Founder & CEO Bond Angle, LLC, Bond Angle, LLC

Vicki Bryan

Founder & CEO Bond Angle, LLC

Bond Angle, LLC

Insightful commentary and analysis on bond markets and market movers, including financial, economic, and industry catalysts and management shenanigans. 

High yield market investment research

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<a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a> was revealed on Friday as the massive NASDAQ whale helping to drive unprecedented option volume in recent weeks with its multi-billion dollar call-buying spree in the biggest tech names, as reported by <a href="https://www.ft.com/content/75587aa6-1f1f-4e9d-b334-3ff866753fa2" target="_blank" rel="noopener">Financial Times</a> and <a href="https://www.wsj.com/articles/softbanks-bet-on-tech-giants-fueled-powerful-market-rally-11599232205" target="_blank" rel="noopener">The Wall Street Journal</a> which confirmed speculation Thursday by <a href="https://www.zerohedge.com/markets/speculation-emerges-over-identity-mystery-marketwide-call-buyer" target="_blank" rel="noopener">Zero Hedge</a>.Softbank's option trades added to $40 billion in call-buying over the past month traced to retail investors. The resulting frenzy netted Softbank <a href="https://www.ft.com/content/53aa19bb-fc9a-46fd-aafd-4bc3669ab161" target="_blank" rel="noopener">$4 billion in option trading gains—on paper—</a>on its own <a href="https://www.wsj.com/articles/softbanks-bet-on-tech-giants-fueled-powerful-market-rally-11599232205" target="_blank" rel="noopener">$50 billion notional exposure</a>. By comparison, Softbank's newly acquired long positions in <a href="https://www.smartkarma.com/entities/amazon-com-inc" target="_blank" data-smartkarma-citation="entities:409:1" rel="noopener">Amazon.com Inc (AMZN US)</a>, <a href="https://www.smartkarma.com/entities/alphabet-inc-cl-c" target="_blank" data-smartkarma-citation="entities:11369:1" rel="noopener">Alphabet Inc Cl C (GOOG US)</a>, <a href="https://www.smartkarma.com/entities/microsoft-corp" target="_blank" data-smartkarma-citation="entities:15273:1" rel="noopener">Microsoft Corp (MSFT US)</a>,  and <a href="https://www.smartkarma.com/entities/tesla-motors-inc" target="_blank" data-smartkarma-citation="entities:20279:1" rel="noopener">Tesla Motors (TSLA US)</a> are worth just <a href="https://www.ft.com/content/3eec59a3-cb51-487c-aacd-68a0c7e46f2f" target="_blank" rel="noopener">$2 billion</a>, almost all that's left of the $10 billion Softbank spent late in the June quarter buying and selling mostly tech stocks at heady prices. Those holdings now are also subject to sharp declines triggered when Softbank's option scheme was revealed. Sure enough, Softbank <a href="https://www.ft.com/content/9e5827e9-893a-453e-b28d-88c1c0adc9d5" target="_blank" rel="noopener">lost $9 billion in market value</a> on Monday.There's plenty of intense scrutiny underway to understand these trades and what their impact ultimately proves to be. I'm more interested in Softbank's drastic change in strategy and its alternative deployment of cash from $40 billion raised in stock fire sales forced by its wary banks and legacy mega-investors who cut him and Softbank off after decades of seemingly endless billions in available funding when his recklessness netted Softbank and Vision Fund tens of billions of dollars in record losses. This certainly is not what Softbank told investors to expect mere weeks ago.Instead, Softbank's actions signal arrogance, or desperation, or worse—that CEO Masayoshi Son feels unrestrained and back in his Star Wars Zone with $40 billion in fresh cash.<div class="content-highlight">Read on for a Bond Angle deep dive into the belly of Softbank, The Whale, and what Son feels free to do with its $40 billion in cash that was pledged to bolster Softbank's bloodied balance sheet.</div>

Softbank Group (9984 JP) was revealed on Friday as the massive NASDAQ whale helping to drive unprecedented option volume in recent weeks with its multi-billion dollar call-buying spree in the biggest tech names, as reported by Financial Times and The Wall Street Journal which confirmed speculation Thursday by Zero Hedge.Softbank's option trades added to $40 billion in call-buying over the past month traced to retail investors. The resulting frenzy netted Softbank $4 billion in option trading gains—on paper—on its own $50 billion notional exposure. By comparison, Softbank's newly acquired long positions in Amazon.com Inc (AMZN US), Alphabet Inc Cl C (GOOG US), Microsoft Corp (MSFT US),  and Tesla Motors (TSLA US) are worth just $2 billion, almost all that's left of the $10 billion Softbank spent late in the June quarter buying and selling mostly tech stocks at heady prices. Those holdings now are also subject to sharp declines triggered when Softbank's option scheme was revealed. Sure enough, Softbank lost $9 billion in market value on Monday.There's plenty of intense scrutiny underway to understand these trades and what their impact ultimately proves to be. I'm more interested in Softbank's drastic change in strategy and its alternative deployment of cash from $40 billion raised in stock fire sales forced by its wary banks and legacy mega-investors who cut him and Softbank off after decades of seemingly endless billions in available funding when his recklessness netted Softbank and Vision Fund tens of billions of dollars in record losses. This certainly is not what Softbank told investors to expect mere weeks ago.Instead, Softbank's actions signal arrogance, or desperation, or worse—that CEO Masayoshi Son feels unrestrained and back in his Star Wars Zone with $40 billion in fresh cash.Read on for a Bond Angle deep dive into the belly of Softbank, The Whale, and what Son feels free to do with its $40 billion in cash that was pledged to bolster Softbank's bloodied balance sheet.

