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Client Talking Points

Cover Up And Buy

Our Q1 2013 Global Macro Themes call was yesterday and we’re pleased that our subscribers and Twitter followers enjoyed what we had to say. Our three themes - #GrowthStabilizing, #HousingsHammer and #QuadrillYen - are all key pieces of solving the global macro puzzle. With the market moving up, we covered our Metals (XME) and Phillip Morris (PM) shorts and bought Apple (AAPL) and Singapore (EWS). The Apple trade is one we really like. The media twirls itself into such a frenzy over newsflow that it fails to see the bigger picture. We bought on red and like Apple in the range of $492 to $518 a share. 

Asset Allocation

CASH 46% US EQUITIES 18%
INTL EQUITIES 18% COMMODITIES 0%
FIXED INCOME 0% INTL CURRENCIES 18%

Top Long Ideas

Company Ticker Sector Duration
ASCA

We believe ASCA will receive a higher bid from another gaming competitor. Our valuation puts ASCA’s worth closer to $40.

ADM

ADM has significantly lagged the overall market in 2012 over concerns that weakness in the company’s bioproducts (ethanol) and merchandise and handling segment will persist. Ethanol margins suffered from higher corn costs, as well as weak domestic demand and low capacity utilization across the industry. Merchandising and handling results were at the mercy of a smaller U.S. corn harvest. Both segments could be in a position to rebound as we move into 2013 and a new crop goes into the ground. With corn prices remaining at elevated levels, the incentive to plant corn certainly exists, and we expect that we will see corn planted fencepost to fencepost.

HOLX

HOLX remains one of our favorite longer-term fundamental growth companies given growing penetration of its 3D Tomo platform and high leverage to the 2014 Insurance Expansion from the Affordable Care Act.

Three for the Road

TWEET OF THE DAY

“Goldman really cut comp big time in 4Q. It was just 21% of revenue, about half of what the firm usually pays people. $GS” -@LaurenLaCapra

QUOTE OF THE DAY

“All things are difficult before they are easy.” -Dr. Thomas Fuller

STAT OF THE DAY

U.S. consumer price index remain unchanged in December, unadjusted CPI index at 229.601