4.28.2010

Distressed Debt Investors Club Update

Over the past few weeks I have received a number of emails on the status of the Distressed Debt Investors Club. And because I have not provided an update here for sometime, I thought I would take a few minutes to talk about the amazing success of the site.


As noted before, we have capped the limit of users to 250, with an unlimited number of guests. Currently, nearly half the member spots have been filled with well over 1000 guests logging onto the site. For reference, we are receiving 5-15 applications a week for full membership and admitting 2-4 of those same applications (this number has been declining as the number of available spots decreases). For those that are interested, I would encourage you to join as a guest member to see the quality of ideas on the site (when asked for idea synopsis / text just write in guest) For more information on applying, please read the FAQ.

In terms of ideas, we have well over 100 ideas fully written up on the site. The diversity of ideas is simply amazing. For example, in the past week we had a member write-up a long thesis on Visteon's equity and the same week another member wrote-up a short thesis on Visteon's equity and bonds. Ideas range from full blown Chapter 11 distressed, to stressed high yield investments, to event-driven equity longs, and finally to equity shorts. While I have not fully run the numbers, I would estimate that 90% of the ideas presented to the site have generated positive absolute returns.

One of the main reasons I set out to develop the site was to develop a platform where smart, dedicated analysts and portfolio managers could share ideas with one another to develop a culture of alpha generating security selection where all incentives were aligned. By joining, members have access to a plethora of actionable ideas and research, while at the same time adding to the collection of ideas through the application process. I have always been wary of sell side and desk analyst recommendations as you do not know if a broker or dealer is talking up an idea to move inventory. Here, each member realizes that XYZ member pitching ABC credit probably has a position, and thus can better judge the situation at hand. Further, because ideas are rated by the community of analysts and portfolio managers on the site, and each member's idea recommendation history can be easily pulled up, it is in every member's best interest to submit their best ideas on the site to avoid being labeled someone simply out to talk his or her book.

Finally, and what I have been most surprised about, is the success of our message board where members discuss ideas more informally and talk about general macroeconomic and thematic concepts (for example, there is a recent thread on the China real estate bubble and how to play it). We also have a job board which I am fully ramping in the next few months with the help of some outside partners.

Overall, I have to say the success of the site has fully exceeded my expectations. We continue to add features to the site and have a number of interesting developments in the pipeline. If you have any questions, please feel free to email me (hunter [at] distressed-debt-investing [dot] com). I hope to see you on the site soon.

4 comments:

Bruce Berger 4/29/2010  

I am assuming many of the readers exclusively invest in public securities. I purchase private distressed companies that are going concerns for liquidation value. I am looking for additional capital and was wondering if any readers are interested in investing and or learning how to fix companies hands on. My website is www.recapitalization-partners.com

sharleen Benet 5/03/2010  

Hi,

What a wonderful blog you have! I have completely enjoyed reading some of your posts as : http://www.distressed-debt-investing.com/ I have come across very few blogs with such nice information. Is there a way by which I could contribute with an article or link to your site?

Please do let me know.

Looking for your response

TP,  5/05/2010  

How come as a guest you can't view any attachments? Guests also can't see any of the tables, charts, etc. that are embedded in the articles...would be great if this could be changed. Thanks and keep up the good work.

Anonymous,  5/28/2010  

Hi Hunter,
I really appreciate the blog and the DDIC pitches. Great work!
As the previous poster said, could you allow guests to view attachments too as some members post the meat of their pitches in attachments?

Email

hunter [at] distressed-debt-investing [dot] com

About Me

I have spent the majority of my career as a value investor. For the past 8 years, I have worked on the buy side as a distressed debt and high yield investor.