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The Contrarian Investor Podcast Posts

Season 2, Episode 22: Time to Build a Position in Semiconductor Manufacturers?

With Siddarth Singhai, Ironhold Capital

Siddarth Singhai of Ironhold Capital joins the podcast to discuss his views of semiconductor manufacturers and auto parts suppliers. He also shares his bullish views on industry sectors in his native India.

Content Segments:

  • Singhai’s look at the macro situation with COVID (3:27);
  • The cyclical nature of the semiconductor industry (5:59);
  • Long-term prospects are “fantastic,” and the macroeconomic environment should allow for the opportunity to build positions (8:06);
  • Electrical cars will provide a tailwind to auto manufacturers (10:40);
  • Background on the guest (13:52);
  • The most profitable industry in India (17:19);
  • Favorite ideas in semiconductor suppliers (27:04);
  • Favorite ideas in automotive suppliers (32:14).

More Information on the Guest:

  • Ironhold Capital is a value-based hedge fund in New York focused on leveraging both the Indian and U.S. markets. Its priority is to preserve capital, which is accomplished by buying high quality businesses with no leverage for cheap, followed by layers of risk management.
  • Website: IronholdCapital.com
  • YouTube Channel: Leaders in Business and Investing
  • Podcast: via Spotify and Apple Podcasts

Not intended as investment advice.

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Buy Your Tickets to Contrarian Investor Virtual Conference No. 3! Special Discount for Listeners

This podcast, in partnership with ValueWalk.com and Breakout Point, will host the third Contrarian Investor Virtual Conference on Tuesday, Aug. 11 at 9 a.m. EDT.

The event will last about two hours and feature exclusive stock picks from contrarian investors. It follows on the success of the first two events, which moved prices in a number of stocks. Read more about that here and here.

The organizers feel they have established a practical model of investing conferences for the COVID age. The key is to have the highest quality investment managers, keep the sessions brief, and focus on actionable ideas that have not been disseminated before. The performance of stock picks from the conferences bear this out: Ideas presented at the June 3 event returned 5.7% cumulatively through June 30, compared to -0.9% for the S&P 500 over the same period.

The keynote speaker’s idea, a short call on Hebron Technology Co. Ltd. (NASDAQ: HEBT), was even more profitable. The company’s shares dropped more than 23% after the presentation and at the time of this writing remain more than 30% below the all-time high set on the eve of the last event.

How it Works

Panelists will present one (1) fresh stock pick each. These ideas must be contrarian in nature to qualify. Presenters get up to 20 minutes to introduce their idea, including slide decks if necessary. They are then asked to talk through some details by Nathaniel Baker, host of the podcast. Finally, audience members can ask questions through the webinar’s interface. Presentation materials, video recording of the event and contact information will be made available to attendees.

Featuring the following presenters:

  • Gabriel Grego, Quintessential Capital Management. long idea
  • Anne Stevenson-Yang, J Capital Research: short idea
  • Bradley Safalow, PAA Research: TBD
  • Eric Chung, Lighthaven Capital Management: long idea
  • Vishal Bhutani, Pyrrho Capital Management: long idea

Order Tickets

Individual tickets can be purchased via eventbrite here.

Starting with this event a limited premium ticket option is available. This adds two monthly calls where participants can discuss the ideas from the conference as well as broader market activity in a more intimate setting with the three organizers. During these calls, participants will also receive insights and the latest trends on hedge funds and short selling from Breakout Point and ValueWalk research. The principals (Nathaniel, Ivan, Jacob) will be able to answer other questions relating to their work.

There is a special discount for listeners of this podcast: Add the promotional code “contrarianpod” (no “quote marks”) at checkout to receive an extra 10% off.

Ten percent (10%) of proceeds from this event will once again be donated to the CDC Foundation to help the emergency response to the coronavirus.

*tentative list. Names will be added shortly.

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Season 2, Episode 18, Transcribed: The Methods of a Short Activist, With Gabriel Grego

Moderator 0:02
Welcome to Contrarian Investor Podcast. We give voice to those who challenge the prevailing sentiment in global financial markets. This podcast is for informational purposes only. Nothing on this podcast should be taken as investment advice. guests were not compensated for a period, nor day supply payment in order to appear. Individuals on this podcast may hold positions in the securities that are discussed. This is our urge to educate themselves and make their own decisions. Now, here’s your host, Mr. Nathaniel E. Baker,

Nathaniel E. Baker 0:36
Gabriel Grego, Quintessential Capital Management. Thank you so much for joining this podcast. You are a short activist investor. There are probably few things more contrarian than being a short, especially nowadays when markets are rallying like crazy. You have a very specific process. And you only do a couple of trades a year, I think about three or four of these very high conviction trades. And you find these companies to short. And a lot of these have turned out to be outright frauds. And obviously, this approach has worked very well for you, as these stocks have traded down, in many cases to zero. So for you and your investors, obviously, this has worked out and so I’m very grateful that you have taken the time to come on this podcast.

Gabriel Grego 1:36
Thank you very much for having me. It’s a pleasure.

Nathaniel E. Baker 1:39
So yeah, so maybe start from the beginning. How does this — How does it start? Like, how do you go about locating these ideas?

Gabriel Grego 1:47
Well, I think the locating is one of the most important parts. And I think one of the reasons why I believe I have a high percentage of success as defined in terms of shorting companies that then end up going to zero within days or weeks is as much a matter of the selecting the right targets, as all doing the right type of research on the company. So it’s very important to find the right target, which inevitably entails rejecting a lot of a lot of good ideas, which for some reason or another are not good enough. So, what I chose to do at the beginning of this activity was basically to focus myself on what I called extreme corporate catastrophic situations, which typically means only looking at companies where there is total or almost total accounting fraud and/or where management is committing some kind of serious crime. And of course, this this situation must must be somehow hidden to the public and to the market. Otherwise, there is nothing to bet on. So the important thing is looking for this situation, which are by definition not easy to find, obviously, because management wants it wants to keep the situation hidden. And the key word here is flexibility and open mindedness. So you cannot stick to only one strategy or procedure to look for these kind of ideas because they’re very rare. And unless you have an open mind, you’re gonna have a very hard time finding them. So you need to use a combination of approaches. The most obvious approach is to come up with some kind of screening mechanism, like an automatic software say, that looks for companies which have certain red flags, that in my experience, and other investors’ experience have turned out more likely to have a risk of fraud.

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