THE B9 ENVIRONMENTAL CONTROL ROBOT AND SOME OTHER STUFF
Let's start with the meat and potatoes of this segment, followed by the appetizer.
As of the close today, the portfolios are long: WMIH, HMPR, SPNS, CIDM, EVOL and IWSY. Overall exposure sits at roughly 85% long and 15% cash.
SPNS has been reinitiated after I took profits on the position in May, after holding it for 11 months.
Even after the run SPNS has had over the past 12 months from the mid-3 range to near 6, there remains considerable upside for the name, as the recognition of the role the company is playing with financial sector compliance software continues to be underestimated. The company continues to make progress with their DECISION software, specifically targeted at larger financial institutions. This brings about a completely new revenue stream that the market hasn't factored into the price here. In fact, the market is just starting to get the significance of the progress the company has made in their bread and butter - the insurance space - over the past 12 months.
Here is the original research PDF from June of last year http://www.t11capital.com/wp-content/uploads/2013/07/T11-SPNS-Research.pdf
I tweeted the position earlier today:
Since B9 Environmental Control Robot (aka my mechanical system of allocation) has calmed down over the past several days, I now feel safe enough to up exposure closer to the 100% invested level. This is irrespective of how I feel about having this level of exposure personally.
If I was to invest based on how I felt personally about the state of the markets at any given moment then I wouldn't get very far in terms of adding exposure. Additionally, I would be running for the exit door at the first whiff of bad guys. I worry too much about everything to allow myself to personally get involved with opinions regarding general market direction. This is exactly why I turn to the B9 Environmental Control Robot as well as the chart work I do on a daily basis. It is all a way of getting away from my own personal worry, instead relying on what I observe to be facts.
The facts tell me it is time to get even longer than the 85% exposure that I currently have. Who am I to argue?
