The most important portfolio goal for most investors is wealth building, due to the risks of unexpected financial emergencies, large planned expenses, and retirement preparations put off too voluntarily. The expansion of longevity through advances in bioscience technology compounds these past financial shortfalls for many individual investors.
Biotechnology under continued covid persistence is drawn to global immunology concerns, which may create temporary costs for established developers working on opportunities outside of the immediate mainstream. The trade-off between risk and reward constantly seeks balances, with a disadvantage for those less knowledgeable or less willing to act smarter (for whatever reason).
Today’s Survey of Over 4,000 Stocks Reveals Hundreds of Stocks Exercise the Market-Maker [MM] capital liquidity capabilities, some of which, such as Ascendis Pharma A/S (ASND), reveal strong and previously reliable indications of near-term capital gains ahead.
“Ascendis Pharma A/S, a biopharmaceutical company, is focused on developing therapies for unmet medical needs. The company offers SKYTROFA for the treatment of patients with growth hormone deficiency (GHD). It is also developing TransCon (HGH) growth hormone for pediatric GHD in Japan; TransCon hGH for adults with GHD; Parathyroid hormone TransCon for hypoparathyroidism in adults; and TransCon CNP for pediatric achondroplasia. Additionally, the Company is developing TransCon toll as a 7/8 receptor agonist for intratumoral administration; and TransCon IL-2 β/g for systemic administration. The company was incorporated in 2006 and is headquartered in Hellerup, Denmark.
Source: Yahoo Finance
Big Picture: Risks vs. Rewards
We have grouped ASND with other similar clinical-stage biotech companies that are frequently compared by individual investors. The predictions implied by the MM hedging actions facilitating bulk volume trades ordered by the big dollar funds provide a likely future price outlook for comparison. Actual market outcomes for these stocks following previous guidance with today’s higher forecast proportions add perspective to valuations.
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The trade-offs here are between short-term upside price gains (green horizontal scale) considered worth protecting by market makers with short positions in each of the stocks, and past actual price declines experienced during of the holding of these shares (red vertical scale). Both scales are percent change from zero to 25%.
The intersections of these coordinates with the numbered positions are identified by the stock symbols in the blue field to the right. The S&P500 Index ETF (SPY) Market Index Arbitrage Standard is at location 1]. Our primary interest is in ASND to .
The dotted diagonal line marks the points of equal upward price change predictions derived from Market-Maker [MM] hedging actions, and actual worst-case price declines from positions that could have been taken as a result of earlier MA predictions like today’s.
This map is a good starting point, but it can only cover some of the investment characteristics that must often influence an investor’s choice of where to invest their capital. The table in Figure 3 covers the above considerations and several others.
The main questions for all alternatives are “how likely are these outcomes to occur” and “can their impact be improved?” »
Figure 3 presents the MM price range predictions [B] at [C] for the candidate alternative investments in Figure 1, along with the results [ I ] of their last 5 years of daily forecasts with the same proportions [G] today’s outlook for the index Range up and down.
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Contributing to this comparison are the demonstrated chances of a successful profit forecast in the column [H]its complement of 100 – H, or frequency of loss, size of net gain achieved [I] and the size of the worst loss [F] experienced during previous holding periods such that, when weighted appropriately [O] and [P]they produce the Net of [Q]. Respecting the power of composition, [Q] converted to basis points per day [J] of capital commitment to [R] has a very comparable figure of merit (of) for investment preferences whose primary objective is to build readily liquidable capital to meet emergency, retirement or other planned needs.
By its use as a ranking, the merit factor (fom) [R] for each line provides an additional measure of attraction, highlighting the capital gain potential for ASND. Since [H] odds on wins versus losses and [J] impact of holding periods [R]the sample sizes from which past results are drawn require careful consideration, but are comparable across all types of equity investments.
Please also note the comparison of these stocks with the S&P500 index ETF (SPY) and with the average of 3155 stocks for which we are compiling the population forecasts here. From this population, we use the dimensions shown in Figure 3 to rank the most promising and historically attested few stocks right now, each based on past MM forecasts with both up and down balances like today.
Recent ASND Forecast Trends by Market Makers
The recent strength in ASND’s stock price has apparently caught the attention of some institutional investment bodies. Over the past couple of days, their buy orders have supported heightened expectations for prices ahead.
The current upside target of $331 offers a forward-looking gain of +20%, but its current price of $279 is at the low of market pro expectations of $276-$331.
(used with permission)
The small “thumbnail” image at the bottom of Figure 3 shows the frequency of the last 5 years of ASND daily range indices [RI]. At its current level of 1, the bottom of the forecast range, all subsequent IRs and their prices have clearly been higher. In the past, there have been 41 of the 1088 daily forecasts with IRs of 1.
Of the 41, 71% either hit their upper expectations or were close enough that the gain achieved, including losses, reduced prior gains to 24.7%, slightly below current expectations for a 25% upside. 6%. In 37 market days (7+ weeks) of capital commitment to the business, it achieved a reward rate CAGR of 345% per annum. No guarantees, just a good chance for a big rate of return by being an active investor.
Comparing Ascendis Pharma A/S with its industry competitors makes it a good choice for the industry’s most desirable short-term capital gain vehicle at this stage.
Investing, like the rest of life, is fraught with trade-offs. Each investor has their own preferences and standards of acceptability. Each candidate investment security for the portfolio has its list of pros and cons to present to the investment committee. With a one-person committee, decisions can come more easily than when there are other minds to convince.
But it is important to have the go-nogo decision criteria clearly in mind to apply equally to each of the available investment candidates. And their attributes must be stated in terms directly comparable to those of other job-ready candidates.
We hope to offer selection criteria that help the investor frame his investment selection decision parameters in a fair and consistent manner. We believe that the simple discipline of active TERMD investment portfolio management works well in the holding period implication that our information capture process provides.