Nanotech Insights #12
Those of you who followed our trades achieved fantastic profits in our recent stock picks of the last few months. These outcomes continued our long trend that began in February of 2006 of beating the appropriate indices (PXN and The Nanotechnology.com Small Tech Index) by significant margins in up, down and sideways markets (mostly down over those 27 months).
You would have bought CHRT at $5.58 and sold it at $6.63 for an 18.8% profit in about a month.
You would have bought ADI at $29.75 and sold it for $35.70 for a 20% gain in the same timeframe.
Lastly, after buying CCMP $31.87 you would have sold it on our advice at $37.25 for a similar gain of 16.9%.
These profits were booked while the indices were up only 1 or 2%.
We believe these extraordinary profits (please revisit Insights #7-11 as well as our Small Tech Prospector archive to see the history and each individual trade) combined with extremely low risk, relative to the market, makes our continuing case for hedge fund management skill.
We credit our distinctive and unique combination of a proprietary pattern-recognition trading methodology with the scientific and engineering expertise of our junior scientists and Scientific Advisory Board (SAB).
I would like to take this opportunity to publicly thank each of them for their continuing support over the last 2 to 6 years and for what we believe will be an exciting, profitable future.
Sincere “Thank you” to the SAB led by my partner and co-founder, Erkki Ruoslahti, M.D., Ph.D. and including other eminent, internationally renowned scientists from diverse, “small tech” disciplines, Reza Ghadiri, Ph.D., Sangeeta Bhatia, M.D. Ph.D., Pulickel Ajayan, Ph.D. and Dan Morse, Ph.D.
Thanks also to the young scientists who have helped us identify winners and keep us away from losers over the last four years and into the future, especially Albert Lin, Ph.D. from UCSD, and Arya Kumar, Ph.D. from Case Western Reserve, Todd Harris, Ph.D. from MIT/Harvard and Geoff von Maltzahn from MIT/Harvard.
At the end of 2007, I wrote:
“We see the stock market (as defined by the SPY) as trapped in a wide, multi-month trading-range between 140.65 and 157.55. Until the SPY has two consecutive closes above or below those numbers, the market is likely to do very little. Once the two consecutive closes occur, look for fireworks. If the market climbs the wall of worry out the top we’ll likely see 167.50+ fast. If, on the other hand, the downward water-drop-torture that began in mid-October continues and we break to the downside of the range, a true Bear Market will take the bottom down below 126. Watch those exact, defining trading-range numbers closely; given how they were generated (with my most important, proprietary topping and bottoming patterns invoked), they are as close to a sure thing as you get in the markets. Small & advanced tech stocks are more inclined to decline.”
If you check the charts, you’ll find that the SPY had the two consecutive closes below 140.65, crashed sharply lower quickly, and then made a tentative double- bottom at 126 (not going below, yet) in the Jan-March time-frame.
Quick comments on the
- A typical to severe recession started between November of 2007 and March of 2008. Expect the world to join us in this view as the numbers become clear between August 1 and
- The housing recession will begin to re-accelerate to the downside in the last quarter of 2008 as the real culprits (not sub-prime) just begin to come home to roost: prime, option-ARM mortgages and home equity loans.
- Look for the SPY to make another interim bottom between 131.50 and 126.00 by August 15. After moving sideways to higher for 1-3 months, look for the market to crash below 117.50 before finding its eventual, long-term bottom.
In what state do we see “small” & advanced technology stocks and investing?
As we have been saying since 2003, more companies will find themselves with significant development and financial issues, combined with imposing investment needs over the next 3 years, than at any time in the last 8 years or, likely, any time beyond 2011.
The Nanotech Company, LLC (contact: Info@Nanotechnology.com) will shortly “daylight” a well-capitalized merchant bank of another name, focused on financing and shepherding “small” & advanced technology companies as well as the financial and fund companies that serve investors in those technologies. The Nanotech Company, LLC and a small group of sophisticated investors, scientists, engineers and financial professionals will own the firm. Combining critical, in-depth knowledge of private and public company finance, deep scientific and technical expertise and vital insight into the commercialization path of cutting-edge technologies, we intend to build the merchant bank into the leading, most profitable company in our “space” for decades to come.
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