below are a few example ideas to provide an overview of our write up method.
This may include past ideas, active ones, or both.
Published: November 25, 2024
Matterport (MTTR)
Asymmetrical Merger Break
Target Price:
$2.00 (+60% Upside)
Timeframe:
3 Months
While the FTC’s pending approval of the Matterport & CoStar merger might warrant the +13% spread currently being offered, CoStar’s +300% premium to pre-announcement pricing means there is far more downside than upside. Which, given how unaccomodating the FTC has been during the current administration, might make taking a deal break position attractive on its own.
Price at Publication: $4.85
But, an amendment filed by Matterport after Market close on November 22nd calling out gaps in internal financial reporting controls was enough to force our hands. Shorting Matterport against a capped upside and potentially long descent back to pre-merger announcement pricing makes this the kind of asymmetrical position we look for.
Published: November 5th, 2024
Sunrise (SUNN)
Spin Off / Dual Listing Potential Arbitrage
Target Price:
CHF 58.95
Timeframe:
6 to 12 Months
Upside: 23.6% at expected entry price
In typical Liberty Media fashion, a corporate action is being undertaken with more complexity than probably necessary. In this case, they are spinning off their Sunrise telecom business, which is the number two player in Switzerland.
A cumbersome ADS distribution, which is set to go OTC after nine months, may be enough friction to promote selling pressure in the early phase of post-spin trading. Should a wide enough gap between the ADS price and the look through expected value in the Swiss market develop, we will happily take the burden of converting the ADS to Swiss Exchange shares.
Note: This is one to watch, should a price develop that looks attractive per our analysis
Published: September 5th, 2024
McGrath RentCorp
Merger into Continuation Trade
Target Price:
$116.70 (14% Upside)
Continuation Portion
$119.56 (17% Upside)
Timeframe:
~2 Months
Continuation Portion
~6 Months
Price at Publication: $102.37
A merger between two modular building providers has been stuck in regulatory approval limbo for several months. With each company agreeing to a September 27th deadline not to transact, and a termination penalty date of October 31st looming, a resolution seems to be near. However, even in a deal break scenario the to-be-acquired company is sitting at an attractive valuation and the market seems to be giving zero credit to the deal taking place.