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Performance – May 2025

SSI tracking portfolio was up 1.1% in May 2025. A detailed performance breakdown is provided below.

Below you will find a more detailed breakdown of tracking portfolio returns by individual names as well as elaborations on names exited during the month.

 

TRACKING PORTFOLIO: +1.1% IN MAY

Disclaimer: These are not actual trading results. Tracking Portfolio is only an information tool to indicate the aggregate performance of special situation investments published on this website. See full disclaimer here.

The chart below depicts the returns of SSI Tracking Portfolio since the start of 2017.

Screenshot 2025 05 30 at 11.21.54

 

PERFORMANCE SPLIT MAY 2025

The graph below details the individual MoM performance of all SSI Portfolio ideas that were active during the month of May 2025.

SCR 20250602 dup

 

PORTFOLIO IDEAS CLOSED IN MAY

Kronos Bio (KRON) -24% in 5 Months
Kronos Bio was a busted biotech trading at a steep discount to net cash after scrapping its lead clinical trial. The company launched a strategic review, laid off 83% of staff, and the CEO resigned—getting a $900k change-in-control bonus on the way out. Insiders, including the former CEO, owned over 27% of the stock. It seemed like the strategic review was likely to result in a positive outcome for shareholders. Assuming it would take several more months to complete, upside to forward NAV was 48%. Instead, this month KRON was acquired by Concentra Biosciences for $0.57/share in cash, plus a CVR tied to post-closing net cash above $40m and future asset recoveries. Initially, the CVR looked pretty interesting, however, the later released proxy showed underwhelming value assumptions from the management, undercutting the appeal.

Microstrategy (MSTR) – very big mistake
MSTR was trading at a wild 100%+ premium to NAV (almost entirely made of its Bitcoin holdings). Historically, these premiums didn’t last. Past surges to 140%+ had always repeatedly reverted to more “reasonable” 30–50% levels. So, this looked like a compelling bet on premium normalization. As Mark Twain said, history doesn’t repeat itself, but it often rhymes. The setup also allowed for a clean hedge via Bitcoin spot ETFs.

However, the premium didn’t normalize. It held, and the bubble still looks far from popping. In fact, we now have a growing cohort of (smaller) crypto treasury stocks trading at absurd NAV multiples. MSTR continues to issue stock at over 100% premium to NAV—seemingly without friction. I was wrong to think Bitcoin ETFs would curb demand for a stock trading at 2x its NAV. I also underestimated how much MSTR’s NAV would grow because of that very issuance. Both were big mistakes that resulted in large losses. Time to move on.

ARCHIVE OF MONTHLY PERFORMANCE REPORTS