Softbank's Son "Feeling The Force" With Options Funded With Cash It Had Pledged To Protect

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<div class="content-highlight">
JFrog is getting ready to complete its IPO in the U.S. stock market in the coming weeks. Although JFrog is a smaller company than Palantir or Snowflake, JFrog has numerous characteristics of a successful IPO including significant sales growth and eye-catching improvement in operating margins. The company turned operating profit positive in 2Q 2020. 
Founded in Israel in 2008 (now headquartered in Sunnyvale, CA), JFrog's core software products allow companies to regularly update their software. The company has developed 'liquid software' that allows users to implement routine updating of their software, instead of the companies themselves initiating these software updates. With JFrog's product, the software updates are completed automatically without them even knowing.
</div>
There are numerous software IPOs that are coming up in the U.S. in the next few weeks. Although we do not have the pricing data yet, among the upcoming IPOs, Snowflake, Unity Software, and JFrog are among the most promising IPOs.


JFrog is getting ready to complete its IPO in the U.S. stock market in the coming weeks. Although JFrog is a smaller company than Palantir or Snowflake, JFrog has numerous characteristics of a successful IPO including significant sales growth and eye-catching improvement in operating margins. The company turned operating profit positive in 2Q 2020. 
Founded in Israel in 2008 (now headquartered in Sunnyvale, CA), JFrog's core software products allow companies to regularly update their software. The company has developed 'liquid software' that allows users to implement routine updating of their software, instead of the companies themselves initiating these software updates. With JFrog's product, the software updates are completed automatically without them even knowing.

There are numerous software IPOs that are coming up in the U.S. in the next few weeks. Although we do not have the pricing data yet, among the upcoming IPOs, Snowflake, Unity Software, and JFrog are among the most promising IPOs. 

TMT & Consumer Independent Equity Research Analyst, Obex Capital Research

Aaron Gabin

TMT & Consumer Independent Equity Research Analyst

TMT & Consumer Independent Equity Research

Obex Capital Research

“Obex” is Latin for Barriers to Entry. Obex Capital Management’s investment philosophy is driven by an intense focus on which business model’s Barriers to Entry are able to withstand the ever increasing competitive disruption in the TMT and Consumer Sectors.

Equity Bottom-Up

<div>Lots of interesting things stood out this week. Chief among them is that valuation has its limits...even for Apple and Tesla.</div><div><div class="content-highlight">Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to differentiate between fundamental business analysis and security analysis. Before deciding if a security’s pricing and positioning merit a long or short position, we analyze the four pillars of business fundamentals (Secular Factors, TAM, Competitive Advantage, Business Model) in order to determine if this is a “good” or “not so good” opportunity.</div></div>

Lots of interesting things stood out this week. Chief among them is that valuation has its limits...even for Apple and Tesla.Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to differentiate between fundamental business analysis and security analysis. Before deciding if a security’s pricing and positioning merit a long or short position, we analyze the four pillars of business fundamentals (Secular Factors, TAM, Competitive Advantage, Business Model) in order to determine if this is a “good” or “not so good” opportunity.

TMT Weekly:  3 Things that Stood Out The Week of 9/4/​​​​2020

Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Event-Driven

<ul>
<li>In our previous insights, we discussed TikTok’s potential sale of its business in the United States, Canada, Australia and New Zealand to Microsoft and its India business to Reliance Industries. In a new turn of events, on 27th August 2020, Walmart announced that it intends to partner with Microsoft in bidding for TikTok.</li>
<li>Several news media have reported that prior to partnering with Microsoft, Walmart was part of a consortium which included Alphabet (Google’s parent) and SoftBank, to bid for TikTok.</li>
<li>A deal with TikTok would benefit Walmart’s e-commerce, advertising business and help the company eventually become a strong competitor against Amazon.</li>
<li>Walmart’s share price has increased 7.4% to US$140.30 per share from US$130.68 per share on Wednesday’s close (26th August) following the earnings announcement.</li>
</ul>Read our previous insights on TikTok:<a href="https://www.smartkarma.com/insights/microsoft-tiktok-deal-could-be-a-strategic-fit-but-rumoured-deal-of-us-10-30bn-seems-overvalued" target="_blank" data-smartkarma-citation="insights:42112" rel="noopener">Microsoft: TikTok Deal Could Be a Strategic Fit but Rumoured Deal of US$10-30bn Seems Overvalued</a> <a href="https://www.smartkarma.com/insights/bytedance-tiktok-ban-in-india-casts-a-shadow-on-ipo" target="_blank" data-smartkarma-citation="insights:40907" rel="noopener">ByteDance: TikTok Ban in India Casts a Shadow on IPO</a> <a href="https://www.smartkarma.com/insights/reliance-tiktok-possible-realisation-of-mukesh-ambani-s-dream-of-a-technology-driven-company" target="_blank" data-smartkarma-citation="insights:42324" rel="noopener">Reliance-TikTok: Possible Realisation of Mukesh Ambani’s Dream of a Technology-Driven Company</a>


