As we move forward and see what actions and thoughts come in on QUIK as an investment, or alternative investments in this, or other sectors I will put this up for reading.


C. Munger on the choices we have to make.

http://can-turtles-fly.blogspot.com/2009/08/charlie-munger-stock-market-as-pari.html

The model I like to sort of simplify the notion of what goes o­n in a market for common stocks is the pari-mutuel system at the racetrack. If you stop to think about it, a pari-mutuel system is a market. Everybody goes there and bets and the odds change based o­n what's bet. That's what happens in the stock market.


Pari-Mutuel Betting System

I'm going to be quoting extensively since it is important to get the thoughts from the source. I hope this doesn't violate some fair-use law or something. (As is usually the case on this blog, all bolded or highlighted text within quotes are by me. I made some slight edits with spacing.)

What is a pari-mutuel betting system? It is a betting system that is used in horse racing, among other activities, which involves pay-offs based on the total pool. An important element of it—this is what I found important for the stock market—is that the odds change based on the bets. Here is Charlie Munger introducing the concept:

Everybody goes there [horse track using pari-mutuel betting system] and bets and the odds change based o­n what's bet. That's what happens in the stock market.

Any damn fool can see that a horse carrying a light weight with a wonderful win rate and a good post position etc., etc. is way more likely to win than a horse with a terrible record and extra weight and so o­n and so on. But if you look at the odds, the bad horse pays 100 to 1, whereas the good horse pays 3 to 2. Then it's not clear which is statistically the best bet using the mathematics of Fermat and Pascal. The prices have changed in such a way that it's very hard to beat the system.
And then the track is taking 17% off the top. So not only do you have to outwit all the other betters, but you've got to outwit them by such a big margin that on average, you can afford to take 17% of your gross bets off the top and give it to the house before the rest of your money can be put to work.

Many will prefer the less risk of the gud horse )(NOD.ol)and the 3/2 payout.
Some will think they have a mispriced bet and go with the 100 to 1 horse. (* QUIK)


After reading and studying here is the dilemma we( our SAT Bfast club) faced.

Nordic Semi-  A very important bit and piece in the coral reef.  Many with this expertise have gone, CSR-

Qualcomm Acquires CSR To Accelerate Its Growth In IoT

 Quintic-

NXP To Acquire Quintic's Wearable And Bluetooth Low

CEVA Acquires RivieraWaves

etc.

I want to own this business.  But it has  about a 1 billion market cap.  Over 10 x valuation of current Bluetooth Smart sales.  But the wave is also very large.

Vs QUIK.

clearly Nordic is priced as the good horse and will pay

the good horse pays 3 to 2

QUIK

 the bad horse pays 100 to 1,

a very good mental process here

Then it's not clear which is statistically the best bet using the mathematics of Fermat and Pascal. 

Think it over for yourselves and put the $$ down.