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"You should expect the unexpected in this business; expect the extreme" Richard Dennis

August 25, 2014

Handcuffed

Shared below is a chart of Russell 2000 volatility.  Is volatility about to pick up again?  We'll know soon.



Maybe it's time for the Russell to start fading here.  Maybe not.  The lower trend line has been a good spot for small cap investors to back away all year.  Perhaps it's only a temporary bounce.

Patience is priceless.  Summer is almost gone.  Enjoy your week!   

August 21, 2014

The Unbelievable

The exponential growth in technology is continuously allowing more and more rapid shifts to occur in the marketplace.  Whether it's solar panels, DNA sequencing or whatever; the precedent is set for far fetched scale-able technologies to become near term realities.

"Over the past 13 years the cost of sequencing DNA has dropped 1,000 times more than Moore’s Law, from $100 million per human genome to only $1,000"

Ilumina has absolutely changed the gene sequencing game since their inception in 1998.  Who saw this coming 10 years ago?  You can find the rest of the Forbes story here.

Naturally the stock has been incredible over the past few years.  Looking at the chart, this thing doesn't look close to finished.  It appears to be forming an infamous cup with handle pattern looking for a move to the mid 200's if it breaks to new highs.  



  Trade 'em well!

August 19, 2014

EXAS; real promise or too good to be true?

I'm a firm believer that the best investments come from companies with things that change our lives.  In that context, often times I think of the iphone or the keurig coffee maker, but of course it's not limited to that.

Exact Sciences has come up with a way to detect colon cancer without the major turn-off that is a colonolscopy.  They simply screen the DNA in your stool with an efficacy rate of cancer detection in the same ballpark as doctors performing those dreaded procedures.  We must note that the detection is much lower for pre-cancerous polyps, which could be a deal breaker.  However, isn't is safe to assume this technology will improve dramatically over time?

How does this change things?  Well roughly half of the folks who should regularly screen for colon cancer don't.  If this was another quick part of one's physical, it's easy to see why more folks would do it.

At this point it seems clear it will recieve FDA approval, but how will it be received by the insurers and payment plans?  It certainly appears like it will save everybody money and lives at the same time.

Looking at the chart we can see it's just now taking out all time highs from the early 2000's.  Another major positive is the volume expansion that continues from 2010.

Charts can act very funny in biotech because so much depends on the FDA, but if this is for real there's little reason to think it can't triple and then some over the next couple of years.


Disclosure:  I'm long

Trade 'em well!

Reminder:

All ideas shown on this blog represent the authors opinion based on the data available.
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