Monday, August 31, 2015

August 2015 Performance

Do I need to say any more about the month of August? I do expect this volatility to continue going forward, which is actually not bad. People were getting very complacent and we do need people to start doubting this market. As they say, the market climbs a wall of worry.

My portfolio was actually down by more than 10% at one point, but ended only down -0.89% for the month. The closing of the Receptos acquisition by Celgene (Ticker: CELG) definitely helped a bit. Constellation Brands (Ticker: STZ), which is my largest holding, held up well during this market volatility.

So right now, it’s just a wait and see. Like I mentioned earlier, WuXi Pharmatech (Ticker: WX) is my only arb play at the moment and it comprises only ~ 15% of my portfolio.

That’s all I have to report…

2015 Performance Year to Date = +20.76% with the running monthly returns as follows:

January +3.4%
February +7.03%
March -0.33%
April +0.39%
May +5.59%
June -1.2%
July +5.48%
August -0.89%


At September 01, 2015, Anonymous Anonymous said...

How do you decide when to exit? I think you have been holding STZ from around 30's. Also do u sell covered calls or buy puts?

At September 02, 2015, Blogger Money Turtle said...

That’s probably the toughest decision of when to exit… For me, it’s just having a strong conviction and making sure that the story continues to plays out. I don’t use options with the long term plays since I really don’t have a defined exit time. Whereas in merger arb plays, I have a good idea of when a deal will close and will use options (mostly short puts) to enhance the returns.

With Constellation Brands, I first entered this position as a special situations play and as the story unfolded, my conviction became stronger. I look for catalyst, i.e. with STZ you have the manufacturing build out, increasing free cash flow, dividend payout / future stock buy backs, debt deleveraging, etc... I believe the company has executed well, except for the initial cost overrun in expanding the manufacturing operations. STZ was really at the right place at the right time… So with STZ, I don’t know when I’ll end up selling, but it’s not going to be anytime soon (unless the valuation is in the stratosphere).

At September 02, 2015, Anonymous Anonymous said...

Hi, what do you think of SURG? seem nice deal... with that right they will give could be huge yeld?

At September 02, 2015, Blogger Money Turtle said...

I’m keeping a close eye on SURG. The CVR of $1.00 is attractive.


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