Connect with us

Global Banking and Finance Review is an online platform offering news, analysis, and opinion on the latest trends, developments, and innovations in the banking and finance industry worldwide. The platform covers a diverse range of topics, including banking, insurance, investment, wealth management, fintech, and regulatory issues. The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website. .

Business

SPIN-OFF INVESTOR PUBLISHES RESULTS OF 15-YEAR RESEARCH STUDY ON CORPORATE SPIN-OFFS, DEMONSTRATING AVERAGE ANNUAL INVESTMENT RETURN OF 29.5%

SPIN-OFF INVESTOR PUBLISHES RESULTS OF 15-YEAR RESEARCH STUDY ON CORPORATE SPIN-OFFS, DEMONSTRATING AVERAGE ANNUAL INVESTMENT RETURN OF 29.5%

Spin-Off Investor (https://www.spinoffinvestor.com) publishes the results of its groundbreaking, 15-year research study in the book, “ALPHA FOUND: Understanding Corporate Spin-Offs and How to Trade Them for Maximum Profit.” These results are the foundation and proof for the Spin-Off Investment System™ (the “System”), a proprietary methodology developed by company Co-founders Geoffrey Hossie and Paul Cuatrecasas.

figure-1Spin-Off Investor’s research study describes how, over the course of the last few years, three former hedge fund professionals created, designed, back-tested and optimized a proprietary investment system covering US corporate spin-offs occurring from January 1, 2000 to April 30, 2015. Strikingly, the System on a synthetic basis delivered an average annual return of 29.5% versus only 6.0% for the Russell 2000 Total Return Index and 9.0% for the Guggenheim Spin-Off Exchange Traded Fund – and with lower volatility (see Figure 1). The System employs an optimized use of stop-losses and position sizing, as well as leverage to maximize the return-to-risk dynamic. During the 15-year period covered by the research, the maximum gross exposure was 2.0x and the average gross exposure was 0.9x.

“We believe the Spin-Off Investment System™ represents a breakthrough for disciplined individual investors looking to generate long-term investment returns that may significantly exceed the returns achieved by most institutional investors with similar – or even less – risk,” explains Cuatrecasas.

According to their research and that of others, the back-tested annual results of the Spin-Off Investment System™ over the study period are consistently well above all but the most successful professional investment managers and exceed the returns available from over 90% of all mutual funds, hedge funds, exchange-traded funds and CTAs over the same period.

“Over 50 years of peer-reviewed academic and investment banking research have demonstrated the excess returns available, in the aggregate, from investing in a portfolio consisting of corporate spin-offs,” adds Hossie. “However, the challenge to alpha-seeking spin-off investors is to answer what we call the ‘Seven Key Questions’ for successful spin-off investing, such as: ‘Which spin-offs should I buy? Should I buy the parent company, too? How long do I hold the investment?’ Most importantly, we consider what stop-loss and position size to use in the portfolio to optimize the reward/risk equation.”

Hossie and Cuatrecasas have ambitious plans for Spin-Off Investor, including a bi-weekly newsletter covering the investments of the System, as well as launching a real-time Portfolio Update Alert Service available to investors who wish to track the System’s trades. Looking ahead, the duo hopes to expand their research to cover spin-offs worldwide, equity market hedging, and refined security selection parameters to be used by the System.

Global Banking & Finance Review

 

Why waste money on news and opinions when you can access them for free?

Take advantage of our newsletter subscription and stay informed on the go!


By submitting this form, you are consenting to receive marketing emails from: Global Banking & Finance Review │ Banking │ Finance │ Technology. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Recent Post