September 2015 Performance
September is basically another repeat of August. There were no merger arb positions closing in September to give my portfolio a boost. I’ve positioned to take advantage of some anticipated merger arb closings in Q4 such as WuXi Pharma Tech (Ticker: WX), Integrated Silicon Solution (Ticker: ISSI) and Dealertrack Technologies. I also have some pre-deal special situation plays such as Molson Coors (Ticker: TAP) and BioMed Realty Trust (Ticker: BMR). I believe the merger positions will help buffer my portfolio during this volatility (unless there’s a blow up).
Just trying to be patient in this market environment and not to over react...
2015 Performance Year to Date = +14.86% 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%
September -4.89%
Edit: I sold my position in Molson Coors today to reduce my equity exposure.
posted by Money Turtle @ 10:26 AM
23 comments
23 Comments:
PMCS SWKS deal, what do you think?
why the close is so far may 2016 estimate? idem for PCP and ALTR why merger are so long now, and very few tenders?
It looks like a safe deal. They're probably factoring in some long regulatory review so you have a closing in the first half of 2016.
You need the right conditions for a tender offer. You tend to see tender offers in biotech / pharma deals. The biotech / pharma deals usually sail through the regulatory review without a problem. And these companies want to close the deal fast to avoid any potential MAE from clinical results, etc...
ALTR up 2% with no news today? please check it!
Yes, ALTR has been strong. EU is expected to rule by 10/14.
So what we do in ALTR?
ALTR is currently $51.67 and according to the reports: "Intel announced it would acquire Altera in June for $54 per share". That leaves only a little over 4% return for something expecting to close in June and still requires approval from European and Chinese regulators.
See article:
http://www.thestreet.com/story/13280175/1/intel-intc-stock-up-on-regulatory-approval-of-167-billion-altera-deal.html?puc=yahoo&cm_ven=YAHOO
This does not seem like a great return for a deal that is still uncertain. Is the market pricing in a possible higher offer?
Where do u see June approval? Intel said 6 to 9 months when they announced the deal in may
The June approval was in reference to the PMCS / SWKS deal. I've been modeling a close by the end of the year. Still a very attractive return on an absolute and annualized basis.
I will not tell anyone whether to buy or sell. That's a personal decision...
"Intel announced it would acquire Altera in June for $54 per share" is a quote from the article here:
http://www.thestreet.com/story/13280175/1/intel-intc-stock-up-on-regulatory-approval-of-167-billion-altera-deal.html?puc=yahoo&cm_ven=YAHOO
I suppose that it could mean that it was announced in June
Thanks for BMR. Thoughts on SWI and EMC? Call spreads 1x2 for EMC
Thanks, I liked the BMR odds. It was cheap with limited downside…
The stock portion worries me a bit on the DELL / EMC play. For me, it’s too hard to play without knowing more about the equity component. I get a sense that a lot is priced in already.
SWI is interesting. I don’t see a big premium from here since it’s all PE firms pursuing the company. A possible deal by month end so still got some time to play this one.
Why you always been so negative on ALTR INTC?
US give OK, in few days EU will give ok... and you are so negative so for China?
when China will give ok the prices will go to 53.75 and what do you want then of yeld there?? I think you was too much afraid of this deal, I can understand,
but I was thinking here there was a very good risk reward.
What makes you think I'm negative on ALTR / INTC?
this is our perception as readers :( no bets on this deal, and was very huge 9% yeld few days ago and now we reed that EU will give ok unconditionally .... so this could be a very nice deal to follow.
I'm in it but due to high spread and even your few attention to this deal, I closed part of at 52 and 52.50, but I could do much better, I was 100% in it, now just 30%. :(
I do have a ~ 10% position in ALTR. I re-entered the position after the US approval.
To the previous anonymous writer, please use ur opinion as mine and not " this is our perception as readers".. make ur own decision regarding your own money..
MT does an exceptional job and I can't even the mention positive effect this blog has on my trading experience since 2009
Thanks MT.
AAPLTRADER
Anonymous - I can see your point since my follow up writing on ALTR / INTC was limited. I didn’t write too much on it since I was focused on researching on other arb plays. It’s great that you made some good $$$ on ALTR.
And thanks for the comments from AAPLTRADER. Every day is a learning experience for me and hopefully for others as well…
my critic was positive, to push him to work harder and don't lose focus :)
I think on my view that ALTR/INTC deal was a good one, and few attention.
We are not english native, him yes, you yes, you can understand and have much higher perception of us, that sometimes we have to risk to much, or get panic like on ISSI few days ago.
So thanks for all your job of course.
What about PCP? special meeting 19 november, can this accelerate the close as in a SA article I showed you weeks ago that was betting for a close before end of year?
Regarding PCP the FTC / DOJ waiting period has expired. It should be clear sailing, but the company is still guiding for a Q1, 2016 close. I didn't take a close look to see what other conditions are required for this deal to close.
Anonymous- How fast is a TURTLE gonna go.. forcing a trade is not a good strategy either.
there are lots of websites offering quick returns if you want to push the limits
Good luk with trading
Aapltrader
Funny! :) "How fast is a TURTLE gonna go..."
From my view it's all about conviction. You just have to do the homework to have any conviction on a trade. I see a lot of parallels with poker. When the odds are in your favor, you increase your bet. But you also need to know when to fold and walk away.
hi EU just approved the deal. Two of the big 3 (US, EU, China) regulatory authorities had approved. China is next. I saw a post in twitter (I know its dubious) that says "Intel Filing on Altera Formally Accepted by Mofcom" by @RiskArbOFI. A formal acceptance of filing means the merger moves to the case team which starts reviewing the merger. This is another step forward as the pre-acceptance phase can take many weeks by itself.
After china is all the other countries like Japan, Taiwan which should clear relatively quickly.
Yes, I saw the same tweet on the MOFCOM filing acceptance. MOFCOM has been moving a bit faster these days, but they will certainly scrutinize this deal.
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