FRMO is a bet on the jockeys: Murray Stahl and Steven Bregman. It's very hard to value since they carry pieces on the balance sheet at cost. I have a vague feeling that it's not cheap here, but I was interested enough to make it >2% position.
On the plus side, the Stahl and Bregman are major holders (I can't find how major offhand - their proxy does not list 5+% holders), they don't take any salary, they don't pay directors, they seem to be shareholder friendly.
On the negative side, Horizon Kinetics fund has not done well recently: they are trying to sell it as counter-correlated to SP500, but that's rather weak explanation. And as I said, the sum-of-parts valuation is hard and the company is likely overvalued based on it. They do get very interesting ideas once in a while though and it's possible that some of these ideas would blow up on the upside. It is basically an investment in something that is very uncorrelated to the market - wait, now I sound like them... :)
To summarize: if I was patient, I'd wait for much cheaper prices. But they might not materialize since most holders are likely to be long-term. OTOH you never know if/when someone decides to fold a major position into illiquid market, so you might get a chance.
Longer discussion at cornerofberkshireandfairfax.ca |
