Time to Press the Accelerator!

Date Added: January 2, 2018 | Comments (1) | Filed under: Blog

The numbers are still being compiled and won’t be available for a week or so but after a +40% return in 2016 it looks like the flagship Takota Premium Value Partnership will have appreciated by approximately +24% in 2017.

Decent return numbers to be sure but given the late state of the business cycle and the orientation of the portfolio toward certain economically sensitive situations (in addition to the usual special situations), and the nature of the return distributions for such economically sensitive situations (i.e. big tails – meaning the weight of the return is skewed toward the latter part of the business cycle and holding period) more significant positive return numbers are immediately possible. I’m not a successful stock market forecaster (nor do I believe is anyone else) but I have seen this pattern before in my 30 odd years in the market. That which was scorned in the aftermath of the financial crisis and which endured depression like conditions  in the 2011 -21015 period will provide the positive stock market leadership for the balance of the business cycle. I believe this will provide us with accelerating good results.

The pattern of return for the proceeding two years has been weakness in the first part of the year followed by strength in the latter parts of the year. My expectation is for this pattern to be broken in 2018 with news pending on corporate developments for several portfolio holdings driving higher Partnership values early in the New Year. We shall see.

It is time to press this opportunity and maximize the result, with the expectation that upon realization, the Partnership at a much higher per Unit value will likely hold higher cash balances and that the subsequent set of opportunities may have more to do with the downside of financial assets, rather than their upside. That is the next chapter – for now we will focus on maximizing the opportunity immediately in front of us.

Time to Press the Accelerator!

Scott

The Takota Premium Value Partnership is only available by direct purchase through Takota Asset Management. At this time the Partnership is available* to new accredited investors on an exception only basis due to the dilution of tax deferral benefits for existing investors when new investors are introduced. The Partnership is a concentrated value focused portfolio of securities and consideration for exception and inclusion as a new limited partner would be based on discussions with the Portfolio Manager as to the potential limited partner’s time horizon, investment philosophy, and temperament.

* Separately Managed Account (SMS) versions available for Takota Classic Value Strategy, Takota Premium Value Strategy, and Takota Income Value Strategy.


1 Comment »

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