Quote of the day
Brad Balter, ?(T)here are thousands of long-short equity hedge funds out there already?who needs another?? (NetNet)
Chart of the day
Results 1 to 10 of 78
Thursday links: yet another hedge fund
Quote of the day
Brad Balter, ?(T)here are thousands of long-short equity hedge funds out there already?who needs another?? (NetNet)
Chart of the day
Already Up 40% This Year, This Rental Giant Could Add 15% Before 2014
In this market, finding a stock with strong upside that also happens to have come down well off of its 52-week high isn't as easy as it may seem.
But thanks to what I call the performance protection trade, there are high-fliers that have pulled back. Stocks such as Tesla Motors (Nasdaq: TSLA) and Facebook (Nasdaq: FB) fit this description well, as does auto and equipment rental giant Hertz Global Holdings (NYSE: HTZ).
HTZ has rewarded shareholders with a 40% gain in 2013, easily besting the benchmark S&P 500 Index's 24% year-to-date showing.
However, at the time of its 52-week high of $27.75 in mid-July, HTZ was up more than 70%. Shares sold off through the rest of the summer before retesting that high in September.
Then, in late September, HTZ suffered a huge one-day sell-off that drove it below both the 50-day and 200-day moving averages. HTZ currently trades near $22.80, about 17% off its recent highs and right about where it traded in mid-April.
IPO Flipping is the New Source of Hedge Fund Alpha
?I?ve been doing fifty million a year in commission business with your desk, and believe me, it?s not because I care what your chief strategist?s research reports say. You?re not allowed to give me ?color? on the trading activity of others anymore because your line?s recorded. You?re also not able to create products that will fail for me to be able to short. And I sure as hell don?t need your firm?s Barclays Center tickets, I?m a Knicks fan and I have a box at the Garden. The least you can do is get me a million shares of the LinkedIn IPO.?
One of the key sources of alpha for famous hedge fund managers operating in the late 1990′s was the IPO flip. They won?t admit it now when citing their ?compound returns? from that era, but everyone in the game knows it. And then the strategy kind of went to sleep as IPOs cooled off and the markets stopped guaranteeing mammoth first-day pops.
But over the past year or so it?s been Game On again. As explained in the below linked-to article at ValueWalk, this is a perfect environment for it. The public is once again hungry for deal stocks and will bid up shit like Potbelly and the Container Store by 100% upon the open, it?s almost a lock. In the meantime, companies ? specifically tech startups ? have been holding off on their IPOs to the extent possible, giving capital rich hedge funds an even better opportunity than IPO share ? they?re actually buying in at earlier stages while the company is still private. This makes the profit on the flip even juicier.
Profits are profits and no one is saying these gains require an asterisk next to them. But be aware that this source of alpha is likely finite and fleeting.
Profit From ID Theft -- Legally -- With This Stock
In the world of identity theft, it doesn't pay to assume "it won't happen to me."
In fact, with an average of a new victim every three seconds in 2012 -- and the rate of breaches seeming to increase at a faster pace than the national debt -- you might as well assume that it will happen to you and be prepared when it does.
Identity theft can dig you a debt ditch deeper than the Mariana Trench. But I've found a $1.4 billion company -- a mere pollywog among the multi-billion-dollar big fish in this sector -- that's throwing out lifelines to consumers and dishing out profits to investors.
In fact, this little gem just reported record revenues and hundreds of thousands of new customers in the third quarter. Its IPO went for $9 just over a year ago, and newcomers to the stock are basking in 75% gains.
We'll take a closer look at the company in a moment, but first, let's talk about what drives this crime today, how big the business of identity theft has become, and what is being done to protect people like you and me.
A $21 Million Violation Of Privacy
Unfortunately, the same technologies that make banking, shopping and working so convenient also make identity theft easier. An estimated 12.6 million people were victimized last year, at a cost of $21 billion. At a projected annual growth rate of 4%, the losses are on pace to grow even more staggering.
Stolen Social Security numbers caused the most damage because they're almost always required to open new accounts, but credit card fraud accounts for more than 65% of all cases.
The ways in which thieves steal information has become sophisticated: They can read "noise" waves and intercept data with ATM skimmers, or infiltrate peer-to-peer networks like music sites. Other ways include phishing (by email), "SMSishing" (by text) or "Vishing" (by voicemail).
It's not all rocket science, though. Many old-school ways still work: Dumpster diving, wallet stealing, snail mail swiping, looking over someone's shoulder at a device, giving credit card numbers to customer service reps or inputting any data online.
Unfortunately, thefts are adept at cracking codes, creating viruses and weaseling their way into improperly secured networks at work, school, banks -- really, any place that involves a computer.
