Posts

US-EU Trade Slowdown?

In December 2015, oil tankers made u-turns while crossing the Atlantic [ZHOIL]. In March 2016 the mayor German rail carrier announced a 8-10% percent drop in fright shipments for 2015 [RG]. In April 2016 its cheaper to rent a dry bulk tanker than a Ferrari F40 [ZHTANKER].

European capital markets started weak this year, recovered to their highs again while the US dollar weakened during Q1 2016. Are US and Europe's economies are healthy?

(Side note: As TTIP is coming back onto the agendas of the media, political parties, NGOs, investors and companies. Why should a rigid trade deal be made, when the benefits are small but the risks of loosing national sovereignty is high while the future economic situation is very uncertain? Maybe some oligarchs try to secure their power before historic changes are happening?)
US-EU Trade
The first industry which feels a slow down in the (world) economy is the logistic  sector. This early indicator worked like charm the last 2 crisis. Now its crash…

Value of written goals

Bild
Here and there I heard about a Harvard study about having goals drives success. I thought "Sounds reasonable, no need to think about it deeply." Today I heard a talk of Gerald Hörhan and he mentioned the example, again. So my many-smart-people-talked-about-it threshold was crossed and I did a short research to find that study. I hoped to get an interesting topic I can use as material for talks.

And I found an urban myth [DOMINICAN]. But is there any truth to it? The Dominican University (?researcher Gail Matthews and Sarah Gardner?) did a study, because they saw a research opportunity. I found just a summary (see [SUMMARY]) and no original source to the study. But, well, once you kill a cow, you gotta make a burger.

Goal Study
The study split the participants into 5 groups and compared what goals they achieved 4 weeks later [SUMMARY, FORBES]:
Group 1 - deeply analyzed their goals and the resources they had to accomplish them.  Group 2 – wrote down their goals after the deep an…

2015 Portfolio review

Bild
2015 was dismissal! I increased my portfolio just by 3.53%.



2015Buy PriceBuy DatePriceDatePerf.absBEGINENDHold






Nestle67.89 €2015-02-0969.66 €2015-12-302.61%10.00%10.26%Barrick Gold10.99 €2015-02-096.98 €2015-12-30-36.49%20.00%12.70%Oracle37.79 €2015-02-0933.96 €2015-12-30-10.13%10.00%8.99%Reply67.69 €2015-02-09127.90 €2015-12-3088.95%10.00%18.89%SMT Scharf14.67 €2015-02-0910.00 €2015-12-30-31.83%15.00%10.22%







Sold






Mircosoft22.30 €2013-04-1838.94 €2015-09-1974.62%10.00%17.46%







Cash




25.00%25.00%







Performance




100.00%103.53%

This year I failed to achieve my target RoIC of 26% p. a. by a whopping 22.5%. The suckers were Barrick Gold and SMT Scharf which I overweighted.

SMT Scharf
The coal decline was somewhat foreseeable - surely not to its extend.* The years before 2015 coal mines produced more than the world demanded, thereby anticipating growth mainly in China. Right now China seems to grow slowly. Looking at electricity consumption growth of 1.3% from January to June 2015

Silverlake Axis Ltd

Bild
Silverlake Axis is a banking software company. It operates in south East Asia and is one of a few player in the banking software oligopoly. Prior to August 2015 Sliverlake Axis was a star. Than the bombshell dropped, as razor99 accused Mr. Goh (60% shareholder and CEO of Silverlake) that he and Silverlake did dubious deals in related party transactions at the expense of minority shareholder [RAZOR99]. The stock got slaughtered - from 1.20 to 0.55 SGD. In January 2016 Deloitte cleared Silverlake of these accusation [DELOITTE]. Is Silverlake a value buy now?


Can I trust the numbers?
Deloitte Singapore was ordered by Silverlake to investigate razor99 accusations [RAZOR99, DELOITTE]. Deloitte found that for the 3 acquisition in question, the prices 2 had fair prices where 1 was in the higher range of fair. ROI is for the 2 fair acquisitions 10 to 12% whereas the other is about 3%. Today the 3 acquired businesses make up to 85% of revenue. Silverlake today is Silverlake because of the 3 acqu…

Understanding Energy Sector: The history of oil and fracking

Bild
2015 is over and my challenge of 2015 was to acquire knowledge outside the software industry. In my opinion the energy sector is the most important sector of all, so I want to understand more of it. Without oil, no warm houses, no fertilizer (= less food), no transport, no travel (beyond a couple of miles). I felt like Alice in Wonderland going deep the rabbit hole and I want to share some of my insights.

First I studied oil history, than fracking oil industry, than the coal industry. Fracking is a very interesting topic by itself. 10 years ago nobody though the US will ever produce > 10M barrels a day - now it does. This is a huge game changer economically and geopolitically. The political debate in Europe to allow fracking made me very interested. Is there an hidden opportunity? Therefore I wanted to understand this (1) fracking revolution as well as (2) its impact on doing business. After the crash of the oil price in August I did research into the market structure of oil.

Af…

Startup Investing: Throw a snowball

Bild
This article is how I came up with a medtech startup idea, which is based on my previous article about filtering ideas Startup Investing: How to build a snowball.

How I got an idea Half a year ago I read the high interesting book "Risk Savvy" by Gigerenzer. The book is about decision making under uncertainty and risk. A couple of chapters are about medical decision making for doctors and patients. Basically Gigerenzer promotes the idea of using natural frequencies and fact boxes to communicate risks of a therapy, drugs and illnesses.

Natural Frequencies describe probabilities as absolute numbers. Saying "5 out of 100 people get ill" is better than saying "5% of people get ill". The main advantage of saying "5 out of 100" is, that its easier to visualize. A second advantage is that it explicitly says on what the probability refers to and prohibits evil relative probability.

Relative probability is mathematically correct, but really evil, if not co…

Startup Investing: How to build a snowball

Bild
Alice Schroeder named her Buffett biography "Snowball". What a wonderful analogy for compounding! In this article I describe how I build my snowballs aka. startups. The maths of rolling a snowball Imagine a snowball on top of a hill. The ball is sunk into the snow coverage. Without a force pushing the ball to one side, it will not move. As we push the ball to one side, the ball moves and collects snow. As more and more snow is collected the ball grows bigger. This growing process absorbs some if not all of the pushing force.

So, if the ball is too small, too slow or the hill not steep, the ball has not enough energy to support the growing process. Than the ball will just stop rolling. If the ball has more energy than the growth process requires, the ball will further accelerate thereby increasing its kinetic energy. As the ball has more kinetic energy it can accelerate the growth process.    

The growth process creates friction consuming energy. Similar to growing company…