Sign Up Here to Receive These Letters
Islamorada Investment Management - Contact us at:

In This Issue
bullet Cale's Notes: A Special Research Report.
bullet About the Tarpon Folio: More about our Spoke FundŽ.

Letter to Investors

September 2011 [email protected] (305) 522-1333

To change your subscription, see link at end of email.

Cale's Notes

Cale Smith

Dear Investors,

September no doubt felt like a frustrating end to an already tough quarter. Since just the end of June you've probably questioned the wisdom of politicians in D.C., credit rating agencies, European governments, hurricane forecasters, the Dolphins coaching staff and/or your portfolio manager.

There's not much of real significance to add on those first few issues beyond what I've already shared. And when it comes to Tarpon and Gecko, your portfolio manager continues to ride it out. This may seem foolish to some of you, given our recent bruises and the constant drone of dour headlines of late. Suddenly, it seems, everyone has become a global macro trader, and the next move is obvious.

Except, of course, it isn't. Whatever happens in the market over the course of the next few months and years will be more driven by unforeseen developments and random Brownian motion than the trends and conclusions market traders now think they can foresee. To paraphrase the rationalist philosopher Karl Popper, "What we all will next know will change what happens next - and we can't know what we'll know next, since if we could we'd know it now."

Actually, that might have been Yogi Berra.

Either way, it's useless to try to predict the market. Europe and our own economy demand much attention these days, but I have grown weary of the cacophony of calamitous predictions from alarmists. It's much more enjoyable to actually focus on investing. So in this letter, I thought I'd get back to that.

And rather than try to directly address whatever macro angst you might be feeling, this time I thought instead I'd try to show you what I'm seeing.

So I'd like to present to you my formal analysis of Tarpon Folio holding Clearwire. It's a lengthy report that was published earlier this week on a popular website for investing geeks called Seeking Alpha.

Please check it out at the link below. At times it can get a little wonky, but I'd like to think it's a thorough overview of the company. It also includes more valuation work than I typically include in these letters. Most important, though, is that it gives a good glimpse into my own mindset these days.

As I think you'll see, there are some great opportunities out there. You've just got to be willing to dig - and then to be patient during months like the one we just had.

So please check out my article on Seeking Alpha by clicking the link below:

"A Value Investor's Case For Clearwire."

And here is a follow-up article I wrote, too:

"Clearwire Postscript: The Legend of John Stanton."

I hope you find them useful. Please let me know if you have any questions.

- Cale

About The Tarpon Folio

The Tarpon Folio is an innovative, investor-friendly alternative to the traditional actively managed mutual fund. It's built on a model we call a Spoke FundŽ.

It is more transparent, takes more concentrated positions and is significantly less expensive than the vast majority of mutual funds. The portfolio is managed for long-term growth using value investing principles.

Fees are 1.25% of assets annually, assessed on a quarterly basis. Turnover, taxes and trading are minimized in the fund, and investors can customize their accounts in several key ways, including tax preference. Each Tarpon Folio account is also protected by three types of insurance for a maximum of up to $9.0 million

For more information, visit our website.

Here is our privacy policy, our Form ADV and our Fiduciary Oath.


See our performance disclaimer for more. Any historical performance data contained above represent performance results as reported by the portfolio listed. The performance results are for illustration purposes only. Historical results are not indicative of future performance. Positive returns are not guaranteed.

Individual results will vary depending on market conditions and investing may cause capital loss. The S&P 500, used for comparison purposes, is significantly less volatile than the holdings of the funds listed. The performance data is net of all fees reflecting the deduction of advisory fees, brokerage commissions and any other client paid expenses. The performance data includes the reinvestment of capital gains.

The publication of this performance data is in no way a solicitation or offer to sell securities or investment advisory services.

© Islamorada Investment Management. All rights reserved.

Sign Up Here to Receive These Letters