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Private Placement Drift

Updated dailyData needs: mediumshort only
paper
1989
Source
Wruck, K. H. (1989). "Equity Ownership Concentration and Firm Value." Journal of Financial Economics, 23(1), 3-28. Also Hertzel-Lemmon-Linck-Rees 2002 JF.
Read the paper →

In plain terms

PIPE financings → distress signal → -23% over 3 years.

How it works

PIPEs go to firms that can't tap public markets → 3y -23% mean abnormal return.

Live results

0 times picked on its own · 1 times inside a blend (1 beat the stock) · updated 2026-06-06
This strategy is a frequent ingredient in blends that combine a few strategies on one stock. It has contributed to 1 such blended picks (1 of which beat simply holding the stock). Picking it on its own is only one of the ways it shows up.
How its picks scored vs. buy & hold
Each pick is graded on a recent year it was never tuned on, against simply owning the same stock
Where its edge concentrates
Share of picks in each company-size group that beat buy & hold
How often it trades
Active vs. patient. Bars on the left mean it waits for rare setups; bars on the right mean it trades often
Return vs. buy & hold
How much each pick beat or trailed simply owning the stock over the test year (extreme microcap moves trimmed)
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Data dependencies

  • SEC form d filings

    A data feed this strategy reads, refreshed on its normal schedule.

  • SEC 8k events

    Item-coded 8-K events (1.01 material agreements, 4.02 non-reliance, etc.).

  • Daily prices

    Adjusted-close OHLCV for every US-listed ticker; primary price feed.

Expected edge

Reported return
-23% CAR over 3y
Tested over
T+90d to T+720d

Hertzel et al 2002: -23% 3y.

Example tickers where this is likely to fire

Illustrative only, the signal fires based on the live data, not a fixed list.

Related families

Explore Private Placement Drift on alphactor.ai

See which tickers this family is currently firing on, with live signals and rankings.

For informational and educational purposes only. Not financial advice. Learn more