Intellectual property question, page-11

"I doubt Munz would be selling with specific inside information that could get him into trouble. However when you are in a business you can better weigh the probabilities of issues coming up, you can understand business relationships, competitors etc. I would suspect he feels that the risks to the business are growing, and on a risk to potential future reward basis - he is selling. There is a lot of concentration in the US hardware market (nowhere near as much as there is here). There is also always a lot of copycat interest in things like this - not always from low wage Asia, but from reputable competitors as well."


Conversely, when you are in a business you are sometimes too close to things, which prevents you from rationalising an investment assessment objectively. Corporations - even the best ones - are riddled with flaws and imperfections. I don't know how often I'm met people at barbecues or next to sports fields who work for successful companies, but who complain how inefficient their employers are are or how slow it takes to get things done or how much office politics exists.

That's the nature of the beast ... corporations that succeed invariably do so despite themselves.

Besides, the issues you mentioned - competitive dynamics, business relationships, business risk, industry structure, global supply chain - all of those are largely macroeconomic factors which are readily observable to the vast majority of competent followers of RWC and the industry in which it operates, and many of them I'll wager are a lot smarter and more experienced at discerning and preempting evolving industry structure and risk than Mr Munz.

So I'm not sure why one would necessarily defer to his interpretation (if that is indeed what it is that made him sell... and we don't even know that).

Who knows, maybe Munz was "kept awake at night" [*] by the rising copper price and the adverse impact it would have on RWC's near-term profits, as articulated at the AGM.

I could understand shorting the stock based on a view of excessive valuation against the backdrop of potential industry structure risks (the reason why RWC will not be a high conviction, investment - i.e., 10% portfolio position - for me), but to short the stock by trying to second-guess the invisible motives of someone you don't know... that I don't get.


[*] The way you state that is as if you have definitively knowledge that something was indeed worrying him greatly.