frommi

Puts on HCSG and RGEN. In both cases operating cashflow is shrinking since several quarters while net income is growing and both trade at absurd valuations based on net income. Additionally RGEN will lose >30% of its revenue in 2021. (source: https://www.biocentury.com/bc-extra/financial-news/2017-09-26/repligen-precarious-waters-after-ge-launches-house-resin)

Bielefeld, Germany

Based on what i have seen in the past 3 years of international netnet investing is that drawdowns/volatility are smaller than the overall market. Especially if you have a lot of dividend paying japanese stocks with low betas in the portfolio. And hopefully not every netnet is losing money. I also have netnets with P/E`s of 3-10 in the portfolio. Its just that those are not available in the US.

Just to have some fun: the FOMC statement today! ;D

Which one where you able to buy? I bought polish stocks with degiro. :)

I ran the screen frommi described above against the Portfolio123 data today and it is only returning 2 current symbols. GIGM GigaMedia LTD MktCap ~33m and NCAV ~57m MSN Emerson Radio Corp MktCap ~35m and NCAV ~52m Yes, there is no way around international markets if you want to build a diversified netnet portfolio at the moment. The most stocks in my portfolio are currently from Japan, Singapur, Hongkong and Poland.

Exact rules: https://drive.google.com/open?id=0BzQbS-AUNeo9UHpjZm1aaks3a00 exclude china and sharecount 5% allowed difference instead of 20% may be the drivers.

Since it is a portfolio simulation, that is the frequency the engine uses to evaluate if it has to execute a buy or sell-rule. Stocks are only bought or sold if the rules are met. Yearly or monthly rebalancing is worse, because the simulation can`t take advantage of price drops/surges in between that timespan. I checked the transaction log after the simulation and it was the way i expected this to work.

Yes, i am running 50% of my money that way but only since 12 months.

Here are the results of my tests: 10 stocks: https://drive.google.com/open?id=0BzQbS-AUNeo9OUt2NEZHcHpaM1U 20 stocks: https://drive.google.com/open?id=0BzQbS-AUNeo9ZDRPaGJQeXJISWs buy rules: ncav/mktcap > 1.4 price > 0.1 avg. volume10day > 0.1 mktcap < 150 million stable sharecount ncav burnrate < 25% YoY and QoQ no biotech,financials,o&g stocks. ranked by tangible book sell rule: ncav < mktcap

I looked at my account statements and you are right, trading japanese stocks was pretty cheap, but trading otc stocks with very low prices and buying australian stocks was expensive for me. (around 0.5% per trade, so i took that as a reference.) And when you don`t cross the ask its sometimes hard to build meaningful positions, thats the reason i think that 0.5% slippage in a backtest is reasonable. I missed the point of not rebalancing the whole portfolio so you are probably right that it doesn`t lower the returns so much. But a part of whats going on with monthly rebalancing might be that you are capturing the bid-ask spreads when the closing prices bounce between them. @stahlehyp you can start a portfolio123.com trial to get lists of netnets.

Does the bloomberg backtest use realistic transaction costs and slippage? With netnets slippage can be the deciding factor if more or less rebalancing is better. Also the tax consequences of monthly rebalancing can ruin your backtest. 1% per month easily eats the excess return of a monthly rebalance. (And maybe you can do this with a tiny amount of money, but i don`t think you will be able to monthly rebalance a netnet portfolio with more than 500k in it.) The best i was able to get in a backtest with portfolio123 was a CAGR of 51%, but the drawdown was 68%. It was an equal weight simulation of the 10 netnets with the highest discount to tangible book. With 20 stocks it looked more "useable", since it was still a CAGR of 44% with market like drawdowns. I used 0.5% as commission and 0.5% as slippage which is still very optimistic for a netnet-system in my view. That system used a rule to sell at NCAV, so no fixed holding period. (either NCAV deterioated very fast or the stocks go up to NCAV, i don`t think there was a stock longer than 3 years in the portfolio.)

I just read that in the past 5 years only 13 of 500 stocks in the S&P500 outperformed the index. My conclusion is that you either have to go hunting outside the index (microcaps etc.) or you have to increase your turnover to outperform. Going the microcap route is the easiest route to outperform with small AUM and at the same time the hardest thing for people to do because it is viewed as risky by most investors.

source: https://can-turtles-fly.blogspot.de/2009/08/charlie-munger-stock-market-as-pari.html

I am german and looking for a new home since around 2 years now. I can't find anything above a 3-3.5% annual rent/price yield with closing costs of >10%. This is in a medium sized city in NRW. The buying side is pretty crowded right now, so even if i can get low finance rates i just don't see how that is attractive right now.

2% currency +-0% (made money on USD, lost some on JPY) longs +20% shorts -18% really fucked up on the short side, but made some mistakes on the long side, too. On the long side i sold some things too early, like OKE, RGLD, BAC-WT or AHPI. On the short side i really need to stick to my rules, 10% of the loss were because i started shorting in early March instead of the end of April and i was at -150% net short exposure at times. Next time i will just go to cash if i have the need to be out of the market outside my short-window and i will not go over -100% short exposure (which is scary enough when i think about it). I am now at +-0 on the short side after 3 years without a true bear-market, so no reason for me to give up shorting in the summer for now. Maybe i am not that much wealthier than at the beginning of the year, but i learned a lot. (especially about international netnet investing, which i started in september this year)

Are you talking about STR Holdings? It's delisted right? Curious why you think they'll come back from the dead. Yes, its delisted. Its just the cheapest stock in my portfolio (price/intrinsic value) and i think its time that mean reversion kicks in. Maybe the closing of the malaysian factory is finally visible in the income statement or they get a big cheque from the insurance because of the fire in their factory in china or they simply fix the money leakage somehow. At 15% of NCAV there is a lot of negativity priced into the stock already, even if there is just a 30% chance of going back to NCAV its a very good bet. But i wouldn`t bet the farm on it.

STRI and 8148.JP I have that nagging feeling that cash will outperform ~95% of all mid or largecap stocks in 2017.

Sold WFC/MSM and bought MON.

At the current point in time the best investment for a young person is probably knowledge, so tell him to buy some good investing books instead. If that is already part of the plan i would pick a small cap stock with a business model that is easy to explain and follow. I believe that AMNF or CSVI are good picks for that.

Na, this is too simple to be working, it has to be a compounder with ROIC > 50%! And look at all the crap that you have to buy!! ;) Seriously, i think its better to buy a stock where cash, receivables and inventory are evenly split and it trades at a 50% discount to NCAV than to buy a shell company where there is only cash on the asset side of the balance sheet and the discount to NCAV is small. Therefore i would argue that a large discount to NCAV (<50%) and current assets/liabilities>2 is one of the best strategies out there and also delivers roughly 50%. At least there are some studies that have found that to be the case. I still wonder if its a good idea to exclude companies that have issued a lot of stock in the past because i have not found any studies researching that. Most studies probably include all these stocks and still return 30-50%, thats pretty damn hard to beat. Currently most netnet stocks i found are in Japan, Singapur and Hongkong.

Thanks again, very helpful. Looks like leverage has gone up a lot the last 3 years. ev/ebitda for the whole index is 21 right now? Are the forward earnings/ebitda a joke?

Thanks, can you attach a picture of the balance sheet, too?

Jan 2018 IWM Puts Strike @120

BAC.WTA