Trick or Treat

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The information contained herein is accurate to the best of the author’s knowledge, but the material and interpretations contained herein should be independently verified by any party using this information as part of any research, editorial, or decision making process. Any views expressed here represent the author’s opinion only, and as such readers should do their own research and come to their own conclusions if they are using the opinions contained herein as part of any larger due diligence process. The author may have long or short positions in the companies mentioned and may be buying or selling in the market depending on which way the wind is blowing at any given moment. Opinions are subject to change without notice. Prospective resources, predictions, comparisons, financial projections, and extrapolated metrics are, by their nature, subjective and interpretation dependent. The topics covered are highly speculative and involve a high degree of uncertainty and risk. Speculative companies can and do go to zero. By using this site, you agree that the author(s) and Hydra Capital is/are not responsible for any damages incurred by the use of the presented materials. Anyone reading these blog posts should know that they are the author’s thoughts and opinions, which are not to be confused with or construed as research reports.

Disclosure: The following represents my opinions only. I am long BIG, CDR, CRE, NSE, RDU, TAO, TNZ, VLE

Halloween is just around the corner and change is in the air. Market winds are swirling with bond yields, the dollar, and the Fed’s next moves all keeping the market on edge. 2023 has been a tough tape for a lot of investors, but like any market, if you’ve picked the right stocks/sectors, the potential for outperformance is always there. Now, as we head into the end of the year, I find myself seeing potential catalysts on half a dozen “special situations” that I follow. Hence the trick or treat title today. While I don’t know what’s coming any better than the next guy, at this point, I can at least identify some of the doors that I know I’m going to see opened in Q4 — and I’m talking about the doors of those houses that could be giving away full-size chocolate bars here — you know, the houses that get visited even if it’s raining (as in, the kind of stories that can attract attention in just about any market tape). My focus right now is on oil, natural gas, uranium, and gold. I have a junior copper exploration story that scratches my “this could be big” itch, but generally speaking, my base metals exposure is low until copper turns around, but I do like the copper/base metal valuations and the general lack of interest in them (things aren’t on sale when they’re popular). I don’t have any special insights on the macro situation out there. Bond yields are an issue, but the Fed knows that they’re an issue, so the fix is waiting in the wings (yield curve control?) should yields spike too high (on the other side of that fix, should it be needed, hard assets would be expected to rally). In the meantime, I suppose we all just bite our nails and see how the economy fares under the new normal (?) interest rate environment.

I continue to focus on situations that most would consider high risk, but with me, there’s always a story, right? I can never cover everything, but I’ll go through a list of companies that I think will have meaningful catalysts between now and the end of the year. All are special situations and, mostly by chance, a lot of them may have significant news before the year is out. Whether that news comes, or if it is good or bad, remains to be seen — but that’s the very nature of trick-or-treat…

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