Spec Value Hunter Roadmap

Spec Value Hunter Recommendations employ our rational speculation model, where we target more advanced companies than those recommended as Bottom Fish. Unlike Bottom Fish picks where we have 500% gains as long-term price targets, spec-value picks are generally of a shorter-term nature, and, depending on the situation, may target lower percentage gains but do so in more liquid stocks with greatly reduced gestation periods.

Link	Spec Value Hunter Roadmap
Active Spec Value Hunter Recommendations	This link lists in alphabetical order all open spec value hunter recommendations. This list shows how much a recommendation is up or down. The color shading indicates if the stock is above or below the recommended price, which will be the closing price of the day before the recommendation is issued. Spec Value Hunter recommendations are not issued during North American market hours and are given the next trading date as the publication date. Companies recommended as "bottom-fish" usually have a significant timing risk, meaning that higher prices hinge on certain events sometimes under control of management, sometimes not. Bottom-Fish have to be bought and held, sometimes for long periods. In contrast, Spec Value Hunter recommendations can be issued any time, and are made either on the basis of "absolute value" assessed purely in terms of market price and corporate fundamentals, or on the basis of "relative value" assessed in terms of market prices for comparable companies. Spec Value Hunter recommendations include a target price, a timeline, and the assumptions behind the prediction. The Spec Value Hunter recommendations rely on the Rational Speculation Model developed by John Kaiser.
Trackers	When there is a major corporate development affecting an open Bottom-Fish or Spec Value Hunter recommendation we will publish a Tracker to the web site and send an email notice to all KBFO Members. We will also publish a Tracker when we write a detailed analysis with lots of graphics. This may occur after we have completed a property visit, or because we wish to explain the story in detail.

Spec Value Hunter Key
	Good Absolute Spec Value - Buy		Good Relative Spec Value - Buy
	Confirm Good Absolute Spec Value - Buy		Confirm Good Relative Spec Value - Buy
	Fair Absolute Spec Value - Hold		Fair Relative Spec Value - Hold
	Poor Absolute Spec Value - Sell		Poor Relative Spec Value - Sell
	Confirm Poor Absolute Spec Value - Sell		Confirm Poor Relative Spec Value - Sell
	Closeout Absolute Spec Value Buy Cycle		Closeout Relative Spec Value Buy Cycle
Spec Value Hunter recommendations focus on the absolute or relative value of a company's story. They are based on specific expectations with regard to timeline and outcome. An absolute spec value rating is based on how the current valuation of a company relates to its dream target potential within the context of the rational speculation model. A relative spec value rating indicates how a company's valuation compares to that of similar companies. It is thus possible for a company to represent poor absolute spec value and good relative spec value at the same time. When we issue a good speculative value buy we expect prices to increase fairly quickly to a level where the stock represents fair speculative value. In the case of good absolute spec value we judge the stock to be undervalued on the basis of its fundamentals alone. In the case of good relative spec value we judge the stock to be undervalued relative to comparable companies. A relative spec value rating signals that a company's valuation is vulnerable to market-driven changes unrelated to company fundamentals. In either case where we initiate a spec value buy cycle we expect the market to close the gap so that a fair speculative value rating is appropriate. The risk with relative spec value buys is that the market may end up pricing the comparable group lower, rather than pushing the stock with good relative spec value higher in line with the comparable group. A good or poor spec value rating of either the relative or absolute kind in our view represents an inefficiency in the market. When we assign a fair speculative value rating during the midst of a buy cycle it signals that we view the market pricing as efficient, and that higher prices will depend on the outcome of company specific fundamentals or changes in the macro market outlook. A closeout is issued to close a spec value buy cycle.