Most of us are not familiar with Terrence Laundry’s T-Theory, which is a method of analyzing general investment trends using a time symmetry property. It basically states that the duration over which investors can obtain “superior equity returns” will always be equal to the previous time period in which returns were subnormal. The practical purpose of the theory is to anticipate the runs of “superior returns”.
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We uploaded our most recent quarterly client letter.
RMHI is pleased to announce year to date returns as of June 30, 2012:
RMHI Moderate Growth +13.58%
RMHI Long Term Growth +19.35%
S&P 500 +8.4%
Results were derived from the proprietary RMHI investment model. These results are not hypothetical but are real returns for RMHI accounts.
As always, returns are net of all fees and expenses.
I have sold all shares of Sun Healthcare for RMHI clients today at $8.40. No sense taking any risk with the buyout at $8.50. No further purchases at this time. Yesterdays sell off killed a great deal of the momentum that could have led to a significant upside breakout for the markets. We need another dose of time to let the markets heal.
Have a great weekend
I’ve been traveling the past two weeks and have made little posts in the intervening time period but this morning comes news worthy of sharing.
During the past two weeks market strength and stability began to reappear and I began reversing my cautious stance in favor of a more bullish profile. Over the past three weeks I’ve added a handful of positions but the stock that ranked the highest in my most demanding and best performing model was Sun Healthcare symbol SUNH.
SUNH is an operator of nursing and rehabilitation hospitals and care facilities.
As of last night SUNH was our largest position in client portfolios with an average price in the range of $5 to $6 a share. Today comes the news that Genesis Healthcare will buy Sun Healthcare for $8.50 a share, a whopping 43% premium to yesterdays closing price.
We have coyote puppies. A neighbor called us this morning informing us that on a part of our land that we don’t often see we have a pack of coyote puppies living in a culvert. We took precautions this morning to make sure the pups were inaccessible to our Akbash on patrol. They deserve their chance for a life and a night isn’t complete in the Rockies without the yipping and howling of coyotes at night.