Last month in Episode 80 of the video-cast titled ‘Thematic Investing’ I broke down some of the event-driven playbook that I was running into the rate cut and some of those names included: $RKT ( ▲ 1.69% ) $HOUS ( ▼ 0.97% ) $RMAX ( ▲ 0.1% ) $CCL ( ▲ 2.51% ) $SOFI ( ▲ 0.6% ) $KBH ( ▼ 0.05% ) $DHI ( ▲ 0.68% ).

One of those names, $HOUS ( ▼ 0.97% ) is now up +90% from my entry price with the merger deal with Compass realty yesterday.

The deal is valued $1.6B which is a +90% premium from last weeks close and this is just the start of the return of event-driven investing - and I said this last year in Episode 44 of the video cast.

This is a big deal for the real-estate industry but at large it’s just the start of the inflection for real-estate and housing which I’ve discussed at length the last year or so and how we were playing it through the fund.

I talked about this on Episode 80 titled ‘Thematic Investing’ and I broke down the narrative that I was seeing the last few months that investors are always too concerned with calling market tops, worrying about economic data that never generates trades ideas and generally pessimistic.

(If you click to watch it starts at the point where I break that exact thing down)

Instead (and you could and should listen for yourself) I explained the idea of thematic investing and $HOUS ( ▼ 0.97% ) made it into that discussion.

Because of that I have now made myself and my investors +90% in just over a month from this deal and likely more with the calls that I exercised.

The Investment

Each $HOUS ( ▼ 0.97% ) share will convert to 1.436 shares of $COMP ( ▼ 1.58% ) common stock, equating to ~$13.01 per $HOUS ( ▼ 0.97% ).

The name is trading lower than the estimated deal price but that’s fine, it will trade near that when we close and that represents just over a +100% IRR.

If you took the time to watch the video above where I discuss this basket of real-estate names we put together then you’ll hear the why behind it. What you don’t hear me doing is putting on the doom and gloom blinders and thinking that everything in the world has to be:

We run a repeatable, systematic approach to portfolio management.

I don’t care if the $SPX ( ▼ 0.05% ) is up 10% from here or down 10% from here - it makes zero difference in our investment approach. We want to focus our time on generating actionable investment ideas and filtering out the noise that most retail investors seemingly deal with and can never escape.

Now, I had no idea this buyout would happen but even without that the position was up +30% from the entry already and that’s better than a stick in the eye.

Conclusion

This was a great investment for myself and my investors as well as those of you that subscribe to The PDF report and all just in under a months time.

There should still be plenty of idea flow from the real-estate sector just not in the ways I think people expect which we’ve talked about in the report.

Congrats to all of you that invested into this and cashed in!

Dan