From The Fund Manager
What an amazing week in the markets we have seen!
The weekend started us off reasonably slowly, but then both ETH and BTC fell off the edge and Mintie got into gear. Most of the week’s profits were from five points in the market comprising of three short moves (one of which was a double short) and two long trades (also with one of them a double). All in all, you can’t ask for better than these sorts of crazy weeks, my only real concern being that a crypto price drop like this can shake confidence in crypto assets and blockchain technologies. So, I would love to see some type of recovery soon -- And we will trade that too!
Image source: Trading View
We had a great meeting this week with an Australian based company around getting them to do our audit, and they have given us an indicated targeted deadline of the end of December! (I know, how good are Aussies, right?) Now you might be asking as you read this: “I thought you were already engaging a European company to do the audit?”, and you’d be right to be asking, because we had.
Previously, one of our investors had put us in contact with a European based company that advised us that they could undertake the audit, which of course we were very thankful for, as we had had so many dead-ends that it was a breath of fresh air just to have some positive progress in way of the audit. The European firm was in fact a fund themselves (which in itself is completely fine), but as we progressed in our discussion with them, it was not going to be done in collaboration with licenced accountants or auditors in any way, but they were happy to still do the audit for us. Now, I have no doubt they have the required skills to conduct the audit, but we were concerned that it would not get us the level of assurance required of our investors. For now, we have put our discussions with the European firm on hold.
Over the last 2 weeks, an Adelaide based investor got us in touch with a licenced firm (also in Adelaide) for some unrelated work to do with our upcoming new project and within discussions around that, we found that they are able to also help us with the audit. Hallelujah! It all seems so perfect too, as we are based locally to them and so there are no time-zone or language barriers slowing anything down. Not to mention that they expressed a lot of interest in what we do and in our upcoming project also. Hopefully, they will prove to be a very valuable connection going forward.
Testing the additions to the algorithm has been a long and somewhat repetitive experience, but the results are looking very good indeed and I will try to have it all done soon, so I can share the results and we can carefully bring in the changes. There has been a lot of excitement around this and I am beginning to feel confident the results won’t disappoint.
The new office is also coming along well. We are just waiting on the landlord changing the carpets and then we can get Wisper Connect in there to set up all our essential equipment for us to move in. We are excited for the move, as it is both practically important and symbolic of our growth, especially with the new project on the horizon.
Thank you to all investors for the feedback around our decision to not on sell tokens from the buyback treasury. The positive response helps bolster the view that we are managing that aspect correctly to the benefit of all of our investors in general.
We will leave it at that for this week. Thank you for taking the time out to read the report.
From the Countinghouse Team and myself, we would like to wish all our investors a safe and happy weekend. Make sure you take some time to do the important things, like spending time with your loved ones!
Market Activity Snapshot
Market Data Source: Thanks to @BazzWatkins
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).