Within the first 9 months of 2022, the Worth & Alternative portfolio misplaced -15,8% (together with dividends, no taxes) in opposition to a lack of -27,0% for the Benchmark (Eurostoxx50 (25%), EuroStoxx small 200 (25%), DAX (30%), MDAX (20%), all TR indices).
Hyperlinks to earlier Efficiency opinions might be discovered on the Efficiency Web page of the weblog. Another funds that I observe have carried out as follows within the first 9M 2022:
Companions Fund TGV: -42,6%
Profitlich/Schmidlin: -20,6%
Squad European Convictions -20,4%
Ennismore European Smaller Cos ––6,6% (in EUR)
Frankfurter Aktienfonds für Stiftungen -12,2%
Greiff Particular Scenario -5,0%
Squad Aguja Particular Scenario -21,2%
Paladin One -21,4%
Efficiency overview:
Total, the portfolio was once more kind of in the course of my peer group. Wanting on the month-to-month returns, it clearly reveals that the rebound in July till Mid August was quick lived and that August and September turned out to be large down months once more, after the disastrous June:
| Perf BM | Perf. Portf. | Portf-BM | |
| Jan-22 | -3.7% | -4.2% | -0.6% |
| Feb-22 | -5.0% | -5.3% | -0.4% |
| Mar-22 | -0.2% | 3.4% | 3.6% |
| Apr-22 | -2.1% | -0.3% | 1.8% |
| Might-22 | 0.5% | -0.4% | -0.9% |
| Jun-22 | -11.4% | -8.1% | 3.3% |
| Jul-22 | 6.5% | 5.7% | -0.8% |
| Aug-22 | -6.0% | 0.4% | 6.4% |
| Sep-22 | -8.6% | -7.2% | 1.4% |
In relative phrases, I take into account the primary 9 months as fairly OK. My aim is to not obtain absolute returns which I believe will not be attainable, however I attempt to outperform the benchmark on common by a couple of proportion factors per yr.
In absolute phrases, 2022 appears to form as much as be the worst yr within the 12 yr historical past of the weblog. The worst up to now has been 2018 with -15% for the benchmark and -11% for the portfolio. Personally, I’ve skilled a lot worse draw downs, particularly in 2001-2003 when the DAX as an example misplaced nearly 75% from Excessive to backside. It appears that evidently many buyers in the present day have both forgotten about these instances or by no means skilled them. Laborious draw downs are a part of the sport. That’s why it’s known as a “danger premium”.
One other studying expertise for a lot of buyers is the truth that low cost shares can get quite a bit cheaper and keep low cost for a very long time. A very good instance is Photo voltaic A/S from Denmark, a inventory I purchased on 9x trailing P/E in Might. The corporate elevated its steerage for 2022 however nonetheless the inventory misplaced -26% (together with a dividend) and now trades at round 6x 2022 P/E. Possibly this resolves itself shortly ? Who is aware of, however one ought to higher put together for these decrease valuations to persist particularly within the small cap space.
Transactions Q3:
The present portfolio might be seen as at all times on the Portfolio web page.
The third quarter was fairly lively. I exited the Renewables basket aside from ABO Wind, by promoting 7C, PNE and Energiekontor. I discovered them pretty valued and was just a little bit cautious with regard to the looming “extra revenue” tax. I additionally diminished Nabaltec barely. I additionally closed the chapter on Bare Wines and offered 1/10 of the Meier Tobler place with a view to handle place measurement.
With Exmar and 3U, two particular conditions had been initiated. As well as I bought an preliminary “Insulation” basket consisting of seven power effectivity shares. Nevertheless this was clearly not optimum timing. 5 of those 7 shares acquired hid badly by the sudden housing decelerate and noticed losses of -13% to -35% over a couple of weeks.
Money is at round 10% of the portfolio, common holding interval round 3,5 years and the ten largest investments make up round 55% of the portfolio.
Remark:
David Einhorn
Simply after I wrote this put up, I listened to a latest interview of David Einhorn right here. Long run readers know that I’ve a sure “historical past” with Einhorn. I checked out a few his investments previously however didn’t perceive most of them. In a single occasion, Einhorn even commented on the weblog at one occasion.
