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Sold half the position in Gravity Ltd. (GRVY)

February 21, 2012

Shares in Gravity have levitated over the past several weeks and have now reached our price target. Given the current momentum before results of the open beta test for Ragnarok 2, scheduled to begin tomorrow, we have opted to sell only 50% of our position at just over $3.00 an ADR. Our original investment thesis was based on a market price below net cash. The market price is now substantially above net cash and incorporates a certain level of anticipated success for Ragnarok 2, thus it is time to reduce our position.

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From → Positions Closed

3 Comments
  1. Good job on sticking to your investment thesis. Your selling principle is excellent.

  2. Thanks, Jae. If I remember correctly, I think I have to credit you with bringing this investment idea to my attention.

    I was actually hoping the recent swoon in GRVY’s ADR price would allow me to re-enter the position at below net cash. Alas, the swoon was a momentary thing, at least so far.

    Regarding selling discipline, I’ll never forget what Walter Schloss answered when someone asked him whether he ever regretted exiting positions too soon. He said that his record was built on the dicipline of buying when shares were cheap and selling when they reached full value. Even if ther share price went up 10x after he sold he never regretted selling, he was simply content to implement his strategy [and reap 20% annual returns]. It was the discipline, he felt, that was the only reason he was able to achieve these consistent returns.

  3. Richard permalink

    They reached full value? You sure on that? You mean YOUR “net-net” value!

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