Opportunity: Canid Asset Management Targets Biotech - WNEM TV 5

Opportunity: Canid Asset Management Targets Biotech

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SOURCE Canid Asset Management LLC

Lee Levy's proprietary model signals value opportunities for investors

SAN FRANCISCO, May 21, 2014 /PRNewswire/ -- Canid Asset Management LLC, a Silicon Valley-based boutique asset management firm, is gearing up to add to their biotechnology holdings in their liquid long/short equity hedge fund, according to Founder and General Partner Lee Levy.  "Now is the ideal climate to incorporate biotech names into Canid's existing portfolio of 40 or-so diverse positions, because there is a surplus of value opportunities in this sector on which to capitalize," according to Levy.

Canid Asset Management is a leading San Francisco-based boutique value hedge fund offering a broad range of wealth management solutions. Launched in 2009, Canid is a young fund that successfully manages a liquid long/short equity portfolio specializing in protecting investor capital during highly volatile markets using quantitative, fundamental & tactical investment approaches hedged with sophisticated option strategies. The firm posted 2013 returns 2000 bps greater than Hedge Fund Indices. In addition to the Fund, Canid Asset Management also manages separate accounts.  Contact Leelevy@canidasset.com for more information.

"Harsh market sell-offs create great opportunities for us, since many sellers become economically irrational and sell stocks due to the 'fear' instinct. Investors have fear of their stocks dropping further, rather than thinking "this stock is trading at a better value than where it was, so I should buy more."

Levy observed this phenomenon at the end of March, when his proprietary model signaled specific biotech stocks as strong buys. Since then, those stocks have climbed an average of 12% versus a decline of 7% for the Russell 2000. Levy is currently sifting through the wreckage of the post-early April sell-off to identify new stocks for his portfolio.

Exposure to Lee's picks fits nicely into his contrarian strategy of choosing out-of-favor stocks with low price-to-earnings ratios. Case in point: One stock has a P/E ratio less than 10%, with a 2.2% dividend yield and price-to-cash flow ratio of 8%, and another pick has a price-to-book ratio of 1.85, with a 2.8% dividend yield.

Mitigating Risk

Since Canid's 2009 inception, Levy has overlayed a robust risk management mechanism into his bottoms-up model-a strategy which has helped the firm post 2013 returns that were 2000 basis points greater than the hedge fund indices. Levy continues to maintain his long-term aim of capturing upswings in healthy markets, while incorporating substantial downside protection in downturns. His model showed true efficacy during the height of the 2008 economic crisis, when investor losses under Levy's management were less than 4.98%, versus benchmark losses of 20% to 40%.

About Canid Asset Management LLC

Canid Asset Management LLC is a San Francisco-based boutique value hedge fund offering a broad range of wealth management solutions. Launched in 2009, Canid is a young fund that successfully manages a liquid long/short equity portfolio specializing in protecting investor capital during highly volatile markets using quantitative, fundamental & tactical investment approaches hedged with sophisticated option strategies. The firm posted 2013 returns 2000 bps greater than Hedge Fund Indices. In addition to the Fund, Canid Asset Management also manages separate accounts. For more information, please visit www.canidasset.com or contact Lee Levy at leelevy@canidasset.com.

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