David J La Placa, Founder | CEO's Picture

David J La Placa, Founder | CEO

Founder & CEO of Intellectus Partners, The Entrepreneurs Advisory I fervently believe that Integrity & Innovation are the two keys to success in business

San Francisco

19 posts

An important test for all markets

As we have been calling for since the end of last year, there is indeed regime change in the markets. Our point was that the framework of the interest rate deck has changed. The next several years will be different because of this. What it means obviously is yet to be determined. But what really strikes me when I look at this chart below is this: The beginning of this enviornment was when we were reeling from the crisis. Frankly, at the time most of the market participants thought we were still deeply IN it. That is when Mohammed El Erian coined the term "New Normal". It was my opinion that term was really a pejorative for "cant really grow anymore". Well, what this seems to

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A pro-cyclical correction and regime change

What is happening in the markets now. Change is sometimes uncomfortable. It’s been too long since we have had a correction, so one was due. We are off more than 5% from the recent high. A 5% correction is a must and needed event to take the speculators out. We typically get two corrections of this size per year. Interestingly, it has been over 400 days since we have had one. Good opportunities begin to present themselves upon these downlegs, but a 10% or more correction could clearly be in the cards given the extent of this previous move. That said, there is already quite a bit of consternation about this sell off and it did seem as though this was already feared. That usually

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Watch this new emerging trend.....

Crypto Currencies, Blockchain and the ICO Crypto currencies are a digital currency that uses encryption techniques to regulate the creation of currency and verify the transfer of funds, operating independently of any central bank. They are built on top of a Blockchain, which is a digital ledger in which transactions made in bitcoin or another cryptocurrency are recorded chronologically and publicly. While not exactly new, the Blockchain and Crypto currencies may be hitting critical mass and are now simultaneously upending multiple industries. They will eventually disrupt almost all industries. The ICO may be it's first "Killer App". The world of finance in particular is directly in it’s line of sight. Because token holders need only hold private keys to guarantee custody, it means that as

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Intellectus Continues to add specialty Advisory talent

We are proud to announce another significant addition to the Intellectus Team. Alice Wu, the former President of Robertson Stephens, Head of Asia Region has joined Intellectus. Alice will be based in our San Francisco office and will frequently be spending time in Asia. Please welcome Alice to the team! Our press release is below: Silicon Valley-based Independent Wealth Management Firm, Intellectus Partners, Hires Alice Wu as Head of Asia Pacific Region, Wealth Creation & Preservation NEW YORK, NY, June 20, 2017–Intellectus Partners today announced that the firm has expanded its leadership team with the addition of Alice Wu as Head of Asia Pacific Region, Wealth Creation & Preservation. Ms. Wu joins Intellectus Partners from Robertson Stephens where she was a Managing Director and President

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Buffet strikes again....AGAIN- an update

"If a capitalist had been present at Kitty Hawk back in the early 1900s, he should have shot Orville Wright." So said Warren Buffet in 2003. My how things change...Great investors are never dogmatic. As you may recall from our post three months ago(Nov 11, 2016), we have been unabashed bulls on the airline sector for a very long time. In a nutshell, we think capacity discipline and the rationalization of the US airline industry are driving significant efficiencies (not to mention the indirect benefit that they receive from all of the oil and gas that the US is pumping). This is likely to lead to real value creation In fact, we think it already is. Just last week, Delta announced that they were

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The coming rebound in IPO's in 2017

We expect that 2017 is setting up to be a year of heightened activity in Advanced technology, leading to a robust IPO market in 2017. A decade of repressive regulations, costs and other aftershocks of the dual crises(2000-02 & 08/09) have created a pressure valve set to burst. The mountain of regulations have kept fast growing private companies private longer and the money followed. Venture Capital, and in particular, late stage capital(growth funds) have allowed the companies plentiful access to massive funding without the public markets. Advances in innovation have been accelerating at an exponential rate, costs to develop have dropped by orders of magnitude and available pool of talent has dramatically increased. After a long run of activity, the confluence of mobility,

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Alternative Datasets

We are big fans of using all tools available to derive insights for our investment views. In particular, alternative datasets are increasingly valuable, available and differentiated. The advent of Artificial Intelligence on the Investment court has changed how things are done quite a bit. The various A.I. techniques are finding their way into the top trading and research desks of investment managers and advisors. From Natural Language Processing(NLP), to Machine Vision, Deep Learning and others, we are processing mass quantities of complex data via algorithms to better understand (and hopefully predict) our world. In light of our view of the immense value of these alternative data sets and the high growth companies that are creating this market, We thought that we would share an

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Let's chat: Dialogue increases Value in Advisory.

