Author Topic: beating the market - not what it used to be  (Read 7768 times)

tombgrt

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Re: beating the market - not what it used to be
« Reply #80 on: May 14, 2018, 08:29:14 AM »
- Time horizon arbitrage: something like BAC in 2012 was a nice example: the thesis basically being: buy it, forget it, don't watch NBC, the storm will blow over in five years.
- Tax arbitrage: PFIC's are a bitch for US investors, maybe you can reclaim dividend taxes in some situations, get tax credits, etc. Research your tax situation and make the best of it. For me personally, Sapec was a great example. KMG was a nice example this year.
- Boredom arbitrage: somewhat related: basically buying cheap stuff without a catalyst: PD-RX was a nice example.
- Liquidity arbitrage: as a small fish it's relatively easy to boost returns if you can do a few good trades, i.e. put some lowball bids in several cheap stocks or try buying a microcap merger on the bid for a 20% IRR. CKTM was a great example this year.
- Gross stuff arbitrage: buying stuff that's so disgusting that no fund manager wants to own it. Chinese companies going private, Halal real estate in Dubai listed on the AIM exchange, microcap Canadian mining mergers, etc.
- Work harder and be smarter arbitrage: my least favorite option. Work harder and be smarter than other market participants.

I like this list. The only way to beat the market is to do things that other market participants are not doing. And the question then is why is it that market participants are not doing it. The above list provides a bunch of reasons:

1) Its gross
2) its boring
3) it takes too long
4) its too small

This list of reasons also extends to other areas of life  ;D

Agreed. Too many so called value investors don't dare to step away from large caps and/or North American borders. They refuse to invest in the temporarily ugly and dismissed stocks/markets. There are sectors and markets currently offering attractive bargains. They might hold slightly more risks, but they are often also potential multibaggers because everyone acts as if those risks have already played out. Investing in good, large and known US/CAN stocks isn't always an option if you want to outperform. 


rukawa

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Re: beating the market - not what it used to be
« Reply #81 on: May 14, 2018, 09:47:06 AM »
- Time horizon arbitrage: something like BAC in 2012 was a nice example: the thesis basically being: buy it, forget it, don't watch NBC, the storm will blow over in five years.
- Tax arbitrage: PFIC's are a bitch for US investors, maybe you can reclaim dividend taxes in some situations, get tax credits, etc. Research your tax situation and make the best of it. For me personally, Sapec was a great example. KMG was a nice example this year.
- Boredom arbitrage: somewhat related: basically buying cheap stuff without a catalyst: PD-RX was a nice example.
- Liquidity arbitrage: as a small fish it's relatively easy to boost returns if you can do a few good trades, i.e. put some lowball bids in several cheap stocks or try buying a microcap merger on the bid for a 20% IRR. CKTM was a great example this year.
- Gross stuff arbitrage: buying stuff that's so disgusting that no fund manager wants to own it. Chinese companies going private, Halal real estate in Dubai listed on the AIM exchange, microcap Canadian mining mergers, etc.
- Work harder and be smarter arbitrage: my least favorite option. Work harder and be smarter than other market participants.

I like this list. The only way to beat the market is to do things that other market participants are not doing. And the question then is why is it that market participants are not doing it. The above list provides a bunch of reasons:

1) Its gross
2) its boring
3) it takes too long
4) its too small

This list of reasons also extends to other areas of life  ;D

BTW, writser, what broker do you use to buy stocks on AIM. IB, AFAIK doesn't have this capability

CorpRaider

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Re: beating the market - not what it used to be
« Reply #82 on: May 14, 2018, 10:04:17 AM »
Beating the Market -  Same as it Ever Was.

Midas79

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Re: beating the market - not what it used to be
« Reply #83 on: May 15, 2018, 01:33:46 PM »
I just can't resist, shameful as it may be.

1) Its gross
2) its boring
3) it takes too long
4) its too small

That's what she said!