My net-net strategy isn't to focus on baskets, but to make focused commitments to the best net net ideas. A big part of discerning "the best" is to always identify a catalyst that will unlock value. Could be buybacks, index addition, merger/sale, or large dividends. The one catalyst I've gleaned from this writeup is dividends and occasional special dividends, but they are erratic and unpredictable. Thats a weaker catalyst and heavily dependent upon management, which here is also unpredictable.
That said I think this is enough of a catalyst to be confident this idea is likely to work out, but I also think that if over time you keep looking you'll find others with much stronger catalysts and will have much more certain outcomes.
Thanks for your comment. I agree, this one can go sideways. It was one of the better ones I could find in North America. There are many of them higher quality and cheaper in countries like Singapore, but there are these exact problem of capital allocation. I think when you have a net-net that pays special & regular dividends, if there is one positive thing occuring, the investors might get excited and get it close to NCAV. Will it happen? I am not sure. The sale of their investment property here could occur though. Again not sure on probabilities. Would you have any net-nets you would like to discuss, feel free doing so. I am trying to know every one there.
My net-net strategy isn't to focus on baskets, but to make focused commitments to the best net net ideas. A big part of discerning "the best" is to always identify a catalyst that will unlock value. Could be buybacks, index addition, merger/sale, or large dividends. The one catalyst I've gleaned from this writeup is dividends and occasional special dividends, but they are erratic and unpredictable. Thats a weaker catalyst and heavily dependent upon management, which here is also unpredictable.
That said I think this is enough of a catalyst to be confident this idea is likely to work out, but I also think that if over time you keep looking you'll find others with much stronger catalysts and will have much more certain outcomes.
Hi nVariant,
Thanks for your comment. I agree, this one can go sideways. It was one of the better ones I could find in North America. There are many of them higher quality and cheaper in countries like Singapore, but there are these exact problem of capital allocation. I think when you have a net-net that pays special & regular dividends, if there is one positive thing occuring, the investors might get excited and get it close to NCAV. Will it happen? I am not sure. The sale of their investment property here could occur though. Again not sure on probabilities. Would you have any net-nets you would like to discuss, feel free doing so. I am trying to know every one there.
Jacob
For full disclosure, my strategy has worked poorly this year, but has been very successful in almost every prior year.