The Entrepreneurial Lifecycle: As the New Year turns. I wanted to touch base on the lifecycle that we all go through and how to optimize the benefits of working with an Advisory firm like Intellectus Partners. There is a difference between investment management and Wealth Management. There is an even bigger difference in advising Entrepreneurs and execs in high growth companies and non-entrepreneurs regarding their finances. Most often clients come to Intellectus Partners at or near an exit and expect the firm to just step in and work it’s “magic”. We can certainly help and add value at that point but wealth management for those in an entrepreneurial world ideally should line up temporally with their business lifecycle. When someone comes to us near their

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Buffet strikes again

As has been his unique habit, Warren Buffet's Berkshire Hathaway has taken an aggressive stake in an industry. Berkshire has filed their Q3 2016 13F filing today and among them was a particularly outstanding item. He has acquired large stakes in an airline, no make that "ALL" four major airline companies, or, the entire industry. Warren Buffet has acquired stakes ranging from $300mm to $1bb in value in each of the legacy carriers, American Air, Delta and United Continental. He also took a stake in Southwest. As we have been stating for quite awhile, the relatively rapid consolidation in the Airline industry, (Continental, Virgin are the latest two) has created a dynamic similar to what the railroad industry went through a decade ago. The consolidation of

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What now? Take a deep breath.....we have been here before

Now that the American electorate has spoken,it is time to sharpen our focus on how tho think through this political earthquake: A "Republican" mandate? Not like you think...It's more like an Independant and a Republican Congress. Who is DJT? Is he really a Republican in a traditional sense? It depends upon how you define "traditional" I thought I would touch on some helpful historical analogies: 1.Today vs 1968-1980 2. DJT ~ Eisenhower and Teddy Roosevelt Now vs 1968: An argument could be made that we have been in one of the most tumultuous periods in American History over the past decade or so. It is evidenced in the stock market behavior of the last 15 years. We have had two of the largest bear

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So, let's not lose focus on the ecomomy...it's not too bad

Let's start by just looking at market action. After nearly a decade of underperformance US financials are showing relative strength. They are indeed cheap on a book basis. But can there be any visibility into earnings growth? Could the end of the Obama years lead to better banking futures? The bank index is now testing multi year highs and happened to be up big in yesterdays massive rally. Here you have the Dow Jones Transportation index.As you can imagine, this is a very cyclical index and is a forward leaning indicator. As goods and people are transported, ecomomic growth moves along with it. Here is a reinforcing datapoint. This shows US Air traffic. Clearly lots of strength here. As both a consumer discretionary item and

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Could there be a Brexit 2.0, and are the markets prepared?

Just as the Brexit outcome in the United Kingdom had very significant affects on global markets, I view real risk of a similar type of event happening in the United States with our Presidential election on Tuesday, November 8. Going into the vote in the UK, the world was sanguine about the chances of the British Citizenry actually voting for a "Leave". The punditry that nary has an independent thought and so often just writes what they are told, assured the world that the vote would be a non event. Even global betting markets had the odds skewed as if it were a sure thing that the British citizens would never be so dumb as to vote to leave. The scare mongering and independence bashing was

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Transfer of assets & business interests: Proposed Treasury Regulations Under IRC Section 2704 Would All But Eliminate Valuation Discounts

by Paul McGloin Client Considering Planning Transfers May Wish to Implement Them Prior to December 1st It is rare that a proposed Treasury Regulation gets much attention from estate planning practitioners, especially ones issued during the vacation month of August. However, on August 4th the IRS issued proposed Treasury Regulations under a little-used section of the Internal Revenue Code that may represent one of the biggest changes in estate planning law in the past thirty years. Planners around the country have spent much of the past month huddled in discussion groups and on conference calls to try to understand what these far-reaching changes mean for their clients. For decades, when making transfers of interests in family-owned businesses, planners have relied on valuation discounts to reduce the

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Of valuations

Not that I want to be the one spinning anything in equities at this point as positive, but, if you look at S&P valuations(courtesy bloomberg) based upon two particular metrics, you find that on a price/book AND a price/cash flow(trailing) you do NOT find overvaluation. In fact, if you consider the price/cashflow metric alone, it appears relatively inexpensive. Next, if you look at both trailing PE and estimated PE, the valuation falls into a mid range. But, this is NOT the case if you look at trailing Price/ebitda. In this case, it shows extreme overvaluation. One last thought, especially as it relates to the P/Book ratio, this metric seems at odds with the continued profit margin strength.

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In spite of ourselves....

It's Your Brain, Man... According to research firm Dalbar, Inc. Behavior is the number one cause of investor underperformance. At Intellectus,along with key partners, we are in the midst of some very extensive work on investor behavior. According to our friend Dr. Thomas Oberlechner, former MIT and Harvard Behavioral economist and Senior psychologist to some of the worlds top hedge funds, more than 25% of an average investor return can be attributed to his or her behaviors. That is more than 2x the cost of "fees" per se. Our work has taken us into the realm of research and technology builds to discover behavioral biases and impact upon investing. This research is being turned into algorithms that can extract amazing insights and hints as to

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