In our previous insights, we discussed TikTok’s potential sale of its business in the United States, Canada, Australia and New Zealand to Microsoft and its India business to Reliance Industries. In a new turn of events, on 27th August 2020, Walmart announced that it intends to partner with Microsoft in bidding for TikTok.
Several news media have reported that prior to partnering with Microsoft, Walmart was part of a consortium which included Alphabet (Google’s parent) and SoftBank, to bid for TikTok.
A deal with TikTok would benefit Walmart’s e-commerce, advertising business and help the company eventually become a strong competitor against Amazon.
Walmart’s share price has increased 7.4% to US$140.30 per share from US$130.68 per share on Wednesday’s close (26th August) following the earnings announcement.
Read our previous insights on TikTok:Microsoft: TikTok Deal Could Be a Strategic Fit but Rumoured Deal of US$10-30bn Seems Overvalued ByteDance: TikTok Ban in India Casts a Shadow on IPO Reliance-TikTok: Possible Realisation of Mukesh Ambani’s Dream of a Technology-Driven Company 

Walmart Enters as the Latest Bidder for TikTok: Can Walmart Overcome Retail Rivalry from Amazon?

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Quantitative Analysis

As Software companies look to become the key beneficiaries of a post-COVID world, we analyse allocations among active Global managers.  We find that holdings in Software companies have risen dramatically over the last 5-years, and have accelerated further through 2020. Over the last few months, Software has become the largest industry allocation among active global managers, surpassing Pharmaceuticals and Banks along the way.  Microsoft is the key holding and continues to attract new investment from the active funds in our analysis, though managers have also been raising stakes in the second tier, led by Salesforce, Intuit and Adobe.Taken from Copley's Global Research, comprising 405 Global equity funds, with combined AUM of $760bn.

As Software companies look to become the key beneficiaries of a post-COVID world, we analyse allocations among active Global managers.  We find that holdings in Software companies have risen dramatically over the last 5-years, and have accelerated further through 2020. Over the last few months, Software has become the largest industry allocation among active global managers, surpassing Pharmaceuticals and Banks along the way.  Microsoft is the key holding and continues to attract new investment from the active funds in our analysis, though managers have also been raising stakes in the second tier, led by Salesforce, Intuit and Adobe.Taken from Copley's Global Research, comprising 405 Global equity funds, with combined AUM of $760bn.

Global Active Equity:  Managers Ramp up Software Holdings

United States

Microsoft Corporation operates as a software company. The Company offers applications, extra cloud storage, and advanced security solutions. Microsoft serves customers worldwide.

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Microsoft Corp (MSFT US)

Softbank's Son "Feeling The Force" With Options Funded With Cash It Had Pledged To Protect

The market is eager to know what Softbank plans to do with a burgeoning war chest from bigger and bigger stock sales. The better question is why...

Vicki Bryan

JFrog IPO Preview

JFrog is getting ready to complete its IPO in the U.S. stock market in the coming weeks. Although JFrog is a smaller company than Palantir or...

Douglas Kim

TMT Weekly: 3 Things that Stood Out The Week of 9/4/2020

Lots of interesting things so Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to...

Aaron Gabin

Walmart Enters as the Latest Bidder for TikTok: Can Walmart Overcome Retail Rivalry from Amazon?

In our previous insights, we discussed TikTok’s potential sale of its business in the United States, Canada, Australia and New Zealand to...

Shifara Samsudeen, FCMA, CGMA

Global Active Equity: Managers Ramp up Software Holdings

As Software companies look to become the key beneficiaries of a post-COVID world, we analyse allocations among active Global managers. We find...

Steven Holden

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Softbank's Son "Feeling The Force" With Options Funded With Cash It Had Pledged To Protect

The market is eager to know what Softbank plans to do with a burgeoning war chest from bigger and bigger stock sales. The better question is why...

Vicki Bryan

JFrog IPO Preview

JFrog is getting ready to complete its IPO in the U.S. stock market in the coming weeks. Although JFrog is a smaller company than Palantir or...

Douglas Kim

TMT Weekly: 3 Things that Stood Out The Week of 9/4/​​​​2020

Lots of interesting things so Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to...

Aaron Gabin

Walmart Enters as the Latest Bidder for TikTok: Can Walmart Overcome Retail Rivalry from Amazon?

In our previous insights, we discussed TikTok’s potential sale of its business in the United States, Canada, Australia and New Zealand to...

Shifara Samsudeen, FCMA, CGMA

Global Active Equity: Managers Ramp up Software Holdings

As Software companies look to become the key beneficiaries of a post-COVID world, we analyse allocations among active Global managers. We find...

Steven Holden

TMT Weekly: 3 Things that Stood Out The Week of 9/4/2020