SPACs

Research
1

Does anyone know how to screen for SPACs?

Thanks!

2

I broached the subject once on this thread, but I’ve never found a sure fire way to successfully screen for them.

https://www.portfolio123.com/mvnforum/viewthread_thread,9547_offset,10

Ive been keeping handful in a custom list as I come across them, but I admit it’s not very comprehensive and I’ve not added any in a while…

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3

Marco, Yuval?

Thanks!

4

There’s no way to reliably detect them with the data that we have. Sorry.

5

This thread from 2020 was asking on how to screen SPACs/blank cheque companies, and the answer was no at the time. Any change, or workarounds?

Thanks,
Ryan

6

RBICS(30201020) and Between(Price,3,17) and PctDev(100,1) < 6 should approximate it. That might include a few former SPACs as well. If you don’t mind missing a few outliers like DWAC, you could narrow the price range closer to 10 and lower the PctDev closer to 1.

If you’re looking for stocks that once were SPACs but have since become regular companies, use that formula within FHist and use however many weeks you want to go back in the company’s history.

7

Thanks Yuval. I was toying with RBICS 30201020 as well, majority are SPACs.

FWIW, this group seems to be doing quite well the last 3-6 months. While I haven’t followed SPACs, the headlines generally claim these to be the speculative asset class due for a reckoning. As it turns out, not only does this group currently have the highest proportion of 52 week highs, but their 3-6 month return (and volatility) is significantly better than the broader market. Interesting…

8

The price of a SPAC before an acquisition will always be around $10. When the rest of the market is tanking, SPACs are like cash in the bank–low volatility, 3% return–which is significantly better than most stocks. That doesn’t mean that they’re a better investment than cash. Basically, buying a SPAC is like putting $10 in the bank for two years. If the SPAC doesn’t complete a merger, you get your money back, with interest. If you don’t like the company it merges with, you can also get your $10 back (with interest). If you do like the company it merges with, then you can take your chances and see what happens when the market reprices the stock. Lately, SPACs have gone way down post-merger. Check out this screen, which looks for stocks that were SPACs a year ago and are now in some other subindustry: https://www.portfolio123.com/app/screen/summary/275209?mt=1. Run the screen, choose the Price & Volume predefined report, and look at the Pr52WRel%Chg column. Yikes. 13 out of 83 SPACs have outperformed post-merger.

9

Very cool Yuval, nice summary of SPACs. Thx.