WEEKLY REPORTApologies for this being late. The spreadsheet below DOES represent the status as of Sunday. I'll make a seperate post updating for the current situation (as it's changed significantly since Sunday - for the better). Some of the new in this relates to activity THIS week - seemed silly to make a new post for it. There's quite a bit of news this time (none of it bad) - so hopefully it was worth the wait.
We ended this week with a slight loss of NAV/U (down 1.22%). This was entirely due to a surge in the exchange-rate of LTC/BTC - if that were discounted then we'd have been looking at growth of just under 3.5%. As I always say when this happens, it's the sort of bad news I'd like to have every week - a small reduction in number of LTC/unit in return for a massive increase in the purchasing power of those LTC.
CIPHERMINEThis news actually applies to this week - but seems pointless to wait until the next report to mention it.
One of the things I frequently do is buy on IPOs then flip the shares for a profit. There are a few factors that absolutely MUST be in place for me to do this - and this one met all of the criteria comfortably (sorry for not listing them - but it obviously isn't something I want to give too much education on).
The first batch of 10,000 shares sold out very quickly at 0.67 each - with, as I'd expect, the bulk bought up by one person (7000+). We were second largest purchaser with 2000 of them. I flipped some of these at over 1.0 each before the second batch came out at 0.9 each - and replenished stock from that.
Generally when I buy on IPOs my intention is to flip fast for a reasonable markup - and I never mention it at all specifically in news. On this one I intend to hold a significant chunk longer - as I believe the share price growth has a LONG way to go upwards. Specifically I'll be looking to get rid of half of them at a reasonable markup (50%+) and hold the rest a bit longer for some more. Were it not for my caution in terms of exposure per asset I'd have grabbed a LOT more of these. Expect these to show up on long-term holdings in the next but one report (I won't be certain I'm holding them long-term until probably early next week).
When I post an updated current valuation after this post, about half the growth is from the trade we've already done in these this week - we've had some other decent trades as well.
S.DICE / S.BBETI've taken the decision to keep our exposure to these low (we need some exposure for the pass-throughs). There'll be no more end of week reports with 5000-10000 S.DICE held by the fund (above those needed to cover outstanding pass-through units).
WIth S.DICE there's a couple of reasons. Evorhees, the asset issuer, has appeared increasongly disinterested in the asset and increasingly keen to pass costs on to investors even where it's dubious whether the contract allows it. Just-Dice has emerged as, in my view, a very credible alternative to S.DICE for gamblers. S.DICE looks like having a good dividend this month - so I don't expect any sudden massive fall in its value - and it will almost certainly continue to have a good market-share of gambling. But I no longer have sufficient confidence it its price stability to maintain high exposure to it. Were we an investment fund then I MAY still hold it - but we aren't and what few longer term investments we hold need to be significantly more stable (and significantly more profitable) than S.DICE.
With S.BBET there's no sign of it gaining any traction. My view is that it targetted the wrong market from the start - gamblers who don't mind not getting defined odds. That market's tiny compared to the fixed-odds market. It may still end up doing well - but I'm not confident enough of that to carry significant exposure.
S.MPOE I have no problems maintaining larger exposure on. It's price continues to slowly grow and its model is such that profits are inevitable (though a pretty piss-poor ROI).
Just-DiceThis has emerged as a credible competitor to S.DICE - with a model allowing fast investment and divestment. I will be seeking clarification on withdrawal speed from it. If withdrawals are near-instant (other than confirms) then I'll use this to hold mobile BTC reserves rather than BTC-E. That's BTC that I hold ready to move where needed. We'd still have some BTC on BTC-E - backing LTC buys to rebalance currencies automatically if the exchange-rate moves - but the reserve portion (typically 25-50 BTC) would sit in Just-Dice earning profit. I would ONLY be depositing there what would otherwise sit inactive (and we HAVE to hold some totally idle BTC to allow fast movement when opportunities present themself). I would NOT be raising bond capital with the purpose of investing in Just-Dice - even if it made slightly more than we paid in interest (we won't know whether it does for a while) the CP risk would be unjustifiable for meagre returns.
This policy will incur no extra debt, generate some small additional profit and distribute our idle-capital risk between BTC-E and Just-Dice rather than having it all focussed on BTC-E. BTC in Just-Dice would be listed explicitly in weekly reports along with our other cash holdings.
If withdrawals aren't near-instant then this will NOT happen at all : I need to be able to withdraw from there to exchanges in the same way that I can from BTC-E at present.
SHARE-SPLITA motion to conduct a 100:1 split on LTC-ATF will be raised shortly after this is posted. This motion will be for two things to happen:
1. All outstanding units of LTC-ATF to be multiplied by 100 (the split itself).
2. The units authorised to be muliplied by 50 - increasing from 2500 to 125000.
Without number 2 we'd be in a situation where there were more units issued than were authorised - and where, without a contract modification, I couldn't correct that in any reasonable time-scale if we ever needed to sell more.
I'm confident I've easily proven that I have no propensity to sell units just for the sake of it - not only is it horrible practice but it harms me personally by diluting my own holdings. I've only ever sold units when there was a sound case to do so - and will continue doing so (heavy losses, massive fall of LTC vs BTC and massive increase in LTC-denominated investment/trading options remain the scenarios in which it would occur). By multiplying by 50 rather than 100 I still maintain the ability to sell more if needed - but actually halve the amount (in value) I can sell - so even if you don't trust my judgement I'd be reducing my ability.
No change to the contract is proposed - my ability to authorise (as opposed to issue) more units would be massively reduced but I don't believe that likely to be a problem.
The vote will run until midday Sunday and any split, if approved, would occur AFTER the next weekly report (and AFTER payment of any management fee). All market orders would be cleared during the process - so no need to be concerned if you have Bids up.
WEBSITEWork has commenced on a website that will cover all my investments (DMS and well as LTC-ATF) as well as being a general port for cypto-currency securities. Initially, at least, the majority of content will be written by me. A professional developer is doing all of the artistic/design/implementation work. All costs of this are (and will continue to be) paid by me personally.
This is still some time away from launch - at present the focus is on branding/logos/style issues - but my hope is that this will give far greater exposure to LTC-ATF and LTC-ATF's securities (and also to DMS of course). This, together with the share-split (if approved) willl hopefully add liquidity to LTC-ATF on the market as well as significantly raising the price at which it trades (with its strong historical results it could easily be trading a lot higher than it is - the high unit price and low visibility of LTC securities are, in my view, what has hampered this). That can only be good news for current investors - as would any increased activity on LTC-ATF's secondary securities (which I fully intend there to be more of).
LTC-ATF.B2In the next few days I intend to launch a second bond. This will be on BTC-TC and paying a lower rate than LTC-ATF.B1. As LTC-ATF can now get listing fees refunded, this becomes feasible.
No further capital would be raised via LTC-ATF.B1 (unless it proved impossible to do so on LTC-ATF.B2) but there would be no forced recall on LTC-ATF.B1 as that would be unfair on investors who bought it at well over face value. Voluntary sell-backs of LTC-ATF.B1 would gradually reduce the capital raised by it.
The advantages of it are:
1. Lower capital cost.
2. Easier maintenance for me - I can leave Asks and Bids up without having to worry about exchange-rate moves causing them to generate a loss for us.
I'd initially only be selling 50 BTC worth (we could use that now) and would issue more, as previously, when we either needed more capital or managed to buy-back LTC-ATF.B1
ODDS AND ENDSNo management fee and HWM remains unchanged (as we made a loss).
Will post Bid in a new post with update for current valuation.