People can only go so far to protect themselves, and, unfortunately even the most savvy IT professional in the world isn't capable of building an impenetrable fortress.
Unlocking The Door To Profits
Profit From ID Theft -- Legally -- With This Stock
In the world of identity theft, it doesn't pay to assume "it won't happen to me."
In fact, with an average of a new victim every three seconds in 2012 -- and the rate of breaches seeming to increase at a faster pace than the national debt -- you might as well assume that it will happen to you and be prepared when it does.
Identity theft can dig you a debt ditch deeper than the Mariana Trench. But I've found a $1.4 billion company -- a mere pollywog among the multi-billion-dollar big fish in this sector -- that's throwing out lifelines to consumers and dishing out profits to investors.
In fact, this little gem just reported record revenues and hundreds of thousands of new customers in the third quarter. Its IPO went for $9 just over a year ago, and newcomers to the stock are basking in 75% gains.
We'll take a closer look at the company in a moment, but first, let's talk about what drives this crime today, how big the business of identity theft has become, and what is being done to protect people like you and me.
A $21 Million Violation Of Privacy
Unfortunately, the same technologies that make banking, shopping and working so convenient also make identity theft easier. An estimated 12.6 million people were victimized last year, at a cost of $21 billion. At a projected annual growth rate of 4%, the losses are on pace to grow even more staggering.
Stolen Social Security numbers caused the most damage because they're almost always required to open new accounts, but credit card fraud accounts for more than 65% of all cases.
The ways in which thieves steal information has become sophisticated: They can read "noise" waves and intercept data with ATM skimmers, or infiltrate peer-to-peer networks like music sites. Other ways include phishing (by email), "SMSishing" (by text) or "Vishing" (by voicemail).
It's not all rocket science, though. Many old-school ways still work: Dumpster diving, wallet stealing, snail mail swiping, looking over someone's shoulder at a device, giving credit card numbers to customer service reps or inputting any data online.
Unfortunately, thefts are adept at cracking codes, creating viruses and weaseling their way into improperly secured networks at work, school, banks -- really, any place that involves a computer.
People can only go so far to protect themselves, and, unfortunately even the most savvy IT professional in the world isn't capable of building an impenetrable fortress.
Unlocking The Door To Profits
Because identity theft has become so prevalent and such a b
What Does the Dove Say?
Janet Yellen speaks before the Senate Banking Committee this morning at 10am. She?s released her brief address beforehand and will probably be answering a wealth of questions, especially on the idea of the taper.
Here?s BofA Merrill?s US Economics team with a preview on that score:
The taper question, ultimately
Yellen states that ?supporting the recovery today is the surest path to a more normal
approach to monetary policy? ? in other words, policy needs to remain easy now to
tighten later. Additionally, ?a strong recovery will ultimately enable the Fed to reduce
its monetary accommodation and reliance on unconventional policy tools such as
asset purchases.? Early commentary focused on the word ?ultimately? as a possible
signal that Yellen does not plan to taper for a while. But ?reduce its monetary
accommodation? typically has meant rate hikes in official Fed communication, while
reducing ?reliance on unconventional tools? likely refers to the eventual reduction in
the size of the Fed?s balance sheet rather than tapering. Recall, most Fed officials
take a ?stock approach? to QE; in that view it?s the total amount of assets owned and
not the purchase pace that defines the degree of accommodation. No doubt she?ll
get questions about the Fed?s tapering plans on Thursday.
Expect market participants to be hanging on her every word?
What Does the Dove Say?
Janet Yellen speaks before the Senate Banking Committee this morning at 10am. She?s released her brief address beforehand and will probably be answering a wealth of questions, especially on the idea of the taper.
Here?s BofA Merrill?s US Economics team with a preview on that score:
The taper question, ultimately
Yellen states that ?supporting the recovery today is the surest path to a more normal
approach to monetary policy? ? in other words, policy needs to remain easy now to
tighten later. Additionally, ?a strong recovery will ultimately enable the Fed to reduce
its monetary accommodation and reliance on unconventional policy tools such as
asset purchases.? Early commentary focused on the word ?ultimately? as a possible
signal that Yellen does not plan to taper for a while. But ?reduce its monetary
accommodation? typically has meant rate hikes in official Fed communication, while
reducing ?reliance on unconventional tools? likely refers to the eventual reduction in
the size of the Fed?s balance sheet rather than tapering. Recall, most Fed officials
take a ?stock approach? to QE; in that view it?s the total amount of assets owned and
not the purchase pace that defines the degree of accommodation. No doubt she?ll
get questions about the Fed?s tapering plans on Thursday.
Expect market participants to be hanging on her every word?
Fine, sorry. Here:
