From The Fund Manager
Week 6 was slower than usual, but I am pleased to state that the fund had still registered a positive result. This was primarily due to freezing of the fund a couple of times to process buybacks, which we will address below.
Over the week, we had a couple of our main team members out of action for medical reasons, and were running on a very small staff. We will also be looking to move into a larger office to accommodate our growing team, and because we have some very exciting projects coming up, which will be revealed over the next few months.
We are all looking forward to the new month ahead, and also the start of CHT being listed on LATOKEN; as far as other exchanges go, we are seeing some delays with talks of licences taking too long to go through.
Moving forward, as the fund and team grows, we will be setting a structure around our hours of availability, and provide an outline of realistic expectations around timeframes for incoming questions and requests. Thus far, we would like to thank everyone for their patience.
Back to the topic of buybacks – We have had a sudden burst of buy back requests this week. Current buy back requests should take all of next week to complete, and will total a little over 1.3M CHT tokens – most of this is from one very large ICO fiat investor, shifting their investment into our forex hedge fund. This will be a very large portion of the CHT fund and we are being careful as to not shrink the fund too early, causing it to increase risk to the point of fund fragility. Countinghouse will not allow our fund to get to that point, but we are being cautious as it is our job to look after the fund and protect it from such risks.
If you might not have already noticed on our webpage, we have temporarily put the fund into vesting while it recovers through trading profit. Over the next few weeks, we will design and announce a policy and procedure around buying back – to make it available for the right reasons and not jeopardise remaining investors or the fund at large. This of course does not prevent anyone from liquidating to market or from simply waiting for the vesting period to be lifted and the new policy to be in place.
In relation to fund reporting, we are still working towards building it to suit the needs of our investor community. Working in the crypto environment and with our new investor community has been a learning curve for us. We are happy to grow to fit the space, but we will always be checking that against the basic tenants of value to investors, and ensuring it also achieves what investors are requiring the reports to achieve.
Let’s keep pushing forward. For next week, most of the team will be back on and it will be business as usual.
Please take the time to review the report and thank you for your attention.
* Conversion rate used 1 ETH to USD $478.94
Market Activity Snapshot
Weighted Average: 0.005578750 ETH or USD$2.67 per CHT
Non-Weighted Average: 0.005578750 ETH or USD$2.67 per CHT
Valuation – Jae Jun Method
Fundamental value (sometimes referred to as intrinsic value) is a calculation to determine the actual value of a share, unit or in this case a token when looked at as an investment.
We have chosen the Jae Jun Intrinsic Value Formula. The main reason we like the Jae Jun is because it is one of the most conservative calculations there is.
Now we have kept to how this is traditionally used and that is to base it on a 10 year return, factoring in the yield reducing over time. We have also taken an extra step to be even more conservative on this calculation; Jae Jun reduced the ‘no growth PE ratio’ from 8.5 to 7 but due to the increased volatility in the crypto market we think it is more prudent to reduce this value all the way to 1 (this value operates as a multiplier in the calculation so reducing it to one is very significant in the results the formula we return).