Facts on SPACs | New SEC Rules? | with Stanford’s Michael Klausner
Like CCIV, NGA, ACTC, STPK, or HZON? We chat with Michael Klausner from Standford University about his research on SPACs. He also weighs in on the new announcements made by the SEC. Timestamps and a link to his research below.
1:16 (Research Findings) The general consensus among investors that I chat with is that it is unwise to hold SPACs through their merger. Mr. Klausner’s research presented some interesting perspective around that idea. He shares some highlights from that research and summarizes his opinion on optimal trade behavior.
Article: https://corpgov.law.harvard.edu/2020/11/19/a-sober-look-at-spacs/
4:17 (Are Investors More Skeptical?) A brief answer to that question. Are investors learning from SPAC trends and being more shrewd when evaluating them?
4:48 (Positive Traits in a SPAC) Mr. Klausner talks about the kinds of traits and behaviors that he looks for when evaluating a SPAC. Mainly, it is about share dilution and how big the sponsor’s cut is or will be.
7:38 (Where to Start your Due Diligence) A bit more on what he thinks you should be paying attention to in a SPAC. “I would spend less time on the company (merger target) and more time on the dilution.”
8:42 (New SEC Announcement) More and more news articles are pointing to the idea that SPACs will be under more scrutiny. More than $100 billion worth of SPACs have been formed in Q1 of this year, which is greater than the entirety of 2020.
We produce videos and content to share the perspective of different investors. No video we produce is designed to be direct investing advice, and the investing opinions of our guests are their own. Invest at your own risk. Do your due diligence.
