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Notes on SPACs
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spac.md

SPAC notes

Links

What

  • A SPAC is a special acquisition company sometimes also referred to as a ‘Blank Check’ company. A simple enough explanation for this context is that it’s a group of wealthy people that decide they want to make a ton of money using other people’s money.

Profits in SPACs

Ticker Week 38 Week 39 Week 40 Week 41
SPAQ $11.48
DMPH

Catalysts

  • First few minutes the Warrant and Equity tickers go live
  • During the ‘rumor period’ where unsubstantiated rumors are swirling about who the merging company is going to be.
  • Right when a letter of intent / binding agreement is announced
  • News comes out around the company the SPAC is going to merge with.
  • Sympathy Plays
  • Merger vote day anticipation / merger vote day
  • Merer day

SPAC Strategy

  • 10% account: 1 Year swing, Buy 80% units, 20% warrants on go-live date of a SPAC team I have faith in. Presently I have FEAC.U and FEAC.WS. hold through merger and at least 1+ years.
  • 30% account: 2-6 month hold: Buy 100% warrants except 1 equity share to track price post merger announcement and once I've fully dissected the merging company, and have faith I can get a big return / the initial excitement runup has simmered down. Right now I have LCA with <$3 warrant avg. (Next I'll be moving into FMCI or SPAQ depending on timing, then likely DMYT. I sell 50% of my holdings leading into merger and move them into my next play and hold 50% a week after merger / sell them when I like the price or it's heading the wrong way.
  • 10% account: 1 to 5 day hold: buy 100% warrants and 1 equity ticker on different phases of all SPACs that give good returns - Those phases are day 1 warrant go live, rumor of merger, letter of intent, and binding merger announcement. I will also use this part of my account to load when SPACs are seeing strong volume in a day or warrants are overly discounted to their equity share price. I only play momentum and watch the charts for this one.

@spacSpace on Atlas-Trading

  • $DMYT (planned merger with Rush Street casinos)
  • $FEAC (planned merger with Skillz - what I'm calling the DraftKings of card games and apps)
  • $HCAC (planned merger with Canoo EVs)
  • $SPAQ (Fisker, everyone's in this one)
  • $IPOB
  • $IPOC
  • $PSTH/U (unannounced merger targets but good management teams)
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