Thursday, February 01, 2018

January 2018 Performance

I can’t believe January has already come and gone… The market strength just amazes me with the S&P 500 gaining ~ 5.5% just in January. My return for January was much more muted with a gain of 2.8%. I continue to have a high cash position of ~ 14% as I remain cautious in this market environment. I just sense that there’s too much optimism out there. In any case, I’m comfortable with my current cash position and will deploy when opportunities arise.

It’s definitely been a busy with all of the M&A activity in the recent weeks. I initiated positions in several arb plays (via Short Puts): Buffalo Wild Wings (Ticker: BWLD), Ignyta (Ticker: RXDX), Bioverativ (Ticker: BIVV) and Juno Therapeutics (Ticker: JUNO). Buffalo Wild Wings and Ignyta are expected to close next week. Bioverativ and Juno Therapeutics should both close by the end of Q1. I really like the risk / reward on both Bioverativ & Juno Therapeutics and have large positions in both.  Bioverativ and Juno Therapeutics are both structured as tender offers, which should lead to a quick close as long as there are no hiccups.

That’s it, just looking forward in seeing Buffalo Wild Wings and Ignyta close next week…


2018 Performance = +2.80% with the running monthly returns as follows:

January +2.80%

13 Comments:

At February 02, 2018, Anonymous mergerpie said...

same with BIVV and JUNO. I also added abit of March AKRX. Major position in MON.

 
At February 03, 2018, Anonymous Anonymous said...

Hi MT,
Did u sell any of your core investments? Hopefully big drop last Friday doesn’t continue into last week.
Thanks

 
At February 04, 2018, Blogger Money Turtle said...

No, I did not sell any core positions in the down draft.

 
At February 16, 2018, Anonymous Anonymous said...

any jitters out there on JUNO and BIVV? spread is wide considering HSR expiry in 2/20 and 2/22 respectively.
thanks

 
At February 16, 2018, Blogger Money Turtle said...

JUNO: On 2/14, KEI (Knowledge Ecology International) met with the FTC to express their opposition to Celgene’s proposed acquisition of Juno Therapeutics. They're concerned that Celgene will own the Cart T treatment for multiple myeloma from Juno and Bluebird Bio. This is a non profit organization. They're upset that the Cart T technology was originally funded by the NIH and now Celgene is going to control Cart T for this indication. They were also upset with Gilead's acquisition of Kite's Cart T product. Their agenda is suspect...

JUNO / CELG HSR expires 2/20 so there will be a SEC filing on 2/21 regarding the outcome.

I believe the widening spread from Juno is related to the KEI piece floating around. I just can't see how the anti trust authorities will have any issues with this transaction. All of Juno's products are in early clinical trials with the exception of their Cart T, which is in phase 2. There's no guarantee that any of their products will ever make it to market. Cart T space is highly competitive with Novartis and Gilead having FDA approved Cart T products. Other companies (such as JNJ) are also developing products based on Cart T.

BIVV appears to be acting fine...

 
At February 16, 2018, Blogger Money Turtle said...

BIVV: Also require anti trust approvals from Sweden and Japan. Sweden decision is expected on 2/28 and Japan ???

 
At February 17, 2018, Anonymous Anonymous said...

Thanks for the info.

 
At February 17, 2018, Anonymous Anonymous said...

Do you reinvest your dividends? I was reading somewhere the pro and cons and one user pointed out that Mr.Buffett doesn't do it for all his holdings. Just wanted some advice Thanks

 
At February 17, 2018, Blogger Money Turtle said...

Yes, I reinvest dividends for my long term holdings. Reinvesting dividends helps with compounding your returns over time.

 
At February 20, 2018, Anonymous Anonymous said...

It looks like Rite Aid is on the table again

 
At February 20, 2018, Blogger Money Turtle said...

I'm not touching RAD again... I don't like the structure of this deal.

 
At February 20, 2018, Anonymous mergerpie said...

I divested all of BIVV and JUNO last week.. not related to the deals but just that i want to increase my holdings of MON... surprised by the JUNO drop... in between bought some BG but turned out to be a failure plus some really bad results. divested BG straight after the results...

 
At February 23, 2018, Blogger Money Turtle said...

Just wondering what's taking so long with the BG buyout...

JUNO: Even with HSR approval and closing in ~ 1 week, you still have a ~ 10% annualized return at these prices. I picked up some common. Very low risk at this point...

 

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