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ClickSoftware Technologie (CKSW) Message Board

  • per_a.jacobsen per_a.jacobsen Oct 4, 2013 1:33 PM Flag

    Rmm: Soros and Clicksoftware

    Rmm,

    You wrote: "Per_a.jacobsen - how does a fund go about unwinding their position in a thinly traded small cap?? I think a smaller fund might try a lot of small trades but for soros this represents (I checked some time back) a tenth of a percent of the fund. Anyone who purchases shares has to do so with the thought for Soros this is like me taking ten bucks out of my wallet. He can blow you out without a thought. Its small potatoes to the Soros fund. Whether more funds start to sell I think will depend on guidance for the third quarter. Eventually even soros will lose patience."

    Thank you for the note. I appreciate the feedback.

    I think you are being a little too focused on Soros (or, more precisely, with Soros' fund (I can assure you that Soros almost for sure has never heard about Clicksoftware, except as a line item in NAV report)).

    This leads me to the first point I wanted to make, and that is that the way institutional funds work, is that the money are divided up among managers. As such, there is no way to tell how important a position of CKSW is since we don't know the pedigree and allowance of the fund manager who actually made the decision to buy CKSW. Just as important, we don't know what the NAV performance is of the manager, and, so, we don't know what he or she might feel or want to do.

    The second point is that the move of 600 thousand shares in my opinion clearly was pre-arranged, and, so, the only strange thing about it, is that the market followed price down (moving 600 thousand shares in one go does come with an agreed-to discount.) The actual block was never truly on the market, and, therefore, the transaction did not reflect market value and the market should have immediately stabilized. This did not happen, and I think that that is a testament to how jittery the market is about CKSW.

    continued..

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    • continued...

      Finally, I just want to point out that while it is highly likely that the buyer was institutional, there is no reason to believe that the seller was *not* a retail investor. In fact, if you, as a retail investor, had followed Clicksoftware and CKSW for more than a decade (and you had tons of faith) there is a lot of ways that you could have accumulated 600 thousand shares.

      I am speculating, of course, but it would make sense to me if this was a retail investor getting out (I could imaging that he or she had used the base portfolio as leverage, and had loaded significantly up on the other side of $7.50, and was facing a nasty call.)

      Speculation, yes, but it does happen. When you as a retail investor has accumulated a large enough position, you can get a call from a broker for an institutional buyer, who represents a client who wants in. In most cases, if you can't foresee a merger, this is actually the best and most profit-yielding way to exit your large position, and, so, the rest is just details and mechanics.

      Best,

      pajacobsen

      • 1 Reply to per_a.jacobsen
      • Everything you say is correct. Yes indeed I am sure that the soros fund has its money divided among other managers, although I was kind of surprised when 60 minutes did a segment on Carl Ichan, it was just Carl, his son and a couple other people. I was talking about the soros fund as a whole but yes if the fund is divided click could be more important to that manager. I just have this picture of Soros (or the person who runs the fund) going down the list of stocks at the end of the quarter and maybe telling the manager to sell and get out. I am sure they would shop the shares around just like ackman shopped his JCP shares (and now looks like a genius for getting out). Some people just seem to place faith in soros and that's the last thing I would be doing. And you are probably right when you say soros himself probably never even heard of click. Its all going to depend on guidance going forward. They need a couple good quarters of growing sales AND growing earnings. and we could be in the double digits again. They just are not executing well.

 
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