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%
January +2.80%
posted by Money Turtle @ 10:59 PM
23 comments
23 Comments:
same with BIVV and JUNO. I also added abit of March AKRX. Major position in MON.
Hi MT,
Did u sell any of your core investments? Hopefully big drop last Friday doesn’t continue into last week.
Thanks
No, I did not sell any core positions in the down draft.
any jitters out there on JUNO and BIVV? spread is wide considering HSR expiry in 2/20 and 2/22 respectively.
thanks
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...
BIVV: Also require anti trust approvals from Sweden and Japan. Sweden decision is expected on 2/28 and Japan ???
Thanks for the info.
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
Yes, I reinvest dividends for my long term holdings. Reinvesting dividends helps with compounding your returns over time.
It looks like Rite Aid is on the table again
I'm not touching RAD again... I don't like the structure of this deal.
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...
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...
STRP shot up to $186.
Anyone know of rumors for this?
(it is above the VZ offer of $184).
STRP that's been off my radar. Don't know of any info that could contribute to the spike.
it seems like BG merger is not happening soon. From the language of both ADM and BG during their earnings report, it seemed like both companies are not close in merger. AKRX is another bomb for me although i sold just a few puts. I am still holding on because of the non-conclusive nature of the investigations and the difficulties in proving MAC clauses in mergers
Hi MT,
Do you have an opinion on the Monsanto/Bayer Merger?
Thanks
It's not surprising that the regulators are dragging their feet on approving the Monsanto / Bayer merger. Bayer is now guiding for Q2 completion. I see a high probability that this deal will close, but will take a bit more time. I may play this after I'm done with JUNO & BIVV.
Dear MT,
It's march already so if you intend to play with MON you have to do it soon... Expected approval from EU is coming end of march or latest early Apr. Anyway EU approval is almost priced in. DOJ approval will bring this to near $126 i think. Curiously, DOJ/FTC approval came exactly 1 week after Dow/Dupont and Syngenta's EU approval... I'm not sure with DOJ will follow the script for Monsanto as well...
regulatory approval for big agri-chem mergers are synchronized worldwide so it makes sense that the approvals will come close together also for the big regions... Brazil->EU->DOJ/FTC->MOFCOM
Based on todays closing JUNO offers >10% annuliazed return
All... Thanks for the run down on MON.
I'm a bit surprised that the JUNO spread has not tightened some more. I've tendered my shares and will likely let the short Puts expire.
Maybe due to JUNO earnings tomorrow after market.. I was hoping it would close around 86.9
Aapltrader
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