SPACS research - 09 January: PIPP and SWBK
As always we will look at team, sector, hype potential and chart then decide on a position size.
PIPP
This just opened for separate trading as of 07/01/2021. I was recommended this one by SPAC Mikey on Twitter.
* Strong financial services team - former Merrill Lynch / Goldman Sachs bigwigs John Thain and Phillip Cooper.
* Searching for goverment, defense and aerospace businesses.
* Big hype potential on this one due to strong team, sector and an empowered incoming govt. administration
* Chart shows massive listing pump, then slow bleed. Consider laddering bids
Strong yes, but with the proviso that they're still searching (no Def agreement) so could be a waiting game on this one.
I'd be tempted to set a couple of bids and see if I can buy between 10.30 - 11.00, but equally 11.00 could be the new support and we climb to the 12's from here.
Buy half a position on spot for 11.00 in accordance with my strategy - buy big in the 10-12 area for SPACs. Timeframe needs to be 6-12mths potentially.
Try to buy other half of position via bids into the mid 10's.
SWBK
I can't trade this one yet, but expect to be hyped when more widely available to retail.
* NGP and RPS Permian executives, second SPAC after wildly successful SBE Switchback Energy
* Scott McNiel and Mutrie head up the team
* Same target again - energy transition or sustainability
* Hype potential, but important to remember they're still just searching
* Chart's had initial pump/dump now trying to build a base in 11's
Verdict: Yes, but buy in increments. Think this one will be a crowded trade. Set bids to get good average quarter position when this hits market if in 10-12 range and then see how chart develops.
Additional thoughts
You can see newly listed SPACS by going on SEC.REPORT and searching 'acquisition'
IPO Scoop and their calendar is a pretty good resource as well although has mix of SPACs / IPOs
Biggest problem for SPAC investors is that market is becoming diluted, a good sign we are mid-bubble. So capital allocation is going to become a problem.
I either need to A) have many small positions and a few 100 pound gorilla positions, or B) simply be more picky and set a higher threshold of what I buy. Only have a dozen or so in play. For example
INAQ
Tempted to go with A) and see how that goes over next 8 weeks or so. Position sizing and risk management is everything. One advantage of A) is that it would allow me to buy more nominal asset value $10 SPACs in small pieces, and let those sit for 6 - 12 months until they pop. Nice low-risk low-stress trade.
PIPP
This just opened for separate trading as of 07/01/2021. I was recommended this one by SPAC Mikey on Twitter.
* Strong financial services team - former Merrill Lynch / Goldman Sachs bigwigs John Thain and Phillip Cooper.
* Searching for goverment, defense and aerospace businesses.
* Big hype potential on this one due to strong team, sector and an empowered incoming govt. administration
* Chart shows massive listing pump, then slow bleed. Consider laddering bids
Strong yes, but with the proviso that they're still searching (no Def agreement) so could be a waiting game on this one.
I'd be tempted to set a couple of bids and see if I can buy between 10.30 - 11.00, but equally 11.00 could be the new support and we climb to the 12's from here.
Buy half a position on spot for 11.00 in accordance with my strategy - buy big in the 10-12 area for SPACs. Timeframe needs to be 6-12mths potentially.
Try to buy other half of position via bids into the mid 10's.
SWBK
I can't trade this one yet, but expect to be hyped when more widely available to retail.
* NGP and RPS Permian executives, second SPAC after wildly successful SBE Switchback Energy
* Scott McNiel and Mutrie head up the team
* Same target again - energy transition or sustainability
* Hype potential, but important to remember they're still just searching
* Chart's had initial pump/dump now trying to build a base in 11's
Verdict: Yes, but buy in increments. Think this one will be a crowded trade. Set bids to get good average quarter position when this hits market if in 10-12 range and then see how chart develops.
Additional thoughts
You can see newly listed SPACS by going on SEC.REPORT and searching 'acquisition'
IPO Scoop and their calendar is a pretty good resource as well although has mix of SPACs / IPOs
Biggest problem for SPAC investors is that market is becoming diluted, a good sign we are mid-bubble. So capital allocation is going to become a problem.
I either need to A) have many small positions and a few 100 pound gorilla positions, or B) simply be more picky and set a higher threshold of what I buy. Only have a dozen or so in play. For example
INAQTempted to go with A) and see how that goes over next 8 weeks or so. Position sizing and risk management is everything. One advantage of A) is that it would allow me to buy more nominal asset value $10 SPACs in small pieces, and let those sit for 6 - 12 months until they pop. Nice low-risk low-stress trade.
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