SPAC Stocks Explained

Video Length 00:11:20


Good day, fellow investors there have been a lot of requests for me to analyse SPAC stocks, the special purpose acquisition vehicles that are flooding the market now. So due to my curiosity and I’m always interested also in what great value investors are doing. Because if we look at Seth Klarman portfolio of course, we have eBay that we discussed in video link for the video in the description of course, as always, because then this television assets, but one of the largest portfolio is PS H, which is Bill Ackman at Pershing Square tontitown holdings and new SPAC that we are going to discuss. So let’s immediately start with the definition then discuss pursuing as an example, then the general returns, why hedge funds like set garments are invested, which is not why you might be invested. That’s the key to understand before investing in these vehicles, what are the expected returns on what returns depend? And then also a general overview of what this means for the market? Let’s start so SPAC stocks are blank checks, companies. So you have a person in this case, Bill Ackman, he said, he’ll start a SPAC company five to 7 billion, and then you think your wife is a spender. Look at Bill Ackman five to 7 billion blank check that I can spend on whatever I want. This is a typical example of money printing that we have discussed, there is so much money in the environment. So if your bill, and you can get to five to 7 billion of other people’s money to invest in something, of course, you’re going to do that the companies are already public. So before they have invested into something else, they are public, and they are looking to invest into not listed companies. And by acquiring them, make them public, change that name and then develop them and grow them. And of course, make money is the ultimate goal. They can merge whatever, get the minority larger, whatever. Let’s do an example. And then you’ll see how it really works. If you enjoyed this, please click that like button. So as we said Pershing Square fontein Holdings five to 7 billion blank check acquisition company, what are they doing so they have taken the 5 billion and they want to make an acquisition with it. Bill Ackman extremely smart guy, we have discussed him in a few other videos. And I made the video somewhere in March 2018, or 19. If I’m not wrong, saying how you could invest with him with his company, you can check that now the stock has rebounded significantly. So it’s different now he’s hot, and he can get the money. Two years ago, everyone hated him. But I’m going to continue to follow him because he’s very smart, and hate love sentiment, we might find great buys of his when he’s hated again, and I’m sure given how investing is that he will be hated again in the future. So the business is to identify

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