JPMorgan Cazenove reports that Foresight Forestry FSF has “ raised gross proceeds of £130m through its initial public offering of ordinary shares at 100pps. This is lower than the £200m target set out in the IPO prospectus. The shares are due to commence trading on 24/11/21 under the ticker FSF.”
Given that equally new funds such as the Life Sciences REIT raised MORE money than they had planned, this is something of a surprise/disappointment. I thought that the Foresight fund will play well with private investors, especially given Foresight’s money-raising prowess. Then again, let’s be honest – as I have already noted on this blog, the track record of listed forestry funds hasn’t been stellar (to put it mildly). I’d also be concerned that £130m is sub-scale – the new ‘minimum’ seems not to be £250m but £500m! Yikes.
Maybe Foresight would have been better off launching a uranium/nuclear fund.
With a hat tip to Nick Lawson, it seems that the Canadian listed fund from Sprott – their Physical Uranium Trust- has now filed an amendment to its base shelf prospectus, increasing the size of its ATM to US$3.5 billion, from US$1.3 billion previously (+US$2.2 billion). The original prospectus was for US$300 million.
That makes the new AuM 11x times the original raise !!! Talk about popular….
John Authors at Bloomberg has a fantastic letter out yesterday looking at a huge new historical database from Robeco and a bunch of academics.
The big reveal is that we now have data on different ‘factors’ or ‘equity styles’ right through to the Victorian era.
Here’s the quick summary:
“ This new paper studies a cross section of stock returns using a novel constructed database of U.S. stocks covering 61 years of additional and independent data. The database contains data on stock prices, dividends and hand-collected market capitalizations for 1,488 major stocks between 1866-1926. Results over this ‘pre-CRSP’ era reveal a flat relation between market beta and returns, an insignificant size premium, and significant momentum, value and low-risk premiums that are of similar size over the post-1926 period.”
As Author rightly observes
“People will always be excited by stocks with momentum, and they will always be scared enough of companies that are out of favor to leave them offering compelling value for those who want to take it. This is true even if it takes much more effort than a mouse-click to buy or sell a stock. “
The paper is by Guido Baltussen, Bart Van Vliet and Pim Van Vliet at Robeco, in collaboration with Erasmus University of Rotterdam. You can also access the paper here: The Cross-Section of Stock Returns before 1926 (and beyond) by Guido Baltussen, Bart van Vliet, Pim van Vliet :: SSRN
As Robeco notes: the findings are clear: value, momentum and low-risk are very robust and attractive factors, as shown in the figures below