I nonetheless have a excessive opinion of his talents however I’m actually disenchanted how he claims that passive investing is liable for what he perceives because the “demise of worth investing”. I used to be particularly struck by this quote:
It was we might purchase one thing at a fairly low a number of, no matter we thought that was. Suppose that the corporate would do considerably higher, profit from it being considerably higher and notice that different buyers would see what we noticed six months later, a yr later, and would rerate the shares.
So you may purchase one thing 11 instances earnings and perhaps they’d earn 10% extra however you get one other three factors on the a number of and also you make 50 p.c over two or three years.
In fact there may be nothing mistaken with such a “system”, however basically he’s/was enjoying a somewhat quick time period system that relied on different buyers being much less sensible than him and catching up inside a comparatively quick time frame.
Claiming that worth investing is useless as a result of his particular technique doesn’t work anymore is for my part a transparent signal of making an attempt in charge others for one’s personal errors. To provide Einhorn some credit score, his 2022 efficiency appears to be OK, though the listed inventory Greenlight Re has gone nowhere.
Bumsbuden & Quick promoting
Virtually precisely one yr in the past, writing the 9M Efficiency overview 2021, I had the sensation that the times of simple tech cash was over. That is what I wrote again then:
The massive query is : How lengthy will this “flywheel” hold going ? I don’t know however my feeling is that we see already at the very least some sanity with the clearly silly or overvalued “non-tech” tech firms feeling some gravity of their share value. Auto1, the German Used Automobile seller masquerading as a Tech firm as an example misplaced considerably in opposition to its IPO value and nearly -50% from the highest regardless of their steady effort of promoting themselves because the “Carvana of Europe”. Or Lilium, the Frank Thelen backed “Electrical Airplane Taxi” start-up that principally has some fancy prototypes has misplaced -20% in opposition to the preliminary SPAC value.
My feeling is that the simple days of naive tech investing are over. I do consider that there are nonetheless many areas the place a number of break by way of innovation is going on and corporations can develop quick and develop into very worthwhile, however from the present “tech darlings” many won’t reside as much as their guarantees.
Within the quick time period evidently the Covid tailwinds for a lot of mediocre digital enterprise appear to be gone, such because the very latest information of German Software program firm Teamviewer or UK primarily based E-Commerce darling ASOS. Many firms declare that provide chain disruptions are the primary culprits however I do suppose that the issues go deeper.
Those that observe my Twitter feed would possibly know that quickly after that put up, I created a public watchlist (Wikifolio) with a view to present, how shortly one might burn cash by selecting the worst “naive tech” shares solely in Germany.
The outcome up to now is spectacular: This portfolio was solely constructive on the very first day and since then misplaced greater than -70% on the time of writing. The entire train was like “taking pictures fish in a barrel”:
Now in fact the query is: Why didn’t I quick these shares in actuality ? I’d have made some huge cash. As my long run readers know, I finished shorting in 2013 after a blended file.
The issue is that if I had continued to quick over all these years, I’d almost definitely have misplaced some huge cash in between as shares went from extraordinarily overvalued to completely ridiculously overvalued during the last 4-5 years till fall final yr.
As Gamestop and different meme shares have proven, for particular person shares there may be principally no restrict on how overvalued they might develop into. I’ve lately watched the Gamestop documentary on Netflix and it’s wonderful how non secular these meme inventory buyers have develop into.
Total, I additionally discover it troublesome to pursue each methods on the identical tame, i.e. in search of good quick candidates in addition to making an attempt to determine long run winners. The Wikifolio was one thing I did with minimal effort by simply making use of my normal “crimson flag” method and just about shopping for these shares with very apparent crimson flags, principally primarily based on the “operators” behind the shares.
For me, the verification of “crimson flags” with a view to filter out problematic investments early can be the primary advantage of investing time into these sort of firms. For my profitable “Bumsbuden” Wikifolio the next crimson flags labored finest:
- recognized shady buyers/promoters being concerned (Northern Knowledge, Auto1, Compleo Charging, Naga)
- kind of prison monitor data of Administration (Naga Group, Cliq)
- silly and/or over-hyped enterprise fashions (Auto1, Veganz, Social Chain)
- principally promotional character of the inventory (Naga)
Total it was a humorous and actually useful experiment however I’ll proceed to give attention to lengthy solely investing. That is exhausting sufficient.
