About Us - Secret Sauce

There is no secret sauce - just hard work and some proprietary indicators we have developed over the years. We built our first database before we built our company. The database is currently in its third generation, and we are beginning to allow clients to access it.

As behavioral economist James Montier recently reminded the investing world, you can control your process but you can't control your outcomes, so you should focus on your process and good outcomes should result. We are very process oriented, and we believe that approach has served us well.

We first focus on shorting activity, measured different ways over various time periods. We combine the most useful measures into one indicator that we call the Short Interest Score TM. It includes short activity expressed as shares short as a percent of shares outstanding, shares short as a percent of float and the new shorting as a percent of shares outstanding. We look at the last few months – giving more weight to the most recent periods. We have created similar indicators to add some perspective to insider activity and free cash flow. Then, we like to see if there might be potential accounting issues highlighted by examining patterns of the recent operating accruals. Once we have identified sufficient causes for concern, we rebuild the financial statements and begin poking around the industry looking for reliable, unbiased people that can help us understand the company and the problems it may be encountering.

We invite you to examine our work itself. We think you will understand how it can help you.