frommi
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Posts posted by frommi
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Was there the same amount of bubble talk in 1999 and 2007 in here?
After reading the book "The great crash - 1929" i really doubt that we are in a similar situation, even if the bear inside of me tells me other stories.
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Yesterday the Shiller PE of the S&P500 reached 27… On our way to 29-30?… Like 1929?... That's when I will call a bubble in stocks! We will see… ;)
Gio
That level around S&P500 2215 fits very well with the Fibonacci extension of 161% of the first move from 2009->2011 so this could be a decent target to put on some hedges again.
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Intralot and NWH.AX.
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Finished buying my japanese basket today. Bought 9628, 1782, 4624, 9776, 7292, 5965, 7399 and 7297 over the last 2 months and have now around 25% of my networth in this basket.
Again thanks west for your incredible research!
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Old behavior?
Too much wave counting, technical analysis and being a perma bear. Especially the last is a handicap that i can`t get rid of so easily.
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Sold all puts today. I noticed that i got back to my old behaviour instead of following the plan to just be protected from june->october. It was really hard to do this and i struggled with this decision for one or two weeks now. Whats a bit silly is that i could have liquidated the positions on the start of november with a gain but because i waited so long it came out with a loss. My strategy was to sell half of the put positions when they doubled and that worked very well.
The last 6 weeks were like a complete rollercoaster for me from feeling like genius in the middle of october (outperformance against the S&P was 15% at that point) to feeling like a fool now (-7% against the S&P ). I think i was just fucking greedy in october and that has cost me money and sleep.
Writing this helped me feel a little better so thanks for reading. :)
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Thanks for your studies.
From what i remember the return of a simple 60/40 stock/bond portfolio would have the same performance of a 100% stock portfolio but with a lot lower volatility, this doesn`t really fit to your results.
In the graphs it looks like the portfolio in cash would have earned nothing, it that the reason?
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I miss all the posts about gold. Today, GLD is lower than it was 5 years ago! I suppose that explains why it's out of favor.
Which is really ironic for a value investing board. Some miners trading for less than cash, mines closing, extreme negative sentiment.
Do you have some names that trade for less than cash?
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That is not good. The rebalancing means there is a huge turn over ratio. Based on how this back test was constructed, the actual performance of all of those stock screening strategies is probably about 0.75 actual returns--I'm going off a some simple math, but I just found a research article that also said taxes in an active mutual fund will take off as much as 25% off CAGR. But, you're right. Using IBKR, transaction costs are negligible.
So, the best CAGR is now down to 12.75% CAGR. Better than indexing, but not by much. It makes one wonder if it's worth the effort.
But you only get your tax advantaged index fund returns when you never sell and don`t get dividends. I am under the impression that these studies are made for people who want to sell index funds. From the back of my head compounding of tax advantages really kick in after 5 year holding periods or so, so any value investing that sells near fair value has these problems.
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Looks like he is raising cash, or are there some new bigger foreign holdings?
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I really do think there's a good chance. I wasn't around pre 1970's but isn't there a rich history of booms and busts in the oil patch in america? I think alot of these leveraged guys COULD keep drilling even when it is uneconomic, just to keep the cash flow coming in and the lights on, hoping to make it through to a rebound in price.
And not only the leveraged players, whole countries like russia, nigeria etc. have no choice but to drill more to compensate the lower price. And the cheap money helps to keep the leveraged players alive. I see this as a side effect of all this money printing.
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Thanks for your answer. I used my free time on screener.co already and was pleased with the data, but i am just to cheap to pay for data. Perhaps i should just do it.
I read on alpha architect that a shiller PE screen had very pleasing results, too. Do you think when you take the average EBITDA of the past 5-8 years you get better results? Or did you do that already?
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Are the 10/30/50 stocks always the cheapest 10/30/50 or is it a random pick out of decile #1?
Are netnets in it or are they left out because of a negative EBITDA/EV rating?
Is there a free/cheap screener that can do exactly that type of screening?
If not, west why don`t you set up a website and charge a fee for it? :)
( Can`t wait to see data from 2008/2011. )
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And rebought some S&P puts.
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Bought a small position in AUY.
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I think this solution is very tax efficient. Surely much more efficient than if I were to take out earnings as an individual via income.
Sounds good, i thought about a similar structure for my business some years ago. But i have thrown that idea away because of the additional work/costs involved with a second company and i thought that the advantage in germany is rather small because i pay around 25% on all capital gains/42% income tax as an individual and the company would have to pay around 26% on all the earnings. And my thought was that when i want to pull the money out of the company i get taxed a second time. But perhaps there was a flaw in my thinking or are the numbers in italy so much different?
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Congrats, very well done!
Is your family actively working in these businesses and why did you choose to accumulate capital in the business instead of getting it out via income? Is this more tax efficient in italy?
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I really love this business, but the VIC writeup is in my eyes a bit optimistic. For me the market maker belongs to the brokerage because it makes this company antifragil against erratic market behaviour. The growth in customer accounts is very impressive and the growth in customer equity, too. But a lot of this is because of the runup in the market and the heavy growth of margin debt. I doubt that that continues when the market tanks someday. But of course at that point the market maker spits out profits, so its probably better to take the FCF of the last 5-6 years and put a multiple on that.
And than there is a second point. From the IPO until 2012 the expenses for employees has skyrocketed and eat the complete growth of the company. This changed in 2013 and was probably the reason the stock has gone up a lot in that year.
The author mentioned that Peterffy was shareholder friendly, in what actions is this visible?
http://www.valueinvestorsclub.com/idea/INTERACTIVE_BROKERS_GROUP/128170
Btw. an interesting side effect of reading the annual reports was that i feel now a lot more secure with having my funds at IB. :)
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I don`t think its possible and there where at least two bank robberies in germany this year where a lot of deposit boxes where stolen, so i don`t trust that method.
Or is my name on the stock certificate? While we are at that topic, are my stocks safe when they are in an electronic brokerage and an EMP hits the whole world and kills all electronic devices? :)
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I bought some more FFH today too: 1.12xBook isn't a bad entry point, at all.
I am now a long term FFH holder, too :). I am still thinking how to trick myself into not selling in the next 10-20 years.
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MS makes an interesting point why profit margins won't mean revert:
http://www.businessinsider.com/ms-why-profit-margins-wont-mean-revert-2014-10
Given that he is right than this is probably the catalyst for the mean reversion.
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I think the relevant question is not if they mean revert, but when. I am 100% sure that they will mean revert over the course of the next 30-100 years. But i am not sure about the next 5 or 10 years.
As petec wrote a catalyst for that may be higher interest rates, higher wages, higher commodity costs or even deflation (and people have only money to buy low margin stuff and cost of capital does not mitigate that anymore).
So as long as we are in a stable environment (inflation 1-2%) margins will probably stay that way.
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What if the business mix has changed over time to include more high margins stuff (services, software) and less low margin stuff?
That sounds like "this time is different", heard that a lot around 1999/2000. :)
Higher margins always attract competition and when the worker class has less and less real money they buy the cheaper stuff regardless of moats or brands. So in which world should this be sustainable in the long run?
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For those of you who are buying japanese stocks, how are you hedging if you are doing so?
I buy with a margin account at IB, so i am short the same amount of Yen that the stocks are worth at the time of the purchase. I am still thinking about the idea of readjusting that amount from time to time.
Fusion
in General Discussion
Posted
Thanks for the link, this really sounds like more and more cheap energy for the next decades. Perhaps profit margins expand